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US stocks rally, oil prices fall as Trump calls off fresh Iran strikes
Trump to 'unleash hell' if Iran fails to make a deal
US President Donald Trump is ready to "unleash hell" if Iran doesn't accept a deal to end the Middle East war, the White House warned Wednesday, adding that talks continued despite Tehran reportedly rejecting a proposed US peace plan.
The ramped-up rhetoric dashed hopes of any imminent de-escalation, as the violence on the ground showed no sign of abating after almost four weeks.
"If Iran fails to accept the reality of the current moment... Trump will ensure they are hit harder than they have ever been hit before," Press Secretary Karoline Leavitt told a new briefing.
"President Trump does not bluff and he is prepared to unleash hell. Iran should not miscalculate again," she said, while adding that "talks continue".
Pakistani officials earlier said Islamabad had conveyed to Tehran an American 15-point plan to stop the fighting that began on February 28 with US-Israeli attacks on Iran and has since engulfed the region.
Iran state television cited an unidentified official as saying Tehran had "responded negatively" to the plan and that the war would only end on Tehran's terms.
"The end of the war will occur when Iran decides it should end, not when Trump envisions its conclusion," the Iranian official said, according to the English-language broadcaster Press TV, in a report picked up by Iran's main news agencies.
With thousands more US troops reportedly headed to the Middle East, Iran also threatened to open a new front by targeting shipping the Red Sea, should the US launch a ground invasion.
- 'Out of control' -
UN Secretary-General Antonio Guterres said the war was "out of control".
"The world is staring down the barrel of a wider war, a rising tide of human suffering, and a deeper global economic shock. This has gone too far," he told reporters.
On the ground, there was no let-up in the hostilities, with targets in Iran, Israel, Lebanon, Bahrain, Kuwait, Jordan and Saudi Arabia all coming under fire.
Iran's military said its cruise missiles fired at the USS Abraham Lincoln carrier group had "forced it to change its position", warning of "powerful strikes" when the fleet comes into range.
US ally Israel, meanwhile, said it had struck targets in Tehran as well as a submarine development facility in the central city of Isfahan.
From the Iranian capital, 40-year-old Shayan told AFP: "There is gasoline, water and electricity. But there is a sense of helplessness in all of us. We don't know what to do and there's really nothing we can do."
- Iran sets five conditions -
Trump has in recent days repeatedly claimed progress in talks with Iran, even as Tehran denied any formal negotiations were taking place.
But mediators in the region said work was ongoing behind the scenes.
Egyptian Foreign Minister Badr Abdelatty confirmed his country's role as mediator, alongside Pakistan and Turkey, and said he supported direct negotiations between the US and Iran.
"Our efforts are ongoing," he said.
According to the New York Times, citing anonymous officials, the American 15-point plan touches on Iran's contested nuclear and missile programmes, as well as "maritime routes".
Tehran has largely blocked the vital Strait of Hormuz oil route in retaliation for the US-Israeli attacks, pushing up global energy prices.
The Iranian official quoted by Press TV said Tehran has put forward its own five conditions for hostilities to end.
These include guarantees against future attacks as well as compensation for the destruction caused.
Iran's conditions also include a cessation of hostilities on all regional fronts and against all "resistance groups" -- an implicit reference to the Tehran-backed Lebanese group Hezbollah.
- Red Sea threat -
Speculation in Iran of a possible US invasion of an Iranian island led to stark warnings of more violence and a further squeeze on ship traffic.
"Based on some intelligence reports, Iran's enemies are preparing to occupy one of the Iranian islands with support from one of the regional states," Iran's powerful parliament speaker Mohammad Bagher Ghalibaf wrote in an X post.
Should that happen, "all the vital infrastructure of that regional state will be targeted with relentless, unceasing attacks", he said.
In the event of a US invasion, Iran would block the Bab el-Mandeb Strait, which connects the Indian Ocean to the Red Sea and the Suez Canal, an unnamed military official told local media.
Iran has close links to and arms the Houthi rebel group in Yemen which greatly reduced Red Sea traffic in October 2023 when they began attacking vessels in retaliation for Israel's bombardment of Gaza.
- Dismantling Hezbollah -
It remains unclear whether Israel is on board with America's diplomatic overture.
While striking targets in Iran Wednesday, Israel kept up its campaign against Hezbollah in Lebanon, where Israeli warplanes pounded the southern suburbs of Beirut.
Israeli Prime Minister Benjamin Netanyahu said that dismantling Hezbollah "remains central" to Israel's objectives in Lebanon.
Lebanon was pulled into the war when Hezbollah began firing rockets into Israel on March 2 to avenge the killing of Iran's supreme leader Ayatollah Ali Khamenei.
According to Lebanese authorities, more than 1,000 people have been killed in over three weeks of Israeli strikes and upwards of one million people displaced.
- 'Non-hostile vessels' -
With the war sending energy prices soaring, fuelling fears of higher inflation and weaker global growth, markets remained focused on the Strait of Hormuz, through which one fifth of the world's oil passes.
Tehran, in a message circulated by the International Maritime Organization (IMO), assured safe passage through the strait to "non-hostile vessels".
However, the IMO also cited a statement from Iran's foreign ministry as saying no passage would be granted to vessels belonging to "the aggressor parties -- namely the United States and the Israeli regime".
Stock markets rallied and oil prices tumbled on initial reports over potential negotiations, but on Wednesday the Brent crude benchmark crept back above $100 a barrel.
burs-mfp/dc
T.Bondarenko--BTB