In a post on X Tuesday evening, Scott Bessent said the blockade of Iranian ports “directly targets the regime’s primary revenue lifelines” by constraining maritime trade.

“Kharg Island storage will be full and the fragile Iranian oil wells will be shut in,” Bessent said.

Kharg Island is considered the beating heart of Iran’s oil industry, through which 90% of its exports pass.

In line with previous statements about economic pressure effortsBessent also said Iranian funds would remain frozen and any person or vessel facilitating the flow of funds to Iran would risk U.S. sanctions.

Iranian hard-liners rallied late Tuesday night as possible talks in Islamabad with the United States broke down, with members of Iran’s paramilitary Revolutionary Guard apparently bringing a ballistic missile on a mobile launcher to one event.

Footage aired by Iranian state TV showed men carrying Kalashnikov-style assault rifles riding atop a missile that resembled a Qadr ballistic missile in Iran’s capital, Tehran.

Such Qadr missiles can release individual bomblets known as cluster munitions, which Iran used widely when attacking Israel during the war.

The United Arab Emirates thanked Trump early Wednesday over his mention of a possible currency swap with their country as uncertainty remains over the Iran war.

A statement issued by the UAE’s Embassy in Washington appeared aimed at signaling the country remained financially secure after Trump’s comment.

“Any suggestion that the UAE requires external financial backing misreads the facts,” it said. “The UAE is one of the world’s most financially resilient economies, underpinned by more than $2 trillion in sovereign investment assets; more than $300 billion in foreign currency reserves held by the UAE’s central bank; and a banking sector with approximately $1.5 trillion in deposits.”

The UAE is an autocratically ruled federation of seven sheikhdoms on the Arabian Peninsula home to Abu Dhabi and Dubai.

While able to export some oil through a pipeline to the Gulf of Oman, the continued chaos around the Strait of Hormuz has cut off a lot of its oil from reaching the market.

The war also has affected businesses in Dubai and the country’s long-haul carriers Emirates and Etihad.

Trump offered a combative social media post Tuesday night after indefinitely extending a ceasefire in the Iran war after talks in Islamabad failed to materialize.

Writing on his Truth Social website, Trump contended that “Iran doesn’t want the Strait of Hormuz closed, they want it open” so they can sell their crude oil.

Trump said if he allowed that to happen, there “can never be a Deal with Iran, unless we blow up the rest of their Country, their leaders included!”

It’s unclear what the next step forward is to resume talks in Pakistan’s capital.

Starting Monday evening across the country, Israelis marked Memorial Day – the commemoration of fallen soldiers and victims of nationalistic attacks that immediately precedes Independence Day. They did so with fragile ceasefires holding on three fronts – the wars against Hamas in Gaza, Hezbollah in Lebanon, and Iran.

A woman wrapped in a large flag stood still in the middle of light rail tracks on an empty Jerusalem street, observing a nationwide moment of silence. Children played on old tanks as families posed for snapshots at the Armored Corps memorial site in Latrun, where intense battles were fought in the 1948 war over Israel’s establishment.

Soldiers and families somberly placed flowers and flags on rows of stone-marked graves at military cemeteries in Jerusalem and Tel Aviv. Visitors paused to read about the lives of hundreds of revelers who were killed and abducted in the Oct. 7, 2 023, Hamas attack at the site of the Nova music festival.

Secretary-General António Guterres said the U.S. announcement will create “critical space for diplomacy and confidence-building between Iran and the United States,” according to his spokesman.

“We encourage all parties to build on this momentum, refrain from actions that could undermine the cease-fire, and engage constructively in negotiations to reach a sustainable and lasting resolution,” U.N. spokesman Stephane Dujarric said late Tuesday.

The secretary-general “fully supports” Pakistan’s efforts to facilitate U.S.-Iran talks and hopes its efforts “will contribute to creating conditions conducive to a comprehensive and durable resolution to the conflict,” Dujarric said.

