Iran 60-day deadline has passed. What does Trump do now?

The 60-day deadline set by Donald Trump for the Iran deal has expired, leaving the US president with a critical decision to make. Initially, the memorandum of understanding signed in June was intended to ease tensions, reopen the Strait of Hormuz, and initiate negotiations towards a permanent resolution of the nuclear program dispute.

However, six months later, none of these objectives have been realized. Instead, tensions have escalated, with Iran maintaining control over Hormuz and failing to engage in productive nuclear talks. The US and Iran now seem more intent on pressuring each other to yield first rather than seeking a diplomatic solution.

Strategist Ali Vaez of the International Crisis Group described the situation as a "game of chicken," with the US attempting to "bring Iran to its knees" and Iran unwilling to make concessions. Trump faces three potential paths forward, each with its own risks and challenges.

First, he could wait for Iran's economy to collapse under the weight of sanctions and the blockade. This approach aims to force Tehran to return to the negotiating table on American terms, but experts warn that past economic pressure campaigns have only hardened Iran's resolve. Another significant risk is that Iran may refuse to back down, prolonging the crisis and causing further economic hardship for the US and the global economy.

Second, Trump may opt to escalate militarily. While there have been no reported strikes since the deal expired, renewed attacks could increase pressure on Iran and potentially force concessions. However, this strategy carries the risk of Iranian retaliation against American forces and regional allies, depleting US munitions, and causing further energy market volatility around the time of the US midterm elections.

Finally, diplomacy remains an option for Trump, though it may be the most politically challenging. Iran has insisted on several concessions before reopening Hormuz, including an end to the US blockade, withdrawal of American forces, and reparations for war damage. Trump has rejected these demands, insisting that Iran should cover the costs of US actions.

Despite this, there is still diplomatic activity, with Pakistan continuing to facilitate talks between the two countries. However, finding common ground on Iran's terms for Hormuz's reopening will likely prove difficult, as claims of Iran's victory under a compromised deal could further entrench the regime's position.