• President Trump said he doesn't know if Iran will 'give up yet,' rejecting a proposal tied to a cease-fire and phased reopening of the Strait of Hormuz.
  • The Iranian rial has plunged to a record low above 2.5 million per dollar, while diesel markets face supply shocks exceeding those from the Russia-Ukraine war.
  • Washington sanctioned 10 individuals and entities across Iran, Hong Kong, and Pakistan in 'Operation Economic Outcast,' targeting weapons procurement networks.

President Trump said Iran is "doing very poorly" and that he doesn't know if Tehran is ready to capitulate, as indirect negotiations over the Islamic Republic's nuclear program remain stalled and economic pressure intensifies.

Trump rejected an Iranian proposal tied to a cease-fire and a phased reopening of the Strait of Hormuz, according to people familiar with the matter. Iran's foreign minister, Abbas Araghchi, has said a negotiated outcome is the only viable path to end the confrontation. The two sides remain far apart: Washington has prioritized nuclear concessions, while Tehran has focused on ending military pressure and lifting restrictions on its oil trade and shipping.

The president also publicly denied reporting that his administration had offered sanctions relief or access to frozen Iranian funds in exchange for progress on the nuclear file, writing that he had offered Iran "NOTHING."

A Currency in Freefall

The economic toll is mounting rapidly. The Iranian rial fell to a record low, with Tehran-market trading above 2.5 million rials per U.S. dollar, according to the Associated Press. The combination of sanctions, oil-trade restrictions, and active conflict has contributed to what AP describes as an unprecedented economic decline. For ordinary Iranians, that means inflation, shortages, and a diminished ability to import essential goods or conduct international transactions.

On September 29, the U.S. Treasury sanctioned 10 individuals and entities in Iran, Hong Kong, and Pakistan that it says helped procure weapons and components for Iran's defense ministry. The action is part of "Operation Economic Outcast," a broader campaign to disrupt Iran's financial and military-support networks. Treasury calls it a whole-of-government effort.

Hormuz Risk Premium Builds

The Strait of Hormuz remains the central pressure point. It is a major artery for oil, refined fuels, and fertilizer, and any threat to shipping through it can raise energy costs globally and disrupt supply chains. Diesel markets have been particularly strained. Reporting cited by the Japan Times says the Iran conflict has removed more diesel supply from world markets than the Russia-Ukraine war, contradicting Trump's assertion that the latter is the main source of the price increase.

Secondary effects are spreading across the region. Treasury Secretary Scott Bessent said some banks in the UAE and Turkey had stopped Iranian transactions, while airlines in Turkey, Oman, and the UAE had halted certain Iranian-airline flights. Gulf states and regional businesses face greater exposure to shipping disruptions, financial de-risking, and air-traffic constraints.

Two Tracks, Narrow Space

The administration is operating on two tracks: military and diplomatic pressure, and economic isolation. Trump has said he faces a choice between reaching a deal and escalating attacks, and has indicated any agreement would need to address U.S. concerns about Iran's nuclear program. Iran denies pursuing a bomb and argues its nuclear activities are civilian, saying U.S. military action and economic coercion are the core obstacles to peace.

Iran filed a complaint to the United Nations condemning Trump's threats as incompatible with the UN Charter. U.S. officials maintain that pressure is necessary for regional security and nuclear nonproliferation.

A deal would likely require phased steps rather than a single comprehensive settlement—such as reduced disruption to commercial shipping, monitored nuclear commitments, and some form of sanctions or financial relief. But Trump's public denial that he has offered concessions suggests the negotiating space is currently narrow. Without a breakthrough, energy and shipping markets will remain highly sensitive to every sign of progress or deterioration.

Representatives for the White House and Iran's mission to the United Nations did not immediately respond to requests for comment.

Correction: An earlier version of this article misstated the date of the Treasury sanctions. It was September 29, not September 19.