Rafael Grossi, the head of the International Atomic Energy Agency, told reporters late Tuesday that the effort to end the war between Tehran and Washington is a “complex process” and that it’s important to allow “continuity” for that process to play out.

“I think it’s very important that an opportunity for peace is given,” he said.

Grossi, who is currently running to become the next U.N. secretary-general, also warned both sides that any peace deal must include the IAEA from the start to enforce oversight over Iran’s nuclear program.

Otherwise, he added, “you will have an illusion of an agreement.”

U.S.-Israeli bombardment eliminated Iran’s supreme leader and much of the nation’s top echelons, but the Islamic Republic’s leadership didn’t fall apart. Negotiations to end the war offer it a new test.

For decades, Supreme Leader Ayatollah Ali Khamenei managed several powerful factions, bringing to heel those who challenged his authority.

It’s now unclear who wields that kind of authority over the civilian figures and powerful generals from the paramilitary Revolutionary Guard who appear to be in charge.

They have found unity — for now — by taking a tough line. But disagreements over how much to concede in negotiations with the U.S. could reveal fault lines as Pakistani mediators try to host a new round of talks.

After Israeli strikes killed Khamenei the first day of the warhis son Ayatollah Mojtaba Khamenei succeeded him.
But doubts persist over the younger Khamenei’s role after reports he was wounded in the strikes. He has not appeared in public since.

At the center of power now is a politburo-like body known as the Supreme National Security Council, which includes Iran’s top civilian and military officials.

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The White House said in a statement that in light of the president’s announcement that he was extending the ceasefire and awaiting a proposal from Iran, Vance and the U.S. negotiating delegation would not be traveling to Pakistan on Tuesday.

The White House did not offer any additional updates on the possibility of in-person meetings.

Shehbaz Sharif thanked the U.S. president for extending the ceasefire with Iran, saying it would allow ongoing diplomatic efforts to proceed.

In a post on X, Sharif said he was expressing gratitude “on my personal behalf and on behalf of Field Marshal Syed Asim Munir” for Trump’s “gracious acceptance” of Pakistan’s request to extend the ceasefire.

Sharif said he hoped both sides would continue observing the ceasefire and reach a comprehensive peace deal during the second round of talks scheduled in Islamabad, aimed at securing a permanent end to the conflict.

The S&P 500 erased an early rise to fall 0.6% after the U.S. vice president called off his trip to Pakistan for negotiations with Iran.

The Dow Jones Industrial Average dropped 293 points, or 0.6%, after erasing an earlier gain of 400 points, while the Nasdaq composite slipped 0.6%. Less than 10 minutes after the U.S. stock market finished trading for the day, Trump said he would extend the ceasefire to give Iran time to submit a proposal to end the war.

Oil prices also wavered before Trump announced the extension, and the price for a barrel of Brent crude went from less than $95 to roughly $100 during the day. It settled at $98.48, up 3.1%.

The moves were mostly more modest than the vicious swings that rocked Wall Street earlier in the war.

The president, in his social media post, also alluded to reported divisions within the Islamic Republic, saying they have come “not unexpectedly.”

Trump has repeatedly said over the course of the ceasefire that began on April 8 that his team is dealing with Iranian officials who want to make a deal, while acknowledging his decision to kill several top leaders has come with some complications.

“We’ve taken out their leaders, frankly, which does complicate things in one way, but these leaders are much more rational,” Trump said earlier Tuesday during an interview on CNBC.

The Iranian mission to the U.N. sent a letter Tuesday asking for the world body and the Security Council to issue a “firm and unequivocal” condemnation of the U.S. decision Sunday to attack and seize an Iranian-flagged cargo ship.

“This constitutes a grave breach of international law, a clear violation of the ceasefire, and an act of aggression marked by the hallmarks of piracy,” the mission posted on X. “Such reckless conduct directly endangers international navigation and undermines maritime safety and security.”

Washington had said the ship tried to evade the U.S. naval blockade near the Strait of Hormuz.

