President Donald Trump rejected Iran's response to a U.S. peace proposal as "totally unacceptable," declaring the cease-fire "on life support" and sending oil prices higher on Monday as the ten-week-old conflict threatens to prolong disruptions to global shipping through the Strait of Hormuz. The swift rejection underscores the economic costs of continued instability in a region critical to world energy markets.
Iran said its response to a U.S. peace proposal was "generous and responsible" and demanded an end to the U.S. blockade and sanctions. Haaretz reported that Trump's swift rejection sent oil prices higher on Monday amid concerns the ten-week-old conflict would drag on and keep shipping through the Strait of Hormuz paralysed. The market reaction reflects the direct link between diplomatic failures and economic consequences for consumers and businesses worldwide.
Trump's Assessment of Iranian Proposal
Trump said Iran's response to the U.S. cease-fire offer was "just unacceptable," calling Tehran's offer a "stupid proposal." He said, "The cease-fire is unbelievably weak. After reading that piece of garbage, it's on life support," and added, "Nobody would've taken it. Obama and Biden would've taken it – what they took was far worse." Trump said Iran had been "totally defeated" and added that he has "the best plan ever."
Referring to talks over Iran's nuclear program, Trump said Iran had told him it intended to hand over "the nuclear dust," but that the United States would have to remove it because the site was "so obliterated that only one or two countries in the world could get it – us and China." Trump said Iran had agreed to remove the nuclear material "two days ago" but later "changed their mind." He said, "They didn't put it in the paper. We waited four days and it should've taken 10 minutes. They just can't get there. They agree with us, then they take it back."
Internal Iranian Divisions and Regional Complications
Trump also described Iran's leadership as consisting of "moderates and the lunatics" and said the Iranian people "want to go out in the streets, but they have no weapons." He also criticized the Iraqi Kurds, saying, "We thought the Kurds were going to give us weapons, but they disappointed us. They take, take, take." The comments highlight the challenges of negotiating with a regime facing internal divisions and the complexities of regional alliances.
Haaretz said Trump was considering renewing and expanding "Project Freedom" beyond the escort of vessels through the Strait of Hormuz, and that he had not made a final decision. In a post on X, Oman's Foreign Minister Badr al-Busaidi said there was an "urgent need to advance a humanitarian initiative to free ships in the Gulf" after meeting with Arsenio Dominguez, head of the International Maritime Organization.
Saudi Arabia's Role in Military Operations
Haaretz also reported that less than one week ago, on May 5, Trump reversed his plan to help ships pass through the Strait of Hormuz after Saudi Arabia suspended U.S. military access to key bases and airspace needed for the operation, citing NBC News and American officials. The Jerusalem Post said Trump was debating restarting Project Freedom after Iran's "unacceptable" response to the U.S. peace proposal and noted that he had not made a final decision. It also said the U.S. president was considering the matter after speaking by phone with Fox News' John Roberts.
The Saudi decision to suspend military access highlights the constraints on American power projection even among traditional allies, complicating efforts to secure vital shipping lanes that carry a significant portion of global oil supplies.
Why This Matters:
The breakdown in cease-fire negotiations carries direct economic consequences as oil prices respond to the prospect of prolonged conflict disrupting shipping through the Strait of Hormuz, a critical chokepoint for global energy supplies. The failure to reach agreement despite Iran's stated willingness to negotiate raises questions about Tehran's reliability as a negotiating partner and the regime's internal coherence. Saudi Arabia's suspension of military access less than one week ago demonstrates the limits of regional cooperation even when vital economic interests are at stake, potentially leaving commercial shipping vulnerable. The stalled nuclear material removal, with Iran reportedly reversing commitments within days, underscores the challenge of verifying compliance with any agreement. For American consumers and businesses, continued instability in the Gulf translates directly into higher energy costs and supply chain disruptions, while the paralysis of shipping through the Strait threatens broader economic consequences beyond fuel prices.