The United States showed little immediate enthusiasm for a new Iranian proposal that would end the war and reopen the Strait of Hormuz without resolving the impasse over the Islamic Republic's nuclear program.
Iran's latest offer looked “better” than past pitches, Secretary of State Marco Rubio said late Monday, after it was discussed by President Donald Trump and his national security team. But there was little sign that Washington might be willing to abandon its naval blockade and accept the offer.
Energy prices soared again on the negative signals.
National gas price averages hit a new high amid the war of $4.18 early Tuesday, up from $4.11 a day earlier. The international benchmark price for oil, Brent crude, reached a three-week high above $111 a barrel.
The Iranian proposal would focus on reopening Hormuz — the vital trade route whose closure has rattled the global economy — and ending the war the U.S. and Israel began two months ago, but table thorny nuclear talks until a later date, a Gulf source and a regional source told NBC News.
The details of the plan were first reported by Axios.
“Suffice it to say that the nuclear question is the reason why we’re in this in the first place,” Rubio said in an interview with Fox News.
"They’re very good negotiators," he said of Iran, but he said any agreement would have to be one that "definitively prevents them from sprinting toward a nuclear weapon at any point."
Iran maintains that it has no desire to develop a nuclear weapon, but U.S. demands that Tehran halt its enrichment program have been a key roadblock in peace talks.
The Iranian proposal was discussed Monday in a meeting between Trump and his national security team, according to White House press secretary Karoline Leavitt, although it was not immediately clear how seriously it was being weighed.
“The president’s red lines with respect to Iran have been made very, very clear, not just to the American public, but also to them as well,” Leavitt told reporters. “I wouldn’t say they’re considering it,” she said, adding that Trump would address the subject publicly soon.
Members of Trump’s national security team presented him with multiple options Monday for how to handle the continuing bottleneck in the Strait of Hormuz as talks between the U.S. and Iran have failed to open the critical passageway, according to a U.S. official and a person familiar with the meeting.
The options discussed during Monday’s meeting in the Situation Room included whether the U.S. military presence in the strait should change — either increase or decrease — and whether the military should become more aggressive in conducting operations there, the U.S. official said.
Trump has not made any decisions about the way forward, the sources said. He was expected to hold additional meetings about Iran on Tuesday, but it’s not clear when he might make a decision.
“U.S. negotiators continue to engage with the Iranians, who are struggling to sort out their leadership situation following Operation Epic Fury,” White House spokesperson Anna Kelly said in a statement referring to the war in Iran by the name the Pentagon gave the operation. “The president will only enter into an agreement that puts U.S. national security first, and he has been clear that Iran can never possess a nuclear weapon.”
“The president holds all the cards, and he will not be rushed into making a bad deal,” Kelly added.
The U.S. military is using more than 100 fighter and surveillance aircraft, two carrier strike groups and more than a dozen ships to enforce the blockade of Iranian ports and coastal areas, not the strait itself.
The U.S. has been interdicting ships as they enter the Gulf of Oman after they go through the Strait of Hormuz, rather than stopping ships from going through it. The U.S. is using surveillance aircraft, manned aircraft and sea-based surveillance systems like radars to identify ships that are leaving Iranian ports and coastal areas and communicate with them over radio to let them know they are violating the blockade and need to turn around after they transit the Strait of Hormuz.
The U.S. military directs the ships to go back to Iranian ports in the Gulf of Oman, rather than back through the strait, because it has more options and assets in the Gulf of Oman to enforce the blockade. The U.S. military has stopped and redirected at least 39 ships, according to U.S. Central Command.
While constraining Iran’s nuclear program is critical to the Trump administration, restarting the flow of oil remains a top priority for Gulf allies.
Members of the Gulf Cooperation Council held a meeting Tuesday in the Saudi city of Jeddah, the kingdom’s state news agency said. The Iranian proposal was set to be discussed, according to two Gulf officials.
The U.S. has been signaling that its blockade is inflicting economic pain on Tehran, too, however.
"The pressure on Iran is extraordinary," Rubio told Fox.
Iran is quickly running out of oil storage, according to a new report from Kpler, an intelligence platform. It has enough remaining storage for about 12 to 22 days worth of production, Kpler said.
While there have been many figures floating around about the U.S. blockade’s impact on the Iranian economy, Kpler put the figure at $200 million to $250 million per day.
But crucially, the report outlines that it typically takes about two months for Iranian oil to reach China, with the buyer having two months to make a payment, meaning the true impact on Iran's economy may not be felt for some time yet.
In the meantime, shipping through the crucial waterway is largely at a standstill despite the ceasefire.
According to MarineTraffic, eight ships transited the strait Monday night into Tuesday morning, including four tankers and two cargo ships.
One of the cargo ships, the Chinese-owned New Pioneer, had traveled from Argentina, and was transmitting a destination which indicated it was carrying food or grain bound for Iran. A Japanese-owned crude oil tanker, Idemitsu Maru, also moved through the strait.
Elsewhere, liquefied natural gas tanker Mubaraz reappeared off the coast of south India in the last 24 hours, after it was last seen transmitting in the Persian Gulf a month ago. If it crossed the strait, it would be the first loaded LNG tanker to do so since the war started Feb. 28.
With peace talks stalled and the two countries locked in their maritime standoff, neither side has shown great urgency to make concessions for a peace agreement.
Trump publicly urged Tehran to phone when it wants a deal, after scrapping a planned weekend trip to Pakistan by his envoys that left face-to-face diplomacy at an impasse.
Iranian Foreign Minister Abbas Araghchi traveled to Islamabad, the Pakistani capital that has emerged as a hub of diplomacy, to present Tehran's latest proposal to mediating Pakistani officials, but refused to meet directly with U.S. officials to discuss it.
He then flew to Russia on Monday to meet with President Vladimir Putin, who has been a key backer of Iran.
If no deal can be reached, Rubio said, the next steps would be Trump’s “decision to make.”
Iran was mainly "serious about figuring out how can they buy themselves more time," Rubio said Monday.
"We can’t let them get away with it," he said.