The president said he’s extending the ceasefire with Iran at Pakistan’s request as he waits for a “unified proposal” from the Islamic Republic, but that the U.S. military will continue its blockade of Iranian ports.

Trump added that “he’s directed our Military to continue the Blockade and, in all other respects, remain ready and able, and will therefore extend the Ceasefire until such time as their proposal is submitted, and discussions are concluded, one way or the other.”

The president made the move even as the White House has put on hold Vice President JD Vance’s expected trip to Islamabad for a second round of talks as Tehran, at least for the time being, is balking at further talks.

The president grabbed the microphone and began emphatically belting out the song “Libre,” Spanish for “free,” alongside two other performers as an audience — including Prime Minister Benjamin Netanyahu and his wife, Sara Netanyahu — clapped along.

It’s a popular Spanish song written by Nino Bravo.

The screens behind him on stage featured the “Sol de Mayo,” or “Sun of May” from the Argentine flag next to the Israeli flag bearing the Star of David. The event was to commemorate the start of Israel’s 78th independence day.

The president’s approval rating on the economy has slumped over the past month as the Iran war drives prices higher, according to a new AP-NORC poll, with even Republicans showing less faith in his leadership.

The findings from The A ssociated Press-NORC Center for Public Affairs Research show a president who is struggling with unfulfilled promises to tame inflation and testing Americans’ patience with a conflict in the Middle East that has dragged on longer than expected.

Trump’s approval rating on the economy dropped to 30% in April from 38% in a March AP-NORC poll. A similarly low share of U.S. adults, 32%, approve of the president’s leadership on Iran, which is unchanged since last month.

The poll was conducted April 16-20, during which time the Strait of Hormuz was reopened by Iran, then closed againan example of the whiplash that has characterized the conflict.

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The Iran-backed Lebanese militant group said in a statement Tuesday it had fired rockets and drones at Israeli forces for the first time since a 10-day truce took effect Friday “in response to the blatant and documented violations” by Israel, which it said include “attacks on civilians and the destruction of their homes and villages in southern Lebanon.”

Israeli officials have said they intend to maintain a buffer zone in southern Lebanon and the Israeli military has issued maps of an area it calls a “forward defense line,” which extends several miles into Lebanon, containing dozens of villages whose residents have not been allowed to return.

Gen. Majid Mousavi, the aerospace chief for the Revolutionary Guard, said in comments on Iranian media that it would be a mistake to carry out “aggression” against Iran. He also said the region’s oil facilities would be harmed if neighboring countries allow the U.S. to carry out attacks.

“If southern neighbors allow the enemy to use their facilities to attack Iran, they should say goodbye to oil production in the Middle East region,” he said.

The U.S. has bases and troops in several countries across the region.

As news came that the U.S. delegation was pausing its travel to Islamabad, Iran’s top diplomat posted on X saying that American forces boarding an Iranian oil tanker earlier Tuesday was an act of war.

“Striking a commercial vessel and taking its crew hostage is an even greater violation,” Abbas Araghchi said in a post. “Iran knows how to neutralize restrictions, how to defend its interests, and how to resist bullying.”

Ambassador Amir Saeid Iravani said Tuesday that as soon as Washington ends the blockade, “I think the next round of the negotiations will take place in Islamabad.”

He called the U.S. naval blockade a violation of the ceasefire, and reiterated that lifting it is a condition for new negotiations to take place. The United States has not publicly indicated that it will lift the blockade.

The U.S. started the war against Iran, Iravani said, and if they want to return to the negotiating table “and find a political solution, they will find us ready.”

“If they want to go to the war, in this case also Iran is ready for that,” he told a small group of reporters at U.N. headquarters in New York.

When asked how hopeful he is he about the possibility of new negotiations, the ambassador replied: “We should give the chance — we hope.”

A U.S. official said the Vance trip to Islamabad for potential talks had been called off and put on hold, but cautioned that Trump could change his mind at any minute.

