President Trump cancelled planned diplomatic mission by envoys Jared Kushner and Steve Witkoff to Pakistan after a "substandard" Iranian proposal.
Iran later submitted a secondary, more promising offer addressing nuclear concerns, but talks remain stalled due to mutual distrust and strategic differences.
The deadlock keeps the Strait of Hormuz blocked, affecting about 20% of oil transit and sustaining multi‑year high oil prices, fueling inflation.
Investors see a persistent "war premium" in energy and shipping markets, with heightened risk of miscalculation amid ongoing Israeli‑Lebanon clashes.