Trump Says No Deal With Iran Is Needed as Washington Settles, for Now, on Keeping the Status Quo

Nine months into the war with Iran, US President Donald Trump is confronting new realities that leave him with dwindling options for ending the conflict. On Thursday, he waved away the need for a deal with Iran, saying the US has billions of Iran’s dollars frozen in overseas accounts.

In a post on Truth Social, Trump wrote: “We don’t need a deal with Iran. Those days have long since passed. We’ve got their money.”

Negotiations with Iran are stuck, with mediator Qatar working to bridge the divide. Trump met Qatar’s prime minister at the White House this week, and said afterward that Gulf Arab allies prefer the “status quo” of continued economic pressure on Iran. He wrote that while the US remains “locked and loaded”, an attack at this point “seems to be quite unlikely.”

That is a pivot from his earlier threats to carry out quick, intense strikes on Iran in the days before he had to contend with two election setbacks.

Trump’s wartime ally, Israeli Prime Minister Benjamin Netanyahu, whom he had thrown his support behind, is on the cusp of being ousted from power after elections there. Meanwhile, at home, Trump’s party lost its majority in Congress in the midterm elections. Vice President JD Vance blamed the Republican losses on the unpopular war with Iran and the nature of US relations with Israel.

Senior UAE diplomat Anwar Gargash told an audience in Abu Dhabi this week that the region must “prepare for a prolonged period of uncertainty, in which neither a decisive resolution nor a stable regional order can be taken for granted.”

Official Iranian social media accounts frequently post videos of attacks on ships in the Strait of Hormuz for violating Iran’s new rules requiring permission to navigate the waterway, which was open and free to ships before the war. The US, meanwhile, is assisting oil tankers through the strait using a route close to Oman’s coastline. While this has helped Arab states export their oil, it does not solve the bigger problem of how to bring back pre-war production levels of other vital products such as liquefied natural gas, fertilizer and aluminium. Nor does a status quo allow countries such as Kuwait, Qatar and Bahrain to import goods to their ports.

The International Monetary Fund says Gulf Arab states are in economic recession as a result of the war, despite higher oil prices. It says the economies of Kuwait, Qatar and Iraq are contracting by approximately 16 percent this year, while Bahrain’s is down 11 percent.

The US is sending a third aircraft carrier with thousands of troops to the region, leaving open the possibility of another planned military escalation. This week, Iran unveiled what it says is a new underground missile production site. The two sides are also still occasionally carrying out tit-for-tat strikes: on Friday, Iranian media said the US struck one of its islands in the Strait of Hormuz, an area where Iran has radars and drone launch sites, and Iran’s Revolutionary Guard said it hit back, targeting an early-warning US radar in Bahrain.

Secretary of State Marco Rubio told reporters this week that there is no need for military action against Iran at this stage because economic sanctions are doing the job. “The pain that they’re feeling is, eventually you have to eat. Eventually you have to be able to pay your own fighters and your own security forces,” Rubio said.

A US naval blockade at sea is barring Iranian ships from transporting oil to countries such as China. According to the US military, this blockade has cut Iran off from at least $25 billion in revenue so far. One of the biggest economic blows has come from the United Arab Emirates, which announced over the summer that it was severing all economic and trade ties with Iran. The UAE had been among Iran’s biggest trade partners, and local bank accounts were allegedly used by Iran’s supreme leader and the Revolutionary Guard to move money around.

At the same time, the US military’s Central Command has announced a new operation, dubbed “Iron Gate”, with other US government agencies, aimed at preventing Iran from using land routes to transport advanced weapons across its borders and the Caspian Sea.

Another consequence of the conflict is the resumption of all-out war between Saudi Arabia and the Houthis in Yemen. The Houthis say Saudi airstrikes across Yemen have killed scores of people in recent months, including nearly 60 this past weekend, many of them women and children, in a village near the capital, Sana’a. Saudi Arabia, meanwhile, faces daily missile and drone attacks by the Houthis, including attacks this week that hit its key East-West pipeline carrying crude oil to bypass the Strait of Hormuz and another that hit Saudi oil company Aramco’s skyscraper headquarters in Riyadh’s financial district. The United Nations says some 330,000 Yemenis have been displaced by the renewed fighting between the Houthis and the Saudi-backed Yemeni government, exacerbating an already dire humanitarian crisis.

Iran says it is prepared for a short-term pause on attacks on ships in the Strait of Hormuz, but insists that seven demands be met before entering into direct talks over its nuclear programme. “The message has been only one thing. These seven items are on the table. Take it or leave it,” Hamidreza Gholamzade, a Tehran municipality spokesperson, told NPR. The demands include lifting sanctions, ending the naval blockade, unfreezing Iran’s dollars in overseas accounts and enforcing a ceasefire across all fronts, which includes halting Israeli attacks in Lebanon and Gaza. Rubio has described the conditions as “absurd”. There is also discussion of diluting and moving Iran’s enriched uranium abroad. However, the head of Iran’s Supreme National Security Council, Mohsen Rezaei, told Iran’s state broadcaster on Wednesday: “We will not remove even a shred of enriched nuclear material from Iran.”