Hopes have risen for renewed talks between the United States and Iran, as the US military said its blockade of Iranian ports was in full effect and Tehran threatened to retaliate by striking targets across the war-weary region.
US President Donald Trump said on Tuesday that a second round of talks could happen “over the next two days”, telling the New York Post the negotiations could be held again in Islamabad as diplomats worked through back channels to arrange them.
Regional officials said on Wednesday that the US and Iran gave an “in principle agreement” to extend the two-week ceasefire, which is due to expire on April 22, to allow for more diplomacy.
One of the officials, who is involved in the mediation efforts, said mediators were working on a compromise to the three main disputed points — Iran’s nuclear programme, the Strait of Hormuz and compensation for Iran’s wartime damages.
UN secretary-general Antonio Guterres said it is “highly probable” that talks will restart, citing a meeting he had with Pakistan’s foreign minister, Ishaq Dar.
On Wednesday, Iranian state media reported that the commander of Iran’s joint military command warned that Iran would completely block exports and imports across the Persian Gulf region, the Sea of Oman, and the Red Sea if the United States does not lift its blockade on Iranian ports.
“Iran will act with strength to defend its national sovereignty and its interests,” said Ali Abdollahi.
He added that the US blockade is “a prelude to violating the ceasefire”.
Iran effectively closed the Strait of Hormuz when Israel and the US launched strikes against it more than a month ago. The US on Monday began blockading ships trying to enter or leave Iranian ports and said it would not impede the freedom of navigation of other vessels in the Persian Gulf.
US Central Command said in a statement on Wednesday that no vessels have made it past US naval forces during the first 48 hours of the blockade on ships entering and exiting Iranian ports.
Central Command also said nine vessels have complied with direction from US forces to turn around and return toward an Iranian port or Iran’s coastal area.
A Malta-flagged vessel is the first crude oil carrier to head west through the strait since the US blockade began, according to a global shipping tracking monitor.
The Malta-flagged VLCC Agios Fanourios I is expected to arrive on Thursday to Basra, Iraq, where ports are not under the blockade. Marine Traffic said the vessel attempted a transit after anchoring in the Gulf of Oman for nearly two days.
Pakistani Prime Minister Shehbaz Sharif arrived in Saudi Arabia on an official visit on Wednesday as his country pushes to mediate new talks before going to Turkey for the Anatalya Peace Forum, which starts on Friday.
Elsewhere, the Pakistani military chief and the country’s interior minister arrived in Tehran as part of Pakistan’s ongoing mediation efforts. The Pakistani military said the delegation included Field Marshal Asim Munir, the country’s interior minister and other senior security officials.
Oil prices fell on hopes for an end to fighting, and in the US stocks surged close to records set in January. The war, now in its seventh week, has jolted markets and rattled the global economy as shipping has been cut off and air strikes have torn through military and civilian infrastructure across the region.
In a television interview with Maria Bartiromo of Fox News scheduled to air on Wednesday morning Mr Trump said he is happy with oil costing about 92 dollars per barrel.
“It’s going to come dropping down very big as soon as this is over,” he said, referring to the war. “And I think it can be over very soon.”
When that (the Iran war) is settled, gas prices are going to go down tremendously
Later in the interview, he predicted that petrol prices, now averaging slightly above four dollars (just under £3) a gallon, will be “much lower” by the mid-term elections.
Speaking again about the war, Mr Trump said: “When that’s settled, gas prices are going to go down tremendously.”
Meanwhile in Washington, the first direct talks in decades between the Israeli and Lebanese ambassadors to the US concluded on a productive note on Tuesday, according to the US State Department.
Israeli ambassador Yechiel Leiter said the two countries are “on the same side of the equation” in “liberating Lebanon” from the militant Hezbollah group.

Lebanese ambassador Nada Hamadeh Moawad called the meeting “constructive” but urged an end to the ongoing conflict between Israel and Iran-backed Hezbollah militants. Since March, that war has displaced more than one million people in Lebanon.
Later it emerged that Israel will convene a security cabinet to discuss developments with Lebanon.
An Israeli official said the meeting would be held on Wednesday evening.
Israel and Lebanon have technically been at war since Israel was established in 1948, and Lebanon remains deeply divided over diplomatic engagement with Israel.
Israel’s military said on Wednesday that it had struck more than 200 Hezbollah targets in southern Lebanon. Lebanon’s National News Agency reported airstrikes and artillery shelling throughout southern Lebanon on Wednesday, include near Bint Jbeil, where Israeli forces have encircled fighters with the Lebanese militant group Hezbollah.
It later emerged that Lebanon’s Foreign Ministry has filed an official complaint with the UN Security Council over Israel’s intense barrage on the country last week that it says killed more than 300 people and wounded 1,150 others.
In less than 10 minutes last Wednesday, Israel struck 100 targets across Beirut, the Bekaa Valley and southern Lebanon without warning during rush hour, marking one of the deadliest single bombing campaigns in the country’s history.
The ministry said in its letter on Wednesday that the majority of casualties were unarmed civilians. Israel says it targeted Hezbollah militants and infrastructure, but has offered few details on what was hit.
Last weekend in Pakistan, an initial round of talks aimed at permanently ending the US-Iran conflict failed to produce an agreement. The White House said Iran’s nuclear ambitions were a central sticking point.
“I think they want to make a deal very badly,” Mr Trump said in an excerpt from the interview with Fox Business Network’s Mornings With Maria. He added: “I view it as very close to over.”
A US official said Tuesday that fresh talks with Iran were still under discussion and that nothing has been scheduled.

Muhammad Aurangzeb, Pakistan’s finance minister, told the Associated Press that “our leadership is not giving up” on efforts to help the US and Iran end the conflict.
Mr Trump on Wednesday claimed that China has agreed not to provide weapons to Iran as reports circulate that Beijing has considered transferring arms.
Mr Trump wrote in a social media post that China is “very happy that I am permanently opening the Strait of Hormuz”.
He added: “They have agreed not to send weapons to Iran.”
China has long supported Iran’s ballistic missile programme and backed it with dual-use industrial components that can be used for missile production, according to the US government.
Though the ceasefire appeared to hold, the showdown over the strategic Strait of Hormuz risked reigniting hostilities and deepening the regional war’s economic fallout.
The fighting has killed at least 3,000 people in Iran, more than 2,100 in Lebanon, 23 in Israel and more than a dozen in Gulf Arab states. Thirteen US service members have also been killed.
US Central Command said on Tuesday that no ships made it past the blockade in the first 24 hours, while six merchant vessels complied with a direction from US forces to turn around and re-enter Iranian waters.
The blockade is intended to pressure Iran, which has exported millions of barrels of oil, mostly to Asia, since the war began on February 28. Much of it has likely been carried by so-called dark transits that evade sanctions and oversight, providing cash that has been vital to keeping Iran running.

Tankers approaching the strait on Monday turned around shortly after the blockade took effect, though one reversed course again and transited the waterway.
Since the war began, Iran has curtailed maritime traffic, with most commercial vessels avoiding the waterway.
Tehran’s effective closure of the strait, through which a fifth of global oil transits in peacetime, has sent oil prices skyrocketing, pushing up the cost of fuel, food and other basic goods far beyond the Middle East.