Iran's military dismissed President Trump's threat to "annihilate" Tehran as a sign of U.S. "strategic desperation," even as both sides pointed to a "very good" sidelines meeting at the UN. Tehran has laid out conditions for reopening the Strait of Hormuz within a week, while oil prices stayed mixed on Wednesday.
Iran's General Staff said Wednesday that Trump's threats to annihilate Tehran are "a sign of strategic desperation," warning it could inflict strikes "more crushing" than earlier in the nearly seven-month war. The statement, carried by Iran's semi-official Mehr news agency, accused Trump of using his United Nations address to justify aggression.
Yet the rhetoric came alongside signs of diplomatic movement. Trump told reporters his team held a three-hour meeting with Iranian envoys on the sidelines of the UN General Assembly. According to CNBC: "I believe we'll make a deal right after the election", Trump said, expecting an agreement once the midterm elections have passed.
Tehran's conditions for reopening Hormuz
Iran has been negotiating through a Qatari mediator in New York and has communicated conditions for ending the war on all fronts. Tehran wants a halt to what it calls U.S. "acts of aggression," an end to the naval blockade and economic warfare, and the release of Iranian assets, Iranian foreign ministry spokesman Esmaeil Baghaei said. A senior Iranian official separately said Tehran could reopen the strait within a week if Washington eases military pressure and lifts its blockade of Iranian ports.
Shipping still far below pre-war levels
Confirmed transits through Hormuz, which carried about a fifth of global oil and gas shipments before the war, averaged 6.98 million barrels a day in the seven days to Sept. 20, according to Kpler — about 38% of the 18.3 million barrel pre-war baseline. Iran's own crude loadings fell to zero so far in September from 893,000 barrels a day in July as the U.S. reinstated its naval blockade, Kpler said, describing the strait as increasingly a Saudi-controlled shuttle corridor.
Brent crude traded 0.7% higher at $99.90 a barrel on Wednesday, while U.S. WTI futures fell 0.1% to $90.42. Investing.com reported that Brent had dropped below $100 a barrel this week, though it remains well above pre-war levels, as fears over supply disruptions cooled on improving flows out of Saudi Arabia.
War widens as rate hikes follow
The conflict, now nearly seven months old, is widening to new theaters. Investing.com reported that Iran-aligned Houthi militants and Saudi-backed forces are fighting over the Bab el-Mandeb Strait in Yemen, a chokepoint linking the Red Sea and the Gulf of Aden. Concerns that elevated energy prices would stoke inflation have already pushed the Federal Reserve, the European Central Bank and the Bank of Japan to raise interest rates in recent weeks.
An interim peace deal between Washington and Tehran collapsed in July, weeks after it was signed, and neither side has said when the next round of talks will take place. Iranian President Masoud Pezeshkian is scheduled to address the UN General Assembly later Wednesday.
Sources: CNBC, Investing.com
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