Trump cancels Iran strike, says 'just made a great deal'; Tehran pushes back, saying no final conclusion reached; markets cheer as Wall Street surges and oil tumbles

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US President Donald Trump speaks to reporters in the Oval Office on Thursday, saying he may sign a peace agreement with Iran as early as this weekend. [Reuters]
US President Donald Trump speaks to reporters in the Oval Office on Thursday, saying he may sign a peace agreement with Iran as early as this weekend. [Reuters]

After the United States abruptly reversed course Thursday — pulling back a threatened large-scale strike on Iran and declaring a peace deal was imminent — Iran's Ministry of Foreign Affairs pushed back, saying no final conclusion had been reached. Observers noted it was at least the 40th time Donald Trump had proclaimed a deal was close only to be rebuffed by Tehran. Yet this time, even Iranian media outlets are giving the prospect of a deal relatively high odds. Markets cheered, with Wall Street surging and oil prices falling, though analysts cautioned that the devil remains in the details.

Speaking in the Oval Office on Thursday, Trump said he had canceled a planned third wave of strikes "based on the fact that discussions between (the United States and) the Islamic Republic of Iran have been conveyed to Iran's supreme leadership and received their approval." He added that a signing ceremony could "perhaps" be held in Europe this weekend, and that Vice President JD Vance would attend — mentioning both the tentative schedule and location under consideration.

Iran, however, said it had not yet reached a final conclusion, and characterized Trump's references to a time and place for a signing as nothing more than the American side's own view. Iran's state-run IRNA news agency, citing Foreign Ministry spokesperson Esmail Baghaei, reported that Iran had not made a final decision on a peace agreement, and that all reports about the time and location of a signing were "speculation."

CNN noted that the cycle of Trump claiming a deal is imminent and Iran pushing back has now played out at least 40 times. The dynamic was on full display Thursday: as Trump made his announcement in the Oval Office, reporters pressed him directly, asking how the current situation differed from the many previous occasions on which he had said a deal with Iran was close.

Still, Iran acknowledged that the latest round of talks had produced more meaningful progress than before. Fars News Agency, citing a source familiar with the negotiations, reported that the United States had ultimately accepted Iran's original draft proposal, and that Iran's top leadership was therefore likely to give the text its final approval.

Markets responded enthusiastically to the prospect of a deal. The Dow Jones Industrial Average surged 929.97 points, or 1.86 percent, to close at 50,848.75 — crossing the 50,000 mark. The S&P 500 gained 127.31 points, or 1.75 percent, to finish at 7,394.30. The technology-heavy Nasdaq Composite climbed 640.16 points, or 2.54 percent, to close at 25,809.66.

Oil prices tumbled. August-delivery Brent crude futures fell 2.92 percent to $90.38 a barrel, while July-delivery West Texas Intermediate settled down 2.58 percent at $87.71. US Treasurys strengthened, with the yield on the 10-year note falling 0.1 percentage point to 4.45 percent. As investor risk appetite returned, the dollar weakened — the Bloomberg Dollar Spot Index, which tracks the greenback against a basket of major currencies, slipped 0.3 percent. Ulrike Hoffmann-Burchardi, chief investment officer at UBS, said: "The path to resolution may not be smooth, but our base case is that diplomatic efforts will ultimately prevail."

For optimism to become reality, the two sides must still overcome the devil in the details. On the substance of a memorandum of understanding, Iranian outlets including Fars News reported that a deal now looks more likely because Trump withdrew additional demands he had made after reviewing an initial draft MOU. American outlets including The Washington Post also reported that on the nuclear question — the core of the negotiations — Trump had effectively returned to the terms of the 2015 agreement he had long criticized.

That 2015 accord, the Joint Comprehensive Plan of Action, barred Iran from enriching uranium to weapons-grade levels for 15 years. Trump had repeatedly attacked the deal as too weak, vowing to secure a ban of at least 20 years.

Yet the list of issues the United States must now resolve with Iran has grown beyond denuclearization alone, to include the opening of the Strait of Hormuz and the question of transit fees, as well as the release of frozen Iranian assets. With more variables in play — and with the November midterm elections approaching and the already-underway CONCACAF World Cup adding to the pressures on Trump — analysts say it will be difficult for either side to hold firm on the details of their earlier positions.


kate01@heraldcorp.com