The official, who spoke on condition of anonymity to discuss internal administration deliberations, said Trump’s special envoy Steve Witkoff and son-in-law Jared Kushner were expected in Washington on Tuesday afternoon for consultations about how to proceed.

The official declined to predict what would happen if the current ceasefire expires without another meeting Islamabad but noted that Trump retains options short of restarting airstrikes

State TV quoted the Iranian judiciary’s Mizan news agency denying Trump’s claims that the women are facing execution. It said some have already been released, while others face charges that — if upheld by the courts — would ultimately result in prison sentences rather than execution.

It didn’t name which women were allegedly released.

Human rights centers have reported that at least two of the women were facing charges that carry a death sentence.

Two officials say Pakistani leaders were engaged in intensive mediation efforts late Tuesday to ensure the second round of ceasefire talks takes place.

The officials said Prime Minister Shehbaz Sharif, Army Chief Field Marshal Asim Munir, Deputy Prime Minister and Foreign Minister Ishaq Dar, and the prime minister’s national security adviser were involved in the push.

Despite a delay by Iran in sending its delegation to Islamabad, “overall optimism endures among decision makers in Pakistan,” the officials said.

The officials spoke on condition of anonymity because they were not authorized to speak to the media.

Bita Hemmati was sentenced to death in Tehran after taking part in the protests, according to the Washington-based Abdorrahman Boroumand Center for Human Rights in Iran.

Mahboubeh Shabani was arrested in the city of Mashhad during the protests. She’s charged with “enmity of God,” which carries the death sentence, according to human rights monitor Hengaw.

Diana Taher Abadi and Ghazal Ghalandari are both 16, and were arrested separately in Karaj, west of Tehran, and Yasuj in southwestern Iran during the protests, according to the U.S.-based Human Rights Activists News Agency.

Venus Hossein Nejad, from the Bahai faith, was arrested in January from her workplace in southeast Iran. She was forced to confess on state TV and was accused with others of organizing protests and being members of a “satanic network and under the influence of Israel,” the Oslo-based Iran Human Rights said.

Golnar Naraqi, a 37-year-old emergency physician, was arrested in Tehran during the protests, according to a state-affiliated newspaper.

Two women were identified by Iranian social media as Ensieh Nejati and Panah Movahhedi Salamat. There was no immediate confirmed reports about their whereabouts.

The army said the rockets were fired at Israeli soldiers positioned in southern Lebanon and that it responded by striking the launcher.

This appears to be the first time Hezbollah fired on Israeli troops since a ceasefire took effect Friday, although the Iran-backed group said it detonated explosives Sunday targeting an Israeli convoy i nside Lebanon.

“The launches constitute a blatant violation of the ceasefire agreement,” the army said.

Israel has left thousands of troops inside Lebanon during the 10-day truce.

The army says it also intercepted a drone launched from Lebanon before it crossed into Israeli territory.

There was no immediate comment from Hezbollah.

The president reposted a photo of six women and two teen girls on social media Tuesday morning that a conservative activist noted are facing prosecution by the Iranian government.

“I am sure that they will respect the fact that you did so. Please do them no harm!” Trump posted. “Would be a great start to our negotiations!!!”

Five of those in the photo flagged by Trump were arrested during widespread anti-government protests earlier this year, according to human rights groups.

One of the women, from Iran’s minority Bahai faith, is accused of being part of a network described as “satanic and under the influence of Israel.”

Iranian media sites identified two others in Trump’s posting but did not offer details on why they were detained.

Esmail Baghaei told state TV late Tuesday that Iran was upset about what he called mixed messages from the Americans.

“It is not out of indecisiveness, it is because we are facing contradictory messages and behaviors, and unacceptable actions from the American counterpart,” he said.

As part of Trump’s push to boost defense spending to $1.5 trillion in the 2027 budget, the Pentagon wants to triple spending on drones and related technology to more than $74 billion and invest over $30 billion into more critical munitions.

That includes missile interceptors, whose stockpiles have become critically low during the Iran war.

