Iran rejected a 15-point American ceasefire proposal delivered through Pakistan on Wednesday and issued its own five-point counterproposal demanding control of the Strait of Hormuz, war reparations, and guarantees that the conflict won't resume.
The rejection came hours after US President Donald Trump told reporters that Washington and Tehran were 'in negotiations right now.' Iran's Foreign Minister Abbas Araghchi flatly denied it. 'No negotiations have happened with the enemy until now, and we do not plan on any negotiations,' he told state television.
Araghchi went further later on Wednesday. 'We do not want a ceasefire,' he said. 'We want the war to end in a way that it does not repeat, on our own terms.'
Trump, speaking to congressional Republicans that evening, dismissed Tehran's defiance. 'They want to make a deal so badly, but they're afraid to say it,' he said.
That contradiction is whipsawing global markets, with investors caught between hope for peace and fear of prolonged war.
What the US Proposed and What Iran Wants Instead
Two Pakistani officials described the 15-point plan as covering sanctions relief, a rollback of Iran's nuclear programme, limits on its missile capabilities, and the reopening of the Strait of Hormuz.
The proposal, first reported by The New York Times, would also require Tehran to dismantle three nuclear sites, stop funding Hezbollah, Hamas, and the Houthis, and surrender all enriched uranium to the International Atomic Energy Agency.
Iran's state broadcaster Press TV, citing an unnamed senior official, published Tehran's counterproposal with five conditions:
- A complete halt to 'aggression and assassinations' by the US and Israel
- Mechanisms to prevent future wars
- Payment of war reparations
- An end to hostilities against all allied resistance groups
- Recognition of Iran's sovereignty over the Strait of Hormuz
That final demand is the deal-breaker. Washington's proposal explicitly requires the strait to be reopened. Tehran's counter demands the opposite.
Why the Strait of Hormuz Changes Everything
One-fifth of the world's oil supply normally passes through the Strait of Hormuz. Since Iran shut the waterway in early March, the International Energy Agency has called this the largest supply disruption in the history of the global oil market. Flows have dropped by more than 90%, and Gulf oil production has fallen by at least 10 million barrels per day.
Iranian military spokesperson Ebrahim Zolfaghari mocked Washington's diplomatic efforts on Wednesday, asking whether the US had reached 'the stage of you negotiating with yourself.' He also said Tehran would charge tolls on passing ships. 'The authority to issue passage permits is ours,' he said.
Markets Caught Between Hope and Reality
Wall Street initially jumped more than 1% on ceasefire hopes before wobbling after Iran's rejection. The S&P 500 closed up 0.54%, and the Dow gained 305 points. Brent crude settled at $102.22 (£76.48) a barrel, down 2.2% after dropping as much as 7% earlier in the session.
Stock indexes also climbed more than 1% in London, Paris, and Shanghai. Tokyo's Nikkei 225 surged 2.9%.
What Happens Next
Mediators from Pakistan, Egypt, and Turkey are pushing for in-person talks, possibly as soon as Friday in Islamabad. A senior Iranian official told Reuters that Tehran is still reviewing the proposal, suggesting the door hasn't fully closed.
But the gap between the two sides remains vast. Every day the strait stays shut, petrol prices, food costs, and fertiliser supplies squeeze households worldwide.
More than 2,000 people have been killed across the Middle East since the war began on 28 February.
Whether this conflict ends or escalates isn't just a foreign policy question. It's a cost-of-living one.
