By Naeema Saleem — SCN News
WASHINGTON — Iran is keeping negotiations with the United States alive despite President Donald Trump’s rejection of Tehran’s seven-day plan to reopen the Strait of Hormuz and halt the fighting, but it is drawing a firm line around its nuclear programme and insisting that Washington must meet conditions before normal shipping through the strategic waterway can resume. The position leaves diplomacy alive after UNGA81 but shifts the confrontation into a harder bargaining phase in which both sides say they want an agreement while disputing who must make the first meaningful concession.
Iranian Foreign Minister Abbas Araghchi said on Sunday that a negotiated settlement remained the only route out of the conflict and that Tehran had not abandoned the proposal it delivered to Washington through Qatari mediators during the UN General Assembly. “Our conditions are clear,” Araghchi said, adding that reopening Hormuz depended on those conditions being met. His message came a day after Trump publicly rejected Iran’s offer and argued that Tehran was seeking an agreement because U.S. military and economic pressure had left it in a weak position.
The latest statements are significant because Trump’s rejection has not ended the negotiating channel created during a week of intensive diplomacy in New York. Trump said in an interview reported on Sunday that he expected further indirect talks with Iran this week, while Araghchi separately said Tehran remained prepared for diplomacy even as it was also prepared for renewed warfare. That leaves Washington and Tehran closer to continued negotiations than Trump’s rejection initially suggested, but with a substantial gap over what an eventual settlement must contain.
The emerging dispute is increasingly about the terms of peace rather than whether talks should occur at all. Trump says Iran wants a deal but that the proposal currently on the table is not the agreement he wants, while Tehran says Washington cannot expect Hormuz to reopen without reciprocal U.S. action. U.S. Ambassador to the United Nations Mike Waltz described the Iranian package as an unacceptable proposal that sought sanctions relief, access to frozen assets and an end to the U.S. naval blockade, while leaving Washington dissatisfied with what it would receive in return.
Iran’s proposal was considerably more detailed than a general call for a ceasefire. Araghchi said at the United Nations that Tehran had transmitted a concrete seven-day plan through Qatar under which specific American actions would begin first, normal maritime passage would then be restored and negotiations would start on the seventh day. He linked the proposal to the June 17 Islamabad Memorandum of Understanding brokered through the good offices of Pakistan and Qatar, arguing that the earlier arrangement had demonstrated that maritime traffic could recover when both governments adhered to an agreed process.
According to Araghchi’s account at the UN, Iran began technical discussions with Oman after the June agreement and maritime traffic recovered to about 60% of its pre-war level within two weeks. Tehran says subsequent U.S. military and economic measures derailed implementation, while Washington disputes Iran’s interpretation of the agreement and accuses Tehran of failing to meet its obligations. That history now hangs over the new diplomatic effort because each side is demanding evidence that the other will not use negotiations simply to improve its position before returning to confrontation.
Iran’s refusal to retreat from diplomacy therefore does not amount to acceptance of Trump’s terms. Araghchi has simultaneously hardened Tehran’s position on the nuclear dispute, saying Iran would show no flexibility over what it regards as its right to a peaceful nuclear programme. President Masoud Pezeshkian made the same distinction during his UN appearance, saying Iran was prepared for dialogue and negotiations but would not accept what he described as diplomacy conducted through coercion or the threat of force.
That creates two negotiations inside one crisis. The first concerns an immediate mechanism for stopping the fighting and restoring normal shipping through Hormuz. The second concerns the much more difficult long-term settlement involving Iran’s nuclear programme, sanctions, security guarantees and the future rules governing one of the world’s most strategically important waterways.
Washington appears willing to continue talking but sees little reason to accept Tehran’s current sequencing. Trump said when rejecting the offer that Iran wanted Hormuz reopened because it was “losing so badly,” reflecting the administration’s belief that sanctions, the naval blockade and military pressure are steadily weakening Tehran’s negotiating position. Earlier at the UN, Trump had called for Iran’s economic isolation and said he expected an agreement could eventually emerge, while Secretary of State Marco Rubio had also left the door open to negotiations.
Tehran is making the opposite calculation. Iranian officials argue that reopening Hormuz before receiving credible American commitments would mean surrendering their most important bargaining asset while U.S. pressure remained intact. A senior Iranian official told Reuters before Trump rejected the plan that the strait could be reopened within seven days if Washington reduced military pressure and lifted its blockade, but said the United States first needed to make an official commitment to resolving the confrontation diplomatically.
