Iran announced Monday that it is halting all communication with the United States unless Israel stops its expanding military offensive in southern Lebanon, the semi-official Tasnim news agency reported. The move suspends a negotiating track that, just days earlier, had appeared to be edging toward a 60-day memorandum of understanding to extend the ceasefire and reopen the Strait of Hormuz.
Iranian Foreign Minister Abbas Araghchi framed the decision as a matter of principle about the scope of any truce. “A ceasefire between Iran and the United States constitutes, without any ambiguity, a comprehensive ceasefire across all fronts, including Lebanon,” he wrote on X. Tehran is demanding that Israel halt attacks and withdraw from occupied areas in Lebanon for talks with Washington to resume, according to Tasnim.
The threat to energy markets was explicit. Tehran warned it could completely block the Strait of Hormuz and open additional fronts, including the Bab el-Mandeb Strait — the chokepoint connecting the Red Sea to the Gulf of Aden through which a large share of Europe-bound and Asia-bound cargo passes. Hormuz has been effectively closed since the war began February 28; reopening it has been the central prize of the diplomatic effort and the single largest swing factor for crude prices.
The trigger was a sharp escalation in Lebanon over the weekend. Hezbollah said it launched more than 20 attacks on Israeli military targets Sunday and Monday, firing rockets and missiles at several Israeli cities. Israel responded by ordering troops to push deeper into southern Lebanon and warning residents of Beirut’s southern suburb of Dahiyeh — a Hezbollah stronghold — to evacuate ahead of planned airstrikes. Prime Minister Benjamin Netanyahu said Hezbollah’s Beirut headquarters would “remain out of bounds.”
Markets reacted immediately. West Texas Intermediate rose more than 5% Monday to settle at $92.16 a barrel, and international benchmark Brent advanced more than 4% to $94.98, as traders erased hopes for a near-term resumption of energy flows through Hormuz. The bounce followed the worst week for crude since mid-April and a May in which Brent fell almost 19% — its worst month since the COVID-19 pandemic.
Iran’s crude loadings underscore how thoroughly the war has throttled its exports: May volumes fell below 0.3 million barrels per day, down sharply from 1.5 million in April and 1.7 million in March, according to UBS. Even if a deal is eventually reached, analysts caution that any reopening of the strait would likely be only partial given the significant damage to infrastructure, refineries, and pipelines across the Gulf, along with ongoing security challenges for tanker traffic.
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