Pakistan's foreign affairs ministry confirmed that ongoing "back-channel talks" between the United States and Iran are aimed at normalizing the situation. These discussions follow a memorandum of understanding (MoU) signed in June in Switzerland, which stipulated a 60-day window for negotiations on Tehran's nuclear program. That initial agreement was reached after 10 days of negotiations.
Several countries, including Pakistan, Egypt, Qatar, and Oman, have been mediating efforts to revive diplomacy between the two nations. While the US has not publicly confirmed these talks, US envoy to the UN Mike Waltz stated that President Donald Trump was "giving it a little bit of room" for diplomacy and that discussions were "continuing" at the "highest level." However, Iran has denied requesting negotiations and stated it has only suspended, not withdrawn from, the negotiation process. Iran insists on first addressing the Strait of Hormuz, then unfreezing Iranian assets, and finally resolving the nuclear issue.
The potential for de-escalation has already impacted commodity markets, with crude prices falling sharply. Brent crude futures dropped 4.8% to settle at $84.09 per barrel, and US West Texas Intermediate declined 4.1% to $79.26 per barrel, both reaching two-week lows. Brent had fallen approximately 16% over three sessions. Despite the price drop, shipping through the Strait of Hormuz remains limited, and Iran rejected an Omani proposal to equally divide shipping routes, citing security concerns. The pause in US strikes on Iran, after nearly two weeks of conflict, is seen as a move to allow space for diplomacy.
