Rubio Meets Gulf Leaders After Rocky Start to US-Iran Talks
(Bloomberg) — US Secretary of State Marco Rubio met the leaders of the United Arab Emirates and Kuwait on Wednesday, as he looks to reassure Persian Gulf allies of the strength of an interim peace agreement with Iran.
Rubio met UAE’s President, Sheikh Mohamed bin Zayed Al Nahyan, in Abu Dhabi before departing for Kuwait. He will end the day in Bahrain, as part of a tour that follows the start of US-Iran negotiations to secure a more formal resolution to their near four-month war.
An initial round of discussions between Washington and Tehran has been completed and further talks are set to take place in Switzerland next week, according to a foreign ministry spokesperson in Pakistan, one of the main mediators.
Rubio’s meetings are taking place during a week of claims and counter-claims about the progress of the negotiations.
President Donald Trump reiterated on Wednesday that Tehran will only be able to use billions of dollars of funds released from frozen accounts to buy food from the US. On Tuesday, he said the Islamic Republic had agreed to allow International Atomic Energy Association inspections of its nuclear sites.
Iran contradicted both statements, in just one example of the two sides making conflicting assertions about key issues at the start of what’s slated to be a 60-day negotiation period.
On the issue of inspections, IAEA Director General Rafael Mariano Grossi played down what he called a “war of words” and said he’s confident the watchdog’s monitors would gain full access at some point.
The back-and-forth runs alongside uncertainty over the future management of the Strait of Hormuz.
Qatar’s Prime Minister Sheikh Mohammed bin Abdulrahman Al Thani traveled to Muscat on Wednesday to take part in discussions involving Iran, Gulf states and Iraq, according to a person briefed on the discussions, who asked not to be identified as the matter isn’t public.
Iran and Oman said Tuesday they’ll begin work on an agreement over the future administration of the waterway, including the cost of managing transit.
Energy traders and shipowners are concerned over the prospect of tolling. The industry has warned such fees would break with international maritime law and set a dangerous precedent that could be mirrored in other waterways.
“No country is allowed to charge tolls or fees on an international waterway,” Rubio said on arrival in Abu Dhabi on Tuesday. “That’s the way we expect it’ll be here.”
Trump also weighed in, saying on Truth Social that there are “no tolls, no insurance costs and no other charges of any kind being sought or received by Iran on ships traveling the Strait of Hormuz.”
His comments didn’t refer to any plans Iran or Gulf countries may have for future management of the chokepoint.
For now, more ships are transiting the Strait of Hormuz with their satellite signals switched on, pointing to growing confidence about sending vessels through the world’s most important energy chokepoint.
Oil prices continued to fall on Wednesday, with Brent crude below $75 a barrel for the first time since the Iran war began. That’s down from a high of around $125 in late April. The global benchmark is currently trading 4.5% down at $73.53.
Another outstanding issue is Israel’s war with Iran-backed Hezbollah in Lebanon, which Iran has said must end for any permanent deal to be agreed. Israel says it needs to maintain a military presence in southern Lebanon to protect its northern communities from the militant group, a stance Iran cites as a breach of the interim agreement.
A fifth round of US-mediated talks between Israel and Lebanon is taking place in Washington this week. Discussions have been complicated by the terms of the US-Iran deal, according to Israel’s ambassador to the United Nations, Yechiel Leiter.
Israel sees the disarmament of Hezbollah and its withdrawal from south Lebanon as a baseline for discussions, the ambassador said in a written statement.
“Let me be clear: Israel will act against both immediate and emerging threats to its citizens and soldiers,” he said.
Trump’s comments on the state of the Iran negotiations underscore the US president’s defensiveness over the deal as it draws criticism, including from defense hawks in his own party.
His insistence that released funds will be spent on US agricultural products could appeal to farmers, a key Republican constituency, ahead of November’s midterm elections.
The Republican-led Senate voted Tuesday to end the conflict, in a rare symbolic rebuke of Trump. While the resolution is unlikely to force any changes in the administration’s strategy, it represents the latest sign that the president’s approach lacks domestic support.
Some critics of the memorandum of understanding signed last week fear the Islamic Republic instead will use the money to rebuild its armed forces and continue to support militant groups such as Hezbollah.
Iran says $12 billion of its frozen funds are set to be released in two equal installments, according to a report by the Mehr news agency that cited Deputy Foreign Minister Kazem Gharibabadi. The US is yet to confirm how much the Islamic Republic will get.
–With assistance from Galit Altstein.
(Updates with Trump comment in fifth paragraph, Hormuz latest in ninth.)
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