A New Nuclear Deal: Can It End U.S.-Iran Hostility?

By IndraStra Global Editorial Team

Cover Image Attribute: The file photo of the Arak IR-40 Heavy Water Reactor, Iran. / Source: Wikimedia Commons

The prospect of a new nuclear deal between the United States and Iran has emerged as a pivotal moment in global diplomacy, carrying implications not only for the Middle East but for the stability of international energy markets and the broader geopolitical landscape. As of May 16, 2025, negotiations between the two nations, mediated by Oman and supported by regional players like Qatar, appear to be nearing a critical juncture. President Donald Trump, speaking during a Middle East tour in Doha, Qatar, expressed optimism about the talks, stating, “We’re in very serious negotiations with Iran for long-term peace.” Yet, the path to an agreement remains fraught with challenges, as both sides grapple with entrenched positions, domestic pressures, and the shadow of past failures. The stakes are immense: a successful deal could ease tensions, stabilize oil markets, and offer Iran economic relief, while failure risks escalation, potentially plunging the region into deeper conflict.
The current round of talks, which began in April and culminated in a fourth session on May 10, 2025, has been described as both “encouraging” by U.S. Middle East Envoy Steve Witkoff and “difficult but useful” by Iran’s Foreign Minister Abbas Araghchi. These negotiations follow years of animosity, exacerbated by Trump’s decision in 2018 to withdraw from the Joint Comprehensive Plan of Action (JCPOA), the 2015 nuclear agreement that had offered Iran sanctions relief in exchange for stringent limits on its nuclear program. The U.S. exit and subsequent reimposition of sanctions devastated Iran’s economy, weakening its currency, fueling protests, and deepening a cost-of-living crisis. Iran, in turn, rolled back its JCPOA commitments, enriching uranium to 60 percent—far beyond the 3.67 percent limit set in the original deal, though still below the 90 percent needed for a nuclear weapon. The International Atomic Energy Agency has warned that Iran’s stockpile of near-weapons-grade uranium could produce six nuclear bombs, heightening global concerns.
Recent developments suggest a shift in Iran’s stance, driven by internal and external pressures. Ali Shamkhani, a top adviser to Supreme Leader Ayatollah Ali Khamenei, told NBC News that Iran is prepared to forgo nuclear weapons, dismantle its stockpile of highly enriched uranium, and limit enrichment to civilian levels under international supervision. “Yes,” Shamkhani replied when asked if Iran would sign a deal today if sanctions were lifted, adding, “If the Americans act as they say, for sure we can have better relations.” This openness marks a departure from Khamenei’s historical resistance to U.S. negotiations, reportedly softened by senior officials who framed a deal as essential to the regime’s survival. Iran’s economy, battered by sanctions and further strained by the collapse of its ally, the Assad regime in Syria, and the decimation of Hezbollah’s leadership by Israel, is in dire straits. These losses have weakened Tehran’s regional influence, making economic relief a pressing priority.
For the United States, the negotiations reflect a delicate balancing act. Trump, who has revived his “maximum pressure” policy, has oscillated between offering an “olive branch” and threatening severe measures, including driving Iran’s oil exports to zero. In Doha, he emphasized a diplomatic approach, stating, “We’re not going to be making any nuclear dust in Iran,” and suggested that a deal could avert military action. Yet, his administration’s demands remain stringent, with a key sticking point being whether Iran can continue low-grade uranium enrichment for civilian use or must dismantle its program entirely. Trump’s rhetoric underscores his broader goal: “Iran has sort of agreed to the terms,” he claimed, though he acknowledged that the specifics remain unclear. The U.S. has insisted that Iran must never develop nuclear weapons, a position Tehran publicly endorses, with Iran’s atomic energy chief Mohammad Eslami asserting, “Tehran does not seek nuclear militarisation.”
