U.S. and Iran Accuse Each Other of Violating Ceasefire as Oil Prices Return Near $100

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Summary:

The United States and Iran accuse each other of violating the ceasefire agreement; the European Central Bank may raise its inflation forecasts in June...

Key Headlines

1. The U.S. and Iran accuse each other of violating the ceasefire: Washington says the strikes were defensive, while Tehran calls them a serious breach

2. Senior Iranian lawmaker: Even if an agreement is reached, challenges in U.S.-Iran relations will remainI

3. sraeli forces cross the line and launch raids in southern Lebanon, escalating tensions ahead of a potential U.S.-Iran deal

4. U.S. Trade Representative Greer: Trump’s 10% global tariffs could be reimposed after expiring in July

5. Lane: The ECB may raise inflation forecasts in June

Details

U.S. and Iran Accuse Each Other of Violating the Ceasefire: Washington Says Strikes Were Defensive, Tehran Calls Them a Serious Breach

Iran on Tuesday accused the United States of blatantly violating the ceasefire through military operations in the southern province of Hormozgan and stated that it reserves the right to retaliate. The United States, however, argued that its targets included missile launch sites and vessels attempting to lay naval mines, insisting that the operation was entirely defensive in nature.

Meanwhile, U.S. Secretary of State Marco Rubio said that a final agreement to end the conflict could still take several more days. Previously, both sides had revealed progress on a memorandum of understanding aimed at halting hostilities, restoring navigation through the previously blocked strait, and giving negotiators 60 days to resolve complex issues such as Iran’s nuclear program.

Following the U.S. strikes, Rubio took a hardline stance, stating that the Strait of Hormuz must remain open under all circumstances. Amid escalating tensions, Brent crude futures rose more than 3.5% on Tuesday, climbing back near the $100-per-barrel level.

Senior Iranian Lawmaker: Even if an Agreement Is Reached, Challenges in U.S.-Iran Relations Will Remain

On May 25 local time, Ebrahim Azizi, chairman of the Iranian Parliament’s National Security and Foreign Policy Commission, reiterated in an interview that Americans are unlikely to act sincerely, as they are too accustomed to abandoning agreements.

Azizi stated that even if Iran and the United States reach an agreement through negotiations, it would not mean the conflict is over, nor would it mean that relations between the two countries would no longer face challenges. According to him, U.S. behavior itself proves that “everything is still far from over.”

He also stressed that Iran after the February 28 war is completely different from the Iran before it. Iran, he said, must prepare itself for this life-and-death struggle.

Israeli Forces Cross the Line and Launch Raids in Southern Lebanon, Escalating Tensions Ahead of a Potential U.S.-Iran Deal

Israeli media reported on the 26th that in response to Hezbollah’s continued drone attacks on Israel, Israeli forces have begun crossing the “Yellow Line” established under the April 17 ceasefire agreement and are conducting ground operations deeper inside Lebanese territory.

The Jerusalem Post reported that it remains unclear how far the Israeli military intends to advance. Citing Israeli military officials, the report stated that controlling certain positions beyond the “Yellow Line” could help reduce Hezbollah’s drone threat.

According to the report, the objectives of the operation remain uncertain. It may aim to gradually expand Israeli control over Lebanese territory and pressure Hezbollah into reducing drone attacks or even accepting partial disarmament. At the same time, it could serve to demonstrate to the Israeli public that the government and military are responding forcefully to security threats.

The report noted that the escalation between Israel and Lebanon comes as expectations grow that the United States and Iran may soon reach an agreement. A U.S.-Iran deal could further push for a broader ceasefire between Israel and Hezbollah.

U.S. Trade Representative Greer: Trump’s 10% Global Tariffs Could Be Reimposed After Expiring in July

According to reports, U.S. Trade Representative Jamieson Greer said on Tuesday local time that President Trump’s 10% global tariffs could potentially be reimposed after expiring in July. He noted that existing regulations do not clearly specify whether a president may reinstate such tariffs after the legal time limit expires.

Trump imposed the 10% global tariffs in February under Section 122 of the Trade Act of 1974. The tariffs can remain in effect for up to 150 days and were originally expected to be replaced by new tariffs after expiring in July.

Speaking at an event hosted by the Council on Foreign Relations, Greer said there may legally be authority to reimpose the tariffs, since the law only specifies the expiration period and does not clarify when they may be implemented again.

Greer did not say whether the Trump administration would seek to extend the tariffs, but he added that he could not imagine Congress intended to limit a president’s authority to use Section 122 tariffs to only once per presidential term.

Lane: The ECB May Raise Inflation Forecasts in June

Philip Lane, the European Central Bank’s chief economist, said in a speech on Tuesday that the ECB may raise its quarterly inflation forecasts in June. Compared with the assumptions made in March, oil prices could remain elevated for a longer period.

The ECB currently forecasts inflation to reach 2.6% in 2026. Lane noted that there could also be indirect effects beyond energy prices. If the energy shock evolves into a broader inflation problem, he warned, it would become a major issue.

Markets widely expect the ECB to raise its deposit rate by 25 basis points to 2.25% on June 11.

Today’s Focus

10:00 — Reserve Bank of New Zealand May Interest Rate Decision

11:00 — RBNZ Governor Breman Holds Monetary Policy Press Conference

16:00 — Switzerland May ZEW Investor Sentiment Index

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