Iran US Talks Stall as Oil Falls and Hormuz Risks Linger

Iran US talks aimed at ending their eight-month war are continuing through mediators, Tehran said on Monday, November 2, after days of discussions with Qatari officials ended with revised proposals but no breakthrough, Reuters reported.

"Consultations through mediators are very intensive," Iranian Foreign Minister Abbas Araqchi said, according to state media outlet IRNA, adding that the outcome depends on Washington.

A shorter version of Iran's plan

Foreign Ministry spokesperson Esmaeil Baghaei said the basis of the talks is still the seven-step plan Iran submitted in September, which US President Donald Trump rejected at the time. Iran now says the plan has been condensed so it could be implemented within two days. As described by Reuters, it would involve:

• the US ending its blockade of Iranian ports;
• Iran reopening the Strait of Hormuz;
• a US waiver on Iranian oil sales and the cancellation of new sanctions;
• talks on other issues afterwards.

Baghaei said a return to negotiations on Iran's nuclear programme could only follow once Tehran verifies its conditions are met.

Fears of renewed strikes after the midterms

The war began when the US and Israel launched attacks on February 28. Trump has repeatedly said there would be no new attack before the US midterm elections on Tuesday, November 3, but China and Russia both spoke out on Monday against renewed military action. Iranian sources told Reuters they believed a new US attack was still more likely than a deal, and Iran has threatened to respond to any attack aggressively.

Shipping risks remain high. Qatari operator Nakilat said one of its LNG tankers was struck in the Gulf by unidentified objects on Friday, and Iran's Revolutionary Guards navy said two oil tankers exploded after hitting mines on an "unauthorized route" through the strait, according to Reuters reporting summarised by Just Security.

Oil prices and what it means for Thailand

Oil prices fell nearly 4% on Monday on hopes that mediation could lead to a diplomatic solution. That matters well beyond the Gulf. The Bank of Thailand said last week that heightened uncertainty around the Middle East conflict and oil prices are key upside risks to inflation, and it expects foreign tourist arrivals to Thailand to decline amid higher oil prices, a direct concern for Phuket's airlines, hotels and tour operators.

For more context, read our guide to the US midterm elections, plus our reports on Thai business sentiment and foreign tourist arrivals.

Photo: The Strait of Hormuz seen from the Space Shuttle, NASA, public domain.