Iran demands Lebanon ceasefire, unfreezing of assets before peace talks

DUBAI/BEIRUT/JERUSALEM/ISLAMABAD — Iran said on Friday that blocked Iranian assets must be released and that a ceasefire must take hold in Lebanon before peace talks can proceed, throwing last-minute doubt over negotiations scheduled for Saturday in Pakistan.

Iran's ‌parliament speaker Mohammad Baqer Qalibaf said on X that the two measures had been previously agreed with the U.S. and warned that negotiations would not start until they are fulfilled.

His post was echoed by Foreign Minister Abbas Araqchi, who also called for the Israeli airstrikes on Lebanon to stop. Both Qalibaf and Araqchi are expected to be at the talks, Pakistani sources said.

There was no immediate comment from the White House.

US President Donald Trump told the New York Post earlier on Friday that U.S. warships were being reloaded "with the best ammunition to resume strikes on Iran if peace talks in Pakistan fail".

"We’re going to find out in about 24 hours. We're going to know soon," Trump said in a phone interview when asked if he thought the talks would be successful.

Vice President JD Vance, who will lead the U.S. delegation to the talks, said he expected a positive outcome as he headed to Pakistan. But "if they're going to try to play us, then they're going to find the negotiating team is not that receptive", he added.

Iran has been unable to obtain tens of billions of dollars of its assets in foreign banks, mainly from exports of oil and gas, due to U.S. sanctions on its banking and energy sectors.

Tenuous truce

Trump announced a two-week ceasefire in the six-week war on Tuesday, just hours before a deadline after which he had threatened to destroy Iran's civilisation. However, the truce is tenuous with Israel's continuing bombardment of Lebanon and the ongoing closure of the Strait of Hormuz proving key sticking points for both sides.

The ceasefire has halted the campaign of U.S. and Israeli airstrikes on Iran. But it has so far done nothing to end the blockade of the strait, which has caused the biggest-ever disruption to global energy supplies, or to calm a parallel war waged by Israel against Iran's Hezbollah allies in Lebanon.

Iran was doing a "very poor job" of letting oil through the strait, Trump said in a social media post. He also warned Tehran against trying to collect fees from ships crossing it. "That is not the agreement we have!"

Israel and Washington have said the campaign against militant group Hezbollah in Lebanon is not part of the agreed ceasefire.

Israeli forces launched the biggest attack of the war hours after the ceasefire was announced, killing more than 300 Lebanese in surprise strikes on heavily populated areas, Lebanese authorities said.

Israeli strikes continued across southern Lebanon on Friday, with more than a dozen people reported killed in various towns. One strike on a government building in the southern city of Nabatieh killed 13 members of Lebanon's state security forces, Lebanon's President Joseph Aoun said in a statement.

Lebanese authorities say at least 1,830 people have been killed in Israeli strikes since March 2.

Iranian hardline

The hardline taken by Iran's leaders ahead of the negotiations followed a defiant message from its new Supreme Leader Ayatollah Mojtaba Khamenei on Thursday.

Khamenei, yet to be seen in public since taking over from his father who was killed on the war's first day, said Iran would demand compensation for all wartime damage.

"We will certainly not leave unpunished the criminal aggressors who attacked our country," he said.

Although Trump has declared victory, the war did not achieve the aims he set out at the start: to deprive Iran of the ability to strike its neighbours, dismantle its nuclear programme and make it easier for its people to overthrow their government.

Iran still possesses missiles and drones capable of hitting its neighbours and a stockpile of more than 400 kg (900 pounds) of uranium enriched near the level needed to make a bomb. Its clerical rulers, who faced a popular uprising just months ago, withstood the onslaught with no sign of organised opposition.

Tehran's agenda at the talks now includes demands for major new concessions, including the end of sanctions that crippled its economy for years, and acknowledgment of its authority over the strait, where it aims to collect transit fees and control access in what would amount to a huge shift in regional power.

As has been the case throughout the war, Iran's own ships were sailing through the strait unimpeded on Friday, while those of other countries remained hemmed inside.

Among the handful of vessels to cross on Friday was an Iranian supertanker capable of carrying 2 million barrels of crude. Before the war, 140 ships would cross in a typical day, including tankers carrying 20 million barrels.

The disruption to energy supplies has fed inflation and slowed the global economy, with an impact expected to last for months even if negotiators succeed in reopening the strait.

U.S. monthly inflation data released on Friday, the first to show the impact of the war, showed consumer prices rose by 0.9% in March, the fastest rate since the mid-2022 inflation shock that eroded support for Trump's predecessor Joe Biden. —Reuters