The oil market has already reacted to the prospect of a deal. On May 15, 2025, Brent crude futures fell 2.36% to $64.53 a barrel, and West Texas Intermediate futures dropped 2.42% to $61.62, driven by expectations that a U.S.-Iran agreement could boost Iranian oil exports by up to 1 million barrels per day. Tamas Varga, an analyst at PVM, noted, “The overnight development of a possible nuclear deal is the sole reason for the morning’s weakness.” However, he cautioned that OPEC+, led by Saudi Arabia, might mitigate the impact by slowing its planned production increases, having already boosted output by 411,000 barrels per day in May and June. The interplay between diplomacy and energy markets underscores the deal’s global ramifications, as a surge in Iranian oil could depress prices, affecting both producers and consumers.
Iran’s negotiations extend beyond the U.S., with talks scheduled in Istanbul on May 16, 2025, involving Britain, France, and Germany—the E3 powers that were part of the JCPOA. These discussions follow Araghchi’s warning of “irreversible” consequences if the E3 triggers the JCPOA’s “snapback” mechanism to reinstate UN sanctions, an option set to expire in October. Writing in Le Point, Araghchi expressed Iran’s readiness to “turn the page” with Europe, signaling a desire to rebuild trust. Yet, he remained firm on Iran’s red lines, stating at a book-signing in Tehran, “None of our nuclear enrichment facilities will be dismantled.” This insistence on maintaining civilian enrichment capacity complicates the talks, as the U.S. has at times demanded a complete halt to enrichment.
The negotiations are further shadowed by regional dynamics, particularly Israel’s influence. Shamkhani suggested that Israeli Prime Minister Benjamin Netanyahu’s push for military action against Iran’s nuclear facilities could derail a deal, stating, “If the Americans remove the Bibi effect, they can easily sign the deal.” Tensions between Trump and Netanyahu have surfaced, with the U.S. president reportedly favoring diplomacy over Israel’s hawkish stance. Qatar, praised by Trump as a key intermediary, has played a critical role in facilitating talks, leveraging its relationships with both the U.S. and Iran. Meanwhile, Iran has floated an innovative proposal for a joint nuclear-enrichment venture with Arab countries and U.S. investment, allowing low-grade enrichment for civilian use. Though dismissed by Witkoff’s spokesman, the idea reflects Tehran’s attempt to reconcile its nuclear ambitions with international demands.
Both sides face domestic constraints that could undermine progress. In Iran, hardliners may resist concessions, especially after President Masoud Pezeshkian’s defiant response to Trump’s threats: “He thinks he can come here, chant slogans, and scare us. For us, Martyrdom is far sweeter than dying in bed.” Public frustration with economic hardship, however, may pressure the regime to prioritize sanctions relief. In the U.S., Trump’s diplomatic overtures could face skepticism from congressional hawks and allies like Israel, who distrust Iran’s intentions. Sanam Vakil of Chatham House observed, “Both sides are trying to message intent and show real clear interest in securing a deal,” but cautioned that even an agreement in principle would require time to finalize.
The talks represent a rare opportunity to de-escalate a decades-long conflict, but the road ahead is precarious. Iran’s insistence on enrichment rights, coupled with U.S. demands for robust verification, creates a narrow path to compromise. Araghchi’s assertion that “enrichment is an issue that Iran will not give up” but that “its dimensions, levels or amounts might change for a period to allow confidence-building” suggests potential flexibility, yet the devil lies in the details. The U.S. and Iran have exchanged written notes through Oman, a process Vakil described as designed to “signal positivity to keep momentum.” However, reports of a U.S. “written proposal” were denied by Araghchi, who clarified, “We have not been given anything,” highlighting the fragility of trust.
A successful deal could transform the Middle East, offering Iran a lifeline to rebuild its economy and the U.S. a chance to prevent a nuclear-armed Iran without resorting to war. For oil markets, increased Iranian supply could stabilize prices, though OPEC+’s response will be critical. Yet, failure risks catastrophic consequences, from heightened military tensions to a global proliferation crisis, as Araghchi warned. Trump’s vision of Iran becoming “a great country” without nuclear weapons hinges on both sides’ willingness to compromise. As Shamkhani noted, “It’s still possible. If the Americans act as they say, for sure we can have better relations.” Whether this olive branch can overcome years of barbed wire remains uncertain, but the world watches closely as these “very serious negotiations” unfold.
With reporting by Agence France-Presse, BBC, NBC News, The New York Times, and Reuters

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