US and Iranian officials talk truce on UN sidelines

In his speech at the UN summit this week, Iranian President Masoud Pezeshkian said that Iran is willing to come to an agreement with the US to end the war ahead of the midterms. This was both an olive branch and a direct response to Trump’s claims that Tehran was seeking to draw out the conflict until after the midterms.

There have been meetings in New York this week between Trump’s Middle East envoy Steve Witkoff and his son-in-law Jared Kushner representing the US and Foreign Minister Abbas Aragchi representing Iran. A potential phased deal has emerged in which Iran would reopen the Strait of Hormuz in exchange for relief from economic sanctions from the US and an end to the US blockade of Iranian ships.

Markets reacted with optimism to news of the potential truce but there are reasons to be skeptical that any meaningful resolution of the 7-month-old conflict is at hand.

Trump seems to have calculated that, due to the war’s overwhelming unpopularity, a serious military escalation with Iran ahead of the midterms would hurt Republicans in the midterms. Afterwards, he believes he can act with a freer hand.

Iranian officials do not trust the US to stick to a meaningful and enduring diplomatic solution. However, there may be an opportunity for them to win concessions by offering Trump an offramp that would allow painfully high gas and diesel prices to stabilize and possibly come down before the midterms.

Most likely, Tehran sees any relief they would obtain from such an arrangement as temporary, but worth having. Despite their defiance and continuing preparations for a long war, there is no question that the current US sanctions and blockade of the Strait are causing them significant economic pain as well.