Hormuz consequently remains the central negotiating instrument rather than merely one issue among many. The waterway normally carries roughly a fifth to a quarter of the world’s oil, giving disruption there consequences far beyond Iran and the United States. Months of reduced traffic have contributed to higher energy costs and complicated exports from Gulf producers, increasing pressure on regional governments to find a mechanism that restores predictable navigation.
The economic consequences also give Washington reasons not to allow negotiations to collapse completely. U.S. gasoline and diesel prices have risen sharply since the war began, while energy and transportation costs have become part of the domestic economic debate ahead of the November midterms. That does not determine U.S. policy, but it means Washington’s strategy of waiting for greater Iranian concessions carries economic costs of its own if Hormuz remains disrupted.
For Iran, however, maintaining pressure through Hormuz is also costly. The U.S. blockade is restricting Iranian oil exports and commercial activity, while Washington has continued tightening sanctions and attempting to isolate Tehran economically. Trump’s strategy is based in part on the expectation that those pressures will eventually force Iran to accept an agreement requiring fewer U.S. concessions than the package presented in New York.
The result is a bargaining contest in which both governments believe time can improve their position. Washington expects sanctions and the blockade to increase Iran’s need for economic relief. Tehran expects prolonged disruption of Hormuz, regional security risks and the wider economic impact of the war to increase pressure on Washington and its partners to compromise.
What changed over the weekend is that neither side allowed Trump’s rejection to close the diplomatic channel. Araghchi said mediators had not formally relayed a definitive U.S. response when he initially commented on Trump’s remarks, while Washington has indicated that indirect discussions are expected to continue. Qatar therefore remains central to the process, with Pakistan’s earlier mediation and the Islamabad framework continuing to provide part of the diplomatic architecture from which the latest proposal emerged.
Iran’s strategy also appears designed to separate its willingness to negotiate from any suggestion that U.S. pressure has forced it toward surrender. Pezeshkian used his General Assembly address to say Iran was prepared for dialogue but would not accept the “language of force,” while Araghchi told reporters that Tehran had kept the diplomatic route open despite its deep distrust of Washington. That framing allows Iran to continue bargaining without publicly conceding Trump’s argument that maximum pressure has already succeeded.
The same political problem exists on the American side. After months of war, sanctions and military pressure, Trump has little incentive to accept a settlement that can be portrayed domestically as restoring the situation that existed before the conflict without obtaining substantial Iranian concessions. His description of Tehran’s offer as insufficient suggests Washington wants a settlement that goes beyond reopening Hormuz and restarting negotiations.
That is where the nuclear question could become the largest obstacle. Tehran insists it will retain the right to peaceful nuclear technology and says it is not seeking nuclear weapons. Trump has justified U.S. military action in part as necessary to prevent Iran from obtaining a nuclear weapon and is demanding an agreement that provides stronger guarantees than Washington believes existed before the war.
A short-term Hormuz arrangement could therefore be easier to negotiate than a final peace agreement. Washington and Tehran could potentially construct reciprocal steps involving maritime traffic, the blockade and limited economic relief without immediately settling every nuclear disagreement. The June memorandum attempted something similar by establishing an interim framework while leaving harder questions for subsequent negotiations, but its collapse is precisely why both sides now demand stronger guarantees before repeating that process.
The wider regional environment makes another breakdown particularly risky. Gulf economies remain exposed to instability around Hormuz, while the conflict in Yemen and Houthi attacks have increased pressure around another critical maritime route near the Red Sea. Saudi Arabia has separately pushed for stronger international action against the Houthis, meaning Washington and Tehran are negotiating against a backdrop in which escalation could spread across interconnected regional fronts rather than remain confined to Iran and the Gulf.
Iran’s decision to keep diplomacy alive after Trump’s rejection therefore represents more than an attempt to rescue a failed peace proposal. Tehran is signalling that the seven-day package can remain a starting point for negotiation while refusing to reopen Hormuz unconditionally or concede its nuclear position. Washington, meanwhile, is signalling that it will continue talking but believes its current leverage entitles it to a substantially different agreement.
The immediate question is whether the next round of indirect contacts produces a revised package rather than another exchange of public threats. A phased arrangement in which American economic measures and Iranian steps on Hormuz occur simultaneously could address the central sequencing problem, but the collapse of the June understanding means neither side is likely to accept promises without mechanisms for verification and enforcement.