Unresolved Strait Standoff, Rising Risk of Conflict

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Summary:

Donald Trump is considering limited strikes on Iran; three major sticking points remain in U.S.–Iran negotiations...

Key Highlights

1. Talks end without results as the U.S. and Iran harden positions over the Strait of Hormuz

2. Trump considers limited military strikes against Iran

3. Iran’s Revolutionary Guard: Non-military vessels allowed to pass through the Strait of Hormuz

4. South Korea to maintain “emergency mode”

5. Three major sticking points in U.S.–Iran negotiations

6. Three possible scenarios for Iran: negotiation window, fighting while negotiating, or escalation

7. No meaningful recovery in shipping traffic through the Strait of Hormuz after ceasefire announcement

Detailed Developments

Talks End Without Results; U.S. and Iran Harden Positions on the Strait of Hormuz

U.S.–Iran talks in Islamabad concluded on the 12th without any agreement. Iran stated that negotiations took place in an atmosphere of distrust and suspicion, with disagreements on several key issues. The U.S. said it had clearly defined its red lines, which Iran refused to accept.

Trump announced that the United States would immediately initiate a naval blockade of the Strait of Hormuz, preventing any vessels from entering or exiting the waterway.

Iran’s military emphasized that all vessel movements in the Strait are under strict surveillance and full control by its armed forces, warning that any miscalculation would result in severe consequences for adversaries.

Trump Considers Limited Strikes on Iran

Following the collapse of U.S.–Iran peace talks led by Vice President J.D. Vance, Trump is considering resuming limited military strikes while enforcing a blockade of the Strait of Hormuz.

According to officials and informed sources, Trump has also considered a full-scale bombing campaign, but this option is viewed as less likely due to the risk of escalating regional instability and his reluctance to enter a prolonged conflict.

He may instead opt for a temporary blockade while pressuring allies to assume responsibility for long-term naval escort missions in the Strait.

After the breakdown of talks in Pakistan, Trump spent most of Sunday at his private resort in Doral, Florida, where he participated in a Fox News program, played golf, and consulted with advisors.

Aides noted that despite announcing the blockade and threatening strikes on Iranian infrastructure, Trump remains open to a diplomatic solution. He stated in an interview that while he does not wish to take such action, Iranian maritime zones, desalination facilities, and power plants are highly vulnerable targets.

Iran’s Revolutionary Guard: Non-Military Vessels Allowed Passage

On April 12 (local time), Iran’s Islamic Revolutionary Guard Corps issued Announcement No. 59, stating that non-military vessels may pass through the Strait of Hormuz provided they comply with specific navigation protocols.

The statement warned that any military vessel approaching the Strait under any pretext would be considered a violation of the ceasefire agreement and would face a firm and forceful response from the IRGC Navy.

South Korea to Maintain “Emergency Mode”

South Korea’s presidential office stated on the 12th that, due to the failure of U.S.–Iran negotiations, the government will maintain its current “emergency mode” to mitigate the economic impact of Middle East tensions.

Officials held a meeting to coordinate response measures. A spokesperson said participants agreed that uncertainty remains high for the Korean economy under current global conditions.

Even if an agreement is reached, restoring global oil transport and repairing Middle Eastern energy infrastructure will take considerable time.

Authorities confirmed that emergency measures will remain in place until the conflict is fully resolved, with President Lee Jae-myung continuing to chair emergency economic meetings.

Three Major Sticking Points in U.S.–Iran Negotiations

According to a report by The New York Times citing Iranian officials, three key issues remain unresolved:

Reopening the Strait of Hormuz

Uranium enrichment

Unfreezing Iran’s overseas assets

The U.S. has demanded that Iran immediately reopen the Strait to all maritime traffic, but Iran has refused to relinquish control, stating it would only do so under a final peace agreement.

Iran has demanded compensation for airstrike damages and the release of frozen oil revenues held in multiple countries, which the U.S. has rejected.

Another major issue is Trump’s demand that Iran surrender or sell its near weapons-grade enriched uranium stockpile. Iran has submitted a counterproposal, but no compromise has been reached.

Three Possible Scenarios for the Iran Situation

Following the breakdown of talks, three potential paths are emerging:

1. Continued Ceasefire and Negotiation Window

Despite the lack of breakthroughs, talks have not fully collapsed. Both sides signal willingness to continue negotiations, leaving room for temporary agreements such as partial ceasefires or limited sanctions relief.

2. Fighting While Negotiating

With significant differences on key issues, a prolonged phase of intermittent conflict and negotiation is likely. Constraints such as rising costs and domestic pressure may limit large-scale military escalation.

3. Major Escalation of Conflict

If negotiations fail to meet U.S. objectives, the possibility of a broader escalation—potentially involving joint action with Israel—cannot be ruled out. The U.S. is currently increasing troop deployments in the Middle East.

Shipping Through the Strait of Hormuz Shows No Real Recovery

According to an interview with Richard Mead, editor-in-chief of Lloyd’s List, shipping traffic through the Strait of Hormuz has not meaningfully recovered since the ceasefire announcement.

Iran continues to exert firm control over the Strait, requiring vessels to report to the IRGC before passage. Without Iranian approval, ships are not allowed to transit.

Only a handful of vessels have been tracked exiting the Strait, and overall activity remains subdued. Approximately 600 large ocean-going ships remain stranded, with most operators waiting for clearer conditions before resuming transit.

The shipping industry is largely in a wait-and-see mode, seeking clarity on future navigation conditions and security risks.

Today’s Key Events to Watch

20:00 (UTC+8) Speech by ECB Vice President Luis de Guindos

22:00 (UTC+8) U.S. March Existing Home Sales (annualized)

TBD (UTC+8) OPEC monthly oil market report

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