Military officials said the spending blueprint was developed ahead of the conflict in the Middle East. They also did not discuss how much they will request in additional funds for the war.

Drones and other unmanned vehicles have emerged as a key weapon in the wars in Ukraine and Iran, and top Pentagon officials say the U.S. must significantly increase its funding of both drones and counter-drone systems.

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The Israeli military posted a photo on social media of the replacement crucifix, which appeared smaller but more ornate than the original statue that a soldier was photographed destroying in southern Lebanon. Israel says two soldiers involved in the episode will be held for a month in military detention.

Tuesday’s post on X said troops worked with the community in the Lebanese village of Debel to coordinate the replacement, which includes a metallic-sheened Jesus figure and four paintings of saints, one on each arm of the cross.

Christians are estimated to make up around a third of Lebanon’s population of roughly 5.5 million people. Thousands of Christians were displaced from their homes in the country’s south during the war.

“Today we also reach the political agreement to widen our sanctions regime, to also target those responsible for breaches to freedom of navigation,” said the 27-nation European Union’s
foreign policy chief Kaja Kallas after the Tuesday gathering in Luxembourg.

“Freedom of navigation is non-negotiable. Daily U-turns where the Strait of Hormuz is open or closed, are reckless. Transit through the strait must remain free of charge,” she said, referring to Iran’s charging for safe passage on the Strait of Hormuz.

Kallas said the EU’s maritime security mission would be “the quickest way” to ensure safe transit in the Persian Gulf after peace is settled.

Even if the U.S.-Iran ceasefire holds and the current war ends, the leader of Yemen’s Houthi rebel group said “there is no doubt that further rounds of fighting are coming, as it is merely a truce within a continuous conflict with the enemy.”

In a televised speech Tuesday, Abdul Malik al-Houthi warned that escalation in the region is “possibly high” as the “fragile” ceasefire is nearing an end.

A Houthi missile attack on Israel last month raised concern that Iran’s ally in Yemen may again try to block Red Sea shipping routes, as it did during the war in Gaza.

At least 10 seafarers have been killed and several more severely injured in a series of attacks on commercial vessels around the Persian Gulf since the start of the U.S.-Israel war with Iran, according to the International Maritime Organization, the United Nations agency responsible for regulating global shipping.

IMO spokesperson Natasha Brown said the agency has confirmed 25 attacks on commercial shipping since Feb. 28. Hundreds of ships have been stranded in the Persian Gulf since.

“Around 20,000 civilian seafarers remain aboard vessels in the Persian Gulf, facing dwindling supplies, fatigue and severe psychological stress,” Brown added.

Following an extraordinary council session in March, the IMO said it is working with “relevant states on the development of a safe passage framework” to evacuate stranded crews, while coordinating access to supplies.

U.S. military officials said Tuesday that the Pentagon’s budget calls for spending more than $30 billion to buy more critical munitions, including missile interceptors, whose stockpiles have become critically low during the Iran war.

The supplies under the most strain are the Patriot air defense systems and the Terminal High Altitude Area Defense, or THAAD, interceptors. The THAAD system is designed for defeating medium-range ballistic missiles, while the Patriot system is for taking down short-range ballistic missiles and crewed aircraft.

The $30 billion budget item will also purchase long-range Precision Strike Missiles and Mid-Range Capability missile systems that are used by the U.S. Army.

The $1.5 trillion budget proposal detailed Tuesday by defense officials would allocate nearly $54 billion for military drones and related technology, as well as $21 billion for weapons systems designed to take down enemy drones.

Drones and other unmanned vehicles have emerged as a key weapon in wars in Ukraine and Iran, and top Pentagon officials say the U.S. must significantly increase its funding of both drones and counter-drone systems.

“Drone warfare is rapidly reshaping the modern battlefield,” Jules Hurst III, the acting undersecretary of defense, comptroller, told reporters during a budget briefing at the Pentagon.

