Hopes for a Middle East Ceasefire Emerge as U.S. Tariff Escalation Adds to Energy Risks

Daily News

Summary:

Reports suggest that Iran was the first to propose a 10-day ceasefire, while Canadian Prime Minister Mark Carney said Canada would consider all available options in response to the latest U.S. tariff measures.

Highlights

1. Reports say Iran was the first to propose a 10-day ceasefire, while the U.S. demands a preliminary agreement on freedom of navigation through the Strait.

2. Iranian military warns that any U.S. strike on Iran's nuclear facilities will trigger retaliation against all U.S. interests across the Middle East.

3. New UK Prime Minister Andy Burnham authorizes the use of British bases for certain U.S. strikes against Iran.

4. Trump says the U.S. will take action if the Houthis blockade the Red Sea.

5. Trump says the U.S. will soon launch a major strike on Iran's Koh Mountain nuclear facility.

6. Canadian Prime Minister says all options remain on the table in response to new U.S. tariffs.

Details

Reports Say Iran Was the First to Propose a 10-Day Ceasefire, While the U.S. Demands a Preliminary Strait Agreement

According to The Jerusalem Post, citing two sources familiar with the matter, the ongoing proposal for a 10-day ceasefire between the United States and Iran was initially put forward by Tehran, underscoring Iran's urgency in seeking a halt to hostilities. The proposal aims to create a window for negotiations over the Strait of Hormuz.

Mediators—including senior officials from Qatar, Egypt, Oman, and Pakistan—have presented the proposal to Washington while also suggesting the establishment of a "transit corridor" to ensure the safe passage of commercial vessels. The United States is reportedly seeking a longer ceasefire period and insists that at least a partial agreement on freedom of navigation through the Strait be reached before the ceasefire takes effect, with the remaining details to be finalized within the following 10 days.

However, some Trump administration officials reportedly consider Iran's proposal unrealistic. A U.S. official also said that President Trump remains committed to holding Iran accountable for violating the previous memorandum of understanding and for the deaths of U.S. service members.

Iranian Military Warns of Retaliation if U.S. Strikes Nuclear Facilities

In the early hours of July 22 local time, Iran's Khatam al-Anbiya Central Headquarters issued a statement warning that U.S. threats to attack Iran's nuclear facilities and other sensitive sites would be viewed as an expansion of the regional conflict. Should such an attack occur, Iran declared that all U.S. and allied interests throughout the Middle East would become legitimate targets for powerful retaliatory strikes by the Iranian Armed Forces.

Meanwhile, sources said the Trump administration plans to impose new tariffs on goods from dozens of economies no later than Friday, ensuring that its tariff framework remains in place after the temporary 10% global tariff expires. Last month, the administration proposed imposing tariffs of at least 10% on imports from 60 trading partners, citing concerns over forced labor. Officials are preparing to implement the measures before the end of the week, although the final tariff rates have yet to be confirmed.

New UK Prime Minister Andy Burnham Approves Use of British Bases for Certain U.S. Strikes on Iran

Newly appointed UK Prime Minister Andy Burnham has approved the use of British military bases for what the UK describes as defensive U.S. strikes against Iran. Despite President Trump's intensified military posture toward Iran, Burnham has maintained the policy established by his predecessor, Keir Starmer.

According to people familiar with the matter, Starmer chaired a meeting of senior ministers and officials last Friday to review the UK's policy following the resumption of U.S. military operations earlier this month. Participants agreed to continue allowing U.S. aircraft to operate from Diego Garcia in the Indian Ocean and RAF Fairford in Gloucestershire, England, to counter Iranian missile threats and strike locations associated with targeting the Strait of Hormuz.

Trump: The U.S. Will Act if the Houthis Blockade the Red Sea

During a meeting at the White House on July 21 with visiting Lebanese President Joseph Aoun, U.S. President Donald Trump said the United States would take action if Yemen's Houthi movement blocks the Red Sea.

Commenting on the possibility of a blockade, Trump said such a scenario had not yet materialized, but if it did, "we will take action and deal with it."

On July 20, the Houthis announced an immediate maritime blockade against Saudi Arabia. In response, the Saudi-led coalition stated that it had taken measures to safeguard commercial shipping through the Bab el-Mandeb Strait and would respond decisively to any threats posed by the Houthis.

Regarding Lebanon, Trump said he is willing to engage in dialogue with Hezbollah and would discuss assistance to Lebanon with President Aoun while coordinating broader international support.

Trump Says the U.S. Will Soon Launch a Major Strike on Iran's Koh Mountain Nuclear Facility

Speaking to reporters during his meeting with Lebanese President Joseph Aoun at the White House on July 21, President Trump said the United States would soon launch a powerful strike against Iran's underground Koh Mountain facility, located south of Natanz.

The facility is believed to be a heavily fortified underground complex. Iran informed the International Atomic Energy Agency (IAEA) in 2020 that the site would eventually be used to assemble centrifuges required for nuclear fuel production.

Trump also stated in an interview last week that the United States could take action against the facility "very soon." According to media reports, Israeli officials believe that following the 12-day Iran-Israel conflict last June, Iran relocated advanced centrifuges and part of its stockpile of highly enriched uranium to the underground site.

Canadian Prime Minister: All Options Under Consideration in Response to New U.S. Tariffs

On July 21 local time, Canadian Prime Minister Mark Carney said he had spoken with U.S. President Donald Trump following Washington's announcement of new tariffs. Carney stated that if the new measures take effect, Canada will consider every available response.

The White House announced on July 20 that the United States will impose an additional 50% ad valorem tariff on selected Canadian products in response to what it described as Canada's discriminatory measures affecting trade in automobiles and auto parts.

A White House fact sheet indicated that products such as wine, hockey sticks, and cement would be subject to the new tariffs, even if they qualify under the United States-Mexico-Canada Agreement (USMCA). According to the White House, the measures are intended to offset the burden and competitive disadvantages imposed on U.S. businesses by Canada's discriminatory trade practices. The new tariffs are scheduled to take effect on August 19 (U.S. Eastern Time).

Today's Focus

20:15 (UTC+8) European Central Bank Interest Rate Decision (July)

20:30 (UTC+8) Canada May Retail Sales MoM

20:45 (UTC+8) ECB President Christine Lagarde's Monetary Policy Press Conference

22:00 (UTC+8) Eurozone July Consumer Confidence (Preliminary)

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