First US-Iran talks in Switzerland overshadowed by Hormuz closure

[BUERGENSTOCK/DUBAI] US Vice-President JD Vance led talks at a Swiss resort on Sunday (Jun 21) to shore up a tentative peace deal with Iran.

The diplomacy, however, was clouded by Iran’s announcement it had closed the Strait of Hormuz over Washington’s failure to halt fighting in Lebanon.

A memorandum of understanding (MOU) on a path to end the war, agreed a week ago, calls for the strait to be reopened and a halt to all hostilities, including in Lebanon, which Washington’s ally Israel invaded in March.

But with little sign of an end to fighting there, Iran said on Saturday that it had shut the strait again.

US officials have disputed that the strait is closed and said that 55 merchant ships had crossed it on Saturday.

Yet, on Sunday, Iran’s Fars news agency cited a military source as saying that no new permits were being issued for ships to cross until further notice.

Vessel-tracking data showing ships actively transmitting positions broadly backs Iran’s claim the strait is closed, with no tanker crossings recorded since Teheran announced the move on Saturday afternoon.

Iran’s Tasnim news agency, citing a source close to the negotiating team, reported that the strait would not be reopened until a ceasefire in Lebanon was respected.

The source said that the waterway would also remain closed until waivers allowing the sale of Iranian oil were issued.

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Oil prices could surge again

As often the case with major developments potentially affecting the global economy during the war, the announcement that the strait was again shut took place on the weekend with markets closed, making it difficult to assess the impact.

US President Donald Trump said he agreed last week’s MOU to avert a global depression from high oil prices caused by shutting the strait.

Since the agreement was announced, oil prices have tumbled to levels unseen since the war started, but a return of Iran’s effective blockade could see them surge again when markets reopen on Monday.

Iran’s foreign ministry spokesperson, Esmail Baghaei, said that Sunday’s talks in the scenic Qatari-owned Swiss mountain resort of Buergenstock, involving mediators Qatar and Pakistan as well as Iran and the US, would last for just one day.

Since Washington had failed to guarantee a ceasefire in Lebanon, the talks would cover only the implementation of the MOU itself and not the substantive issues foreseen for the next stage of negotiations, Beghaei said.

Qatari foreign ministry spokesperson Majed Al Ansari told Qatar News Agency that specialised technical and follow-up groups have been formed to negotiate the terms of the final agreement covering all aspects of the MOU.

Vance hopes for progress

The MOU foresees 60 days of talks on issues such as curbing Iran’s nuclear programme in return for the lifting of international sanctions. Iran is already expected to receive initial economic benefits, such as sanctions waivers and the unfreezing of blocked assets.

Vance leads the US delegation, opposite Iran’s Parliament Speaker Mohammed Baqer Qalibaf. They previously met at the only known face-to-face talks so far, more than two months ago.

“I think we’re going to hopefully make progress on the nuclear issue, make progress on the Lebanon ceasefire issue,” with a “couple days of talks” likely, Vance told reporters at Joint Base Andrews in Maryland before departing.

On Saturday, Iran’s Revolutionary Guards, accusing Israel of “crimes” in Lebanon that violated US commitments to the ceasefire, said ships would be at risk if they approached the strait, which carried a fifth of global oil supplies before the US and Israel launched attacks on Feb 28.

Ceasefires have been repeatedly announced in Lebanon, most recently on Friday, but appear to have had little impact so far on the fighting there, with more than a million people driven from their homes by Israel’s invasion.

Twenty killed in Lebanon, authorities say

Reuters journalists in southern Lebanon saw rescuers on Saturday carrying wounded at the sites of Israeli attacks, which have reduced swathes of Lebanese towns and villages to ruins of concrete rubble that residents say resemble the Gaza Strip.

Lebanese authorities say 20 people were killed on Saturday.

The army said on Sunday that specialised units were still working to dismantle unexploded Israeli bombs weighing 1,000 and 2,000 pounds that had been dropped on southern towns.

The army had opened some roads, but urged residents to delay returning to border villages and to follow instructions from soldiers to ensure safety amid ongoing Israeli attacks.

Trump’s memorandum to end the war, which he jointly launched alongside Israeli Prime Minister Benjamin Netanyahu in February, is deeply unpopular in Israel, which did not participate in the peace talks.

Netanyahu’s government has said that it will not withdraw from a swathe of Lebanon it seized after Hizbollah fighters fired across the border into Israel in solidarity with Teheran.

The Iranian delegation at the talks includes Foreign Minister Abbas Araqchi, along with senior security, central bank and oil officials, Iranian media said. In addition to Vance, the US negotiating team includes envoys Steve Witkoff and Jared Kushner, Trump’s son-in-law.

None of war objectives achieved

Pakistan said that its Prime Minister Shehbaz Sharif and the army chief, Field Marshal Syed Asim Munir, had arrived to join the talks at the resort, where helicopters hovered overhead.

Vance briefly appeared in front of travelling media as he, Witkoff and Kushner met Sharif and Munir.

Warm greetings were exchanged. As Vance shook hands with Munir and hugged him, he said: “What’s up man?”

Reaching out to Witkoff and embracing him, Munir said: “My brother”.

In an interview with Fox News before leaving the US, Vance said he was confident that the ceasefire would hold and that he had seen no evidence of the Strait of Hormuz being closed.

After Trump and Netanyahu launched the war, they said their aims were to destroy Iran’s nuclear programme, halt its ability to threaten neighbours with missiles and proxy forces, and make it possible for Iranians to topple the government.

None of those objectives has been achieved, although US officials say they inflicted severe damage on Iran’s military and still expect a strong agreement that will prevent Iran from obtaining a nuclear weapon.

A poll by Israel’s Hebrew University, provided to Reuters, showed about 92 per cent of Israelis believe Iran benefited more than Israel from the joint Israeli-US military campaign, while just 8 per cent see Israel as having emerged victorious.

Almost 90 per cent of Israelis said war goals had not been met and fewer than 30 per cent believe Netanyahu’s claims of major achievements. REUTERS