Good Talks.
Complicated.
1. The Wall Street Journal:
Iran and the U.S. are working with mediators to hammer out a 14-point memorandum of understanding that would lay out a framework for a monthlong period of talks to end the war, people familiar with the matter said.
The discussion points would be the focus of talks that could resume as early as next week in Islamabad, they said. Iran has expressed openness to discussing its nuclear program, easing its earlier resistance, the people added.
President Trump said on Wednesday that the U.S. has had “good talks” with Iranian negotiators and the country has agreed not to have a nuclear weapon. Iran claims its nuclear activities are for peaceful purposes.
Details around the length of any suspension of Iran’s uranium enrichment or the possible removal of enriched uranium from the country, along with Iran’s assertion of a permanent role in overseeing the Strait of Hormuz, remain unresolved and are expected to complicate any talks, some of the people said. Other issues that could snarl talks include any sanctions relief.
2. Iran struck a defiant tone on Wednesday as President Trump pressed for a deal to end the war, but also acknowledged that its economy is being squeezed. As Iran reviews the latest U.S. peace proposal, lifting the U.S. military blockade of its ports and relieving pressure on its oil industry is one of the main incentives for Tehran to seek a deal. The blockade has halted Iran’s oil exports, choking off crucial revenues, and the country risks running out of places to store its oil. It is also affecting the import of other goods, forcing Iran to seek alternative routes through neighboring countries and its smaller ports on the Caspian Sea. And the economic pain inside Iran, already dire before the war, is becoming much worse. “The sea blockade is a much more serious threat than even war, and the current stalemate must be broken because the export of our oil and energy and the fate of our refineries is now at risk,” said Hamid Hosseini, an expert on Iran’s oil sector who serves on the energy committee of Iran’s Chamber of Commerce, in an interview from Tehran. (Source: nytimes.com)
3. The Economist:
The blockade is….hurting Iran, which has already had to trim oil production and press derelict tankers into service as floating storage. Its economy is a mess. But America has not achieved its goal of compelling Iran to make major concessions to get a deal, nor is it likely to do so soon.
Hence the effort to break the deadlock in the strait. American destroyers did manage to escort two us-flagged ships through Hormuz on May 4th. But the “project” was never likely to help the hundreds of others still stuck. Shippers still see transiting the strait as an intolerable risk—particularly after Iranian attacks this week that hit a tanker owned by the UAE’s national oil company and a South Korean vessel.
What it did do was offer Iran a pretext to resume attacks on its neighbors. Iran fired at least 19 missiles and drones at the UAE on May 4th, the first such strikes since shortly after the ceasefire was called on April 8th. The drones caused a fire at the oil terminal in Fujairah, the UAE’s only major port outside the Persian Gulf and thus its only wartime outlet for crude exports. The Emiratis were understandably furious, and many officials in the Gulf assumed America would retaliate. Instead it played down the attacks. Mr Trump soon said that he was suspending “Project Freedom”, ostensibly at the behest of Pakistan, which is mediating between America and Iran. (Source: economist.com)
4. Since the start of the Iran war, crude exports through Fujairah have risen 38%, pushing towards the upper limit of the pipeline that feeds the port. At Khor Fakkan, terminal operator Gulftainer said the number of containers it handles has jumped roughly 25-fold. Iran reminded the Gulf region on Monday, however, just how exposed the ports are when its drones hit the Fujairah Oil Industry Zone, sparking a fire at one of the UAE’s most critical energy facilities and injuring three workers. Hours earlier, Iran's Revolutionary Guards Navy had published a map appearing to extend its zone of control along the UAE's eastern coastline, encompassing both ports. Shipping sources said on Tuesday that neither port had yet been affected, but the message from Tehran was clear. (Source: reuters.com)
