US, Iran and the missing endgame

As the conflict in West Asia settled into a more complex reality, Tehran has become increasingly inclined towards negotiations, in contrast to its initial hardline stance. US President Donald Trump, in his UN General Assembly speech, threatened Iran, only to dismiss an Iranian proposal for a seven-day roadmap to cease hostilities.

With the US midterms approaching, Trump is not allowing Iran to leverage the elections against him. Iran, too, appears to be losing leverage as the Strait of Hormuz, its primary economic weapon, starts showing signs of recovery. Tracking data shows that crude exports from West Asia rebounded in September, with shiploads through the Strait and alternative routes amounting to nearly 80 percent of prewar levels, the highest since February.

Saudi Arabia has repaired the East-West pipeline, damaged by a drone strike, and has resumed oil exports via the Red Sea. However, Iran has been unable to export crude through the Strait due to the US counterblockade, and the Iranian oil that is available for sale is bound to run out. The weakening of Iran’s economic chokehold, coupled with a wave of new US sanctions, dubbed Operation Economic Outcast, has led to Tehran’s sudden willingness to engage in talks.

Despite the high inflation and shortages of goods, gasoline, and electricity, there are no clear signs that financial pain is translating into decisive pressure on the Iranian leadership. For a deadlock to be broken, both sides must compromise, or they risk an extended stalemate.