in brief
- Iran has lifted and then reimposed its own blockade of the Strait of Hormuz, creating economic chaos.
- The US and Iran remain at loggerheads as a second round of peace talks nears.
United States President Donald Trump has confirmed that it seized an Iranian cargo ship that tried to run its blockade, and Iran has said it would retaliate, raising the possibility that the ceasefire between the two countries might not last for even the two days it is set to remain in force.
Meanwhile, Iran announced it would refuse to join a second round of peace negotiations, despite Trump's warning of potential renewed airstrikes.
The ongoing maritime blockade, now in its third week, has continued to push global oil prices upward and shows little sign of easing, as Iran has lifted and then reimposed its own blockade of the Strait of Hormuz.
Trump said on Sunday that the US military took control of an Iranian-flagged cargo ship that had tried to get past its blockade near the Strait.
"We have full custody of their ship and are seeing what's on board!" he said in a post on social media, adding that US forces blew a hole in the vessel's engine room.
Iran's military said the ship had been travelling from China.
"We warn that the armed forces of the Islamic Republic of Iran will soon respond and retaliate against this armed piracy by the US military," a military spokesperson said, according to state media.
Iran's state news agency reported Iran had rejected new peace talks, citing the ongoing blockade, the US' shifting positions, and "excessive demands".
Trump had earlier warned Iran that the US would destroy every bridge and power plant in Iran if they rejected his terms, continuing a pattern of such threats throughout the war.
Iran has said that if the US were to attack its civilian infrastructure, it would hit power stations and desalination plants of Gulf Arab neighbours.
Pakistan, which has served as the main mediator, appeared to be preparing for peace talks between the two countries.
Peace talks
Trump said his envoys would arrive in Islamabad on Monday evening, one day before a two-week ceasefire ends.
A White House official had said the US delegation would be headed by US vice president JD Vance, who led the war's first peace talks a week ago and also include Trump's envoy Steve Witkoff and son-in-law Jared Kushner.
Two giant US C-17 cargo planes landed at an air base on Sunday afternoon, carrying security equipment and vehicles in preparation for the US delegation's arrival, two Pakistani security sources said.
Municipal authorities in the capital city of Islamabad halted public transport and heavy-goods traffic.
Barbed wire was rolled out near the Serena Hotel, where last week's talks were held. The hotel has told all guests to leave.
The apparent diplomatic setback could set the stage for a renewed surge in oil prices when markets reopen after the weekend.
Now in its eighth week, the war has created the most severe shock to global energy supplies in history, sending oil prices surging because of the de facto closure of the strait.
Thousands of people have been killed by US-Israeli strikes on Iran and in an Israeli invasion of Lebanon conducted in parallel since the war began on 28 February. Iran responded to the attacks with missiles and drones against its Arab neighbours that host US bases.
Iran's chief negotiator, Mohammad Baqer Qalibaf, had earlier said the two sides had made progress but were still far apart on nuclear issues and the Strait of Hormuz.
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