• Iran has sent the U.S. an updated reply to a draft peace proposal, keeping diplomatic channels open despite lingering tensions.
  • The U.S. recently reintroduced nuclear conditions into the talks, including limits on uranium movement and nuclear activity during negotiations.
  • Both sides remain skeptical of each other's intentions, with Washington maintaining military pressure and reviewing next steps.

New Response in Hand

Iran delivered an updated response to a U.S. draft peace proposal on May 1, 2026, signaling that diplomatic avenues remain active even as hostilities continue in the region. The move comes after Washington amended its earlier proposal to include specific nuclear-related conditions, according to people familiar with the matter. Tehran had earlier floated a counterproposal that included reopening the Strait of Hormuz while postponing nuclear negotiations—a condition the U.S. rejected.

"This is a fragile process, but it's still moving," a person close to the talks said. The person added that both sides have made attempts to reach a framework agreement, though gaps remain wide on core issues such as uranium enrichment levels and missile capabilities.

Nuclear Conditions Return to the Table

The U.S. amendments reintroduced demands that Iran limit its uranium stockpile and halt certain nuclear activities during the negotiation period—conditions that were part of earlier talks but had been shelved in recent months. Iran's latest response addresses these points, but it remains unclear whether it offers concessions or insists on its earlier position linking nuclear talks to broader security guarantees.

The back-and-forth underscores a negotiation pattern that analysts describe as "episodic," with periods of intense communication followed by stalemates. Oman has continued to serve as a key mediator, shuttling proposals between the two sides.

Market and Regional Implications

The diplomatic activity has kept energy markets on edge. The Strait of Hormuz, through which about a fifth of global oil and gas shipments pass, remains a flashpoint. Iran's earlier proposal to reopen the strait was seen as a potential confidence-building measure, but the U.S. did not accept the condition without progress on nuclear constraints.

"Markets are watching for any sign of de-escalation or, conversely, a breakdown that could lead to disruptions," said a Gulf-based analyst. Crude prices have been volatile in recent weeks, reflecting the uncertainty.

Skepticism Persists

Despite the exchange of proposals, officials on both sides have expressed doubt about the other's willingness to compromise. The U.S. has maintained military assets in the region and continues a pressure campaign, while Iran has continued attacks on shipping and regional targets. Without a deal, experts warn the situation could escalate further.

Repeated attempts to reach both U.S. and Iranian officials for comment were unsuccessful.

Clarification: An earlier version of this article incorrectly referred to the U.S. amendments as "new nuclear conditions." They were revisions to previously proposed terms.