In brief
- US President Donald Trump told press that the US-Iran ceasefire is on 'life support'.
- The impasse has shaken markets, fears of food and fertiliser shortages.
President Donald Trump warned the ceasefire in the Middle East war was on "life support" on Tuesday after rejecting the latest counteroffer from Iran, which said its military stood ready to respond to any act of aggression.
The president's angry reaction to Iran's position — delivered in response to a United States proposal — sent oil prices soaring and dashed hopes that a deal could be quickly negotiated to reopen the Strait of Hormuz to commercial shipping.
After slamming the reply as "TOTALLY UNACCEPTABLE", Trump insisted the US would see a "complete victory" over Iran, adding that the truce which has largely halted fighting in the Gulf for over a month was on its last legs.
"The ceasefire is on massive life support, where the doctor walks in and says, 'Sir, your loved one has approximately a one percent chance of living,'" he told reporters on Monday.
Iranian parliamentary speaker Mohammad Bagher Ghalibaf, who served as chief negotiator in previous talks with the US, said shortly afterwards that his country was prepared "for any eventuality".
"Our armed forces are ready to respond and to teach a lesson for any aggression," he wrote on X. "A bad strategy and bad decisions always lead to bad results — the world already understands this."
The developments unnerved global energy markets already thrown into chaos by the war and the overlapping blockades imposed by Iran and the US in the Strait of Hormuz — a vital conduit for oil and gas shipments.
"The energy supply shock that began in the first quarter is the largest the world has ever experienced," the CEO and president of Saudi oil giant Aramco, Amin Nasser, told investors.
"If the Strait of Hormuz opens today, it will still take months for the market to rebalance, and if its opening is delayed by a few more weeks, then normalisation will last into 2027."
Hunger and starvation
Aside from energy, the world also faces a shortage of fertiliser — much of which comes from Gulf ports — and hence food for tens of millions of people.
Jorge Moreira da Silva, executive director of the United Nations Office for Project Services (UNOPS), told Agence France-Presse (AFP) there were just a few weeks left to avert a potentially "massive humanitarian crisis".
"We may witness a crisis that will force 45 million more people into hunger and starvation."
Trump did not say what had offended him in Iran's response, but Iran's foreign ministry said it had called for an end to the US naval blockade of its ports and to the war "across the region" — implying a halt to Israel's strikes targeting Hezbollah in Lebanon.
Crucially, ministry spokesman Esmaeil Baqaei told reporters, Iran demanded the "release of assets belonging to the Iranian people, which have for years been unjustly trapped in foreign banks".
This would be not just a return to the status quo before the US and Israel launched the war on 28 February, but a victory in the Islamic republic's long-standing campaign against its economic isolation.
"We did not demand any concessions. The only thing we demanded was Iran's legitimate rights," Baqaei said.
An end to international sanctions would diminish the US' leverage over Iran as it tries to secure a lasting end to Iran's nuclear enrichment.
The US, Israel and their allies have long accused Iran of seeking atomic weapons, an accusation it has repeatedly denied.
Israeli Prime Minister Benjamin Netanyahu has insisted the conflict would not end until Iran's nuclear facilities were destroyed.
The Wall Street Journal, citing people familiar with the matter, said Iran's counterproposal had included the possibility of diluting some of its highly enriched uranium, with the rest transferred to a third country.
'Restraint over'
The lack of a path to a resolution has focused concern on the Strait of Hormuz, where Iran is restricting maritime traffic and setting up a payment mechanism to charge tolls for crossing ships.
US officials have stressed it would be "unacceptable" for Iran to control the international waterway.
Trump told Fox News that he was considering reviving a short-lived US operation to guide oil tankers and other commercial ships through the Hormuz strait, but that he had not yet taken a final decision.
Saudi sources previously told AFP that Saudi Arabia had prohibited the US from using its airspace and bases for the operation the first time around, fearing "it would just escalate the situation and would not work".
As part of its blockade, the US Navy has at times fired on ships to disable them, or boarded and diverted them.
In a social media post on Monday, the spokesman for the Iranian parliament's national security commission warned the US: "Our restraint is over as of today."
"Any attack on our vessels will trigger a strong and decisive Iranian response against American ships and bases," Ebrahim Rezaei said.
For the latest from SBS News, download our app and subscribe to our newsletter.
