Key Takeaways:
Qatar, Pakistan and other regional mediators are pressing both sides to de-escalate after two days of US-Iran strikes threatened to collapse the nuclear deal.
Qatar, Pakistan, Turkey, Egypt and Saudi officials conducted multiple phone calls Wednesday with both US and Iranian counterparts in an effort to calm the situation, according to two sources from the mediating countries and a US official. The outreach came after President Trump declared the US-Iran memorandum of understanding "over" and ordered two rounds of airstrikes that hit 90 targets across Iran, according to US Central Command.
"The mediators believe the recent Iranian attacks in Hormuz were initiated by elements inside the Iranian regime that oppose the MOU and want to undermine it," a regional source from one of the mediating countries said. Iran's Foreign Minister Abbas Araghchi told Pakistani military commander Field Marshal Asim Munir that the US attacks and rhetoric violated the MOU, according to a statement on his Telegram channel.
Thursday was "much calmer," a US official said, adding that the US military conducted no new strikes. Iran's Health Ministry reported at least 14 people killed and 78 wounded from the American strikes, most of them members of the armed forces. Jordan's military said it intercepted eight missiles fired from Iran, while Iran's Revolutionary Guard claimed it struck a US command-and-control center in Jordan with 10 ballistic missiles.
The Strait of Hormuz, through which about a fifth of the world's traded oil and natural gas passed before the conflict began in February, remains the central flashpoint. Maritime data from Lloyd's List Intelligence showed 576 ships transited the strait in June, up from 233 in May but still far below the 3,100 that passed through in June 2025. The attacks on shipping virtually halted traffic in the waterway during the conflict, sending oil prices higher and raising costs for food and other goods globally.
Diplomatic Channels Remain Open
Iran's Araghchi held separate phone calls with his Omani, Turkish and Saudi counterparts Thursday, discussing the need to use diplomatic channels to prevent escalation, the Iranian foreign ministry said. "There are extensive diplomatic efforts to first agree with both sides on de-escalation and then set a date for another round of negotiations between the technical teams," one regional source involved in the mediation said.
After a meeting Thursday with his top national security team, Trump administration officials said they remain "still committed to finding a resolution, and technical-level talks continue" to reach a nuclear deal. A US official added that "the MOU is performance-based, and Iran's actions constitute failed performance at an unacceptable level."
The last time US-Iran tensions escalated to direct military exchanges was during the initial weeks of the conflict in February and March, when oil prices surged more than 20 percent and the VIX spiked above 35. This week's strikes have so far triggered a more contained market reaction, with Brent crude rising about 4 percent and gold gaining 1.5 percent as safe-haven demand increased.
The mediators view the current situation as salvageable, believing progress made in earlier rounds of talks can be preserved. Negotiations on a final deal were due to begin after the funeral of Iran's slain Supreme Leader Ali Khamenei, who was buried Thursday in Mashhad. Those talks are expected to address the toughest issues: fully reopening the Strait of Hormuz and rolling back Iran's nuclear program.
This article is for informational purposes only and does not constitute investment advice.