“This budget is the largest investment in drone warfare and counter-drone technology in U.S. history.”

Israel’s military sentenced two soldiers to 30 days in jail and removed them from combat duty for smashing the crucifix in southern Leba non.

“The soldiers’ conduct completely deviated from IDF orders and values,” said a military statement, using the acronym for the Israeli military.

The disciplinary measures come after the photo of the incident attracted worldwide attention and condemnations from Christian religious leaders. Israel’s Prime Minister Benjamin Netanyahu and Foreign Minister Gideon Saar have also denounced the incident.

The military said that six other soldiers who stood by without intervening would be summoned for conversations with higher-ups and that military protocol for dealing with religious buildings and artifacts were re-emphasized to troops in the area.

After U.S.-Israeli bombardment eliminated Iran’s supreme leader and much of its top echelons, the Islamic Republic’s leadership didn’t fall apart — but negotiations to end the war offer a new test.

For decades, the supreme leader successfully managed several powerful factions, bringing to heel those who challenged his authority while listening to rival opinions. It’s now unclear who wields that kind of authority over the collection of civilian figures and powerful generals from the paramilitary Revolutionary Guard who appear to be in charge.

They have found unity — for now — by taking a tough line. But disagreements over how much to concede in negotiations with the United States could reveal fault lines, as Pakistani mediators try to host a new round of talks this week.

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When Trump suggested he backs the possibility of a currency swap with the United Arab Emirates, it’s a sign that he is looking to help stabilize that country’s economy in the wake of the disruptions caused by the Iran War.

In a currency swap, a foreign country’s currency is used as collateral for a loan in U.S. dollars. That would enable the UAE to engage in dollar transactions that are at the core of global commerce.

The swap doesn’t necessarily involve transferring tax dollars and can even generate a profit.

The U.S. has engaged in currency swaps in the past with many European countries, Japan, and the Trump administration last year opened a credit line for Argentina.

Pakistan’s Foreign Minister met U.S. Chargé d’Affaires Natalie Baker on Tuesday, urging that Washington and Iran extend the ceasefire and pursue diplomacy, the Foreign Ministry said.

In a statement, it said Ishaq Dar “underscored Pakistan’s consistent emphasis on dialogue and diplomacy as the only viable means to address challenges and achieve lasting regional peace and stability.”

Baker, in response, conveyed Washington’s appreciation for Pakistan’s constructive role in supporting regional peace and facilitating dialogue, the statement said.

The United Arab Emirates, an autocratically ruled federation of seven sheikdoms on the Arabian Peninsula that’s home to Dubai, became wealthy from its oil deposits. It pegs its currency, the dirham, to the U.S. dollar.

While it has been able to send some of its oil out via a pipeline to the Gulf of Oman, the closure of the Strait of Hormuz has squeezed the country’s oil exports.

The UAE has an estimated $2.5 trillion in savings and sovereign wealth funds, but may be seeking the swap to “bolster investor confidence in the UAE’s financial position if the war were to drag on,” said Jason Tuvey, an analyst at Capital Economics.

Trump confirmed in his CNBC interview that he’s considering a request from the United Arab Emirates Central bank for a currency swap to help secure dollar liquidity for the oil-rich economy that’s been rattled by the Iran conflict.

The president expressed surprise that the nation needs assistance, but made clear he was open to the prospect of making the move to help meet his ally’s concerns.

“I mean I’m surprised because they are really rich,” Trump said. He added, “You know, they’re very good for this country. So, yeah, if I could help them, I would.”

Trump was responding to a question during a live telephone interview Tuesday on CNBC, a business news network.

Asked if he would continue the ceasefire if there’s progress in the next round of Iran talks, Trump said, “Well, I don’t want to do that. We don’t have that much time.” He said Iran “had a choice” and “they have to negotiate.”

But it remained unclear when the ceasefire actually expires. Tuesday night was the deadline when the pause was announced two weeks ago, but Trump told Bloomberg News the ceasefire will expire Wednesday night.