• Vice President JD Vance signaled that the Trump administration is pursuing a permanent peace deal with Iran but has multiple alternatives if diplomacy fails.
  • The remarks come amid heightened tensions and ongoing negotiations, with U.S. officials emphasizing a range of military and economic options.
  • Markets are closely watching for impacts on oil prices and regional stability, though details on specific plans remain scarce.

Vance, speaking to reporters on Thursday, underscored the administration's preference for a diplomatic resolution but warned that President Donald Trump is prepared to explore other avenues. "If we can't secure a permanent peace that guarantees our security and regional stability, the president has a lot of options," Vance said, declining to elaborate on specifics. The comment comes as indirect talks between U.S. and Iranian officials continue in Oman, with European mediators facilitating discussions.

According to people familiar with the matter, the White House has been reviewing a range of contingency plans, including renewed sanctions pressure and potential military posturing. The administration has not publicly set a deadline for negotiations, but Vance's phrasing suggests a sense of urgency. "We're not going to wait indefinitely while Iran continues its nuclear activities and destabilizing behavior," a senior administration official added, speaking on condition of anonymity.

The backdrop is a complex geopolitical landscape: Iran's nuclear program has advanced, and its support for proxy groups across the Middle East remains a flashpoint. The Trump administration has taken a hardline stance, pulling out of the 2015 nuclear deal in 2018 and reimposing crippling sanctions. However, recent diplomatic overtures have raised cautious optimism.

Investors are eyeing the situation warily, with oil prices edging up 1.2% on Friday amid uncertainty. "The market is pricing in a risk premium," said an energy analyst at a major bank. "Any hint of military escalation could send prices sharply higher, but a deal would unlock significant upside."

Opposition lawmakers and some allies have urged restraint, while hawks within the administration advocate for a tougher stance. "Peace is preferable, but we cannot accept a bad deal," Vance said, echoing Trump's often-repeated mantra of "peace through strength."

Attempts to reach the Iranian mission to the UN for comment were unsuccessful. Vance's remarks are seen as a signal to both Tehran and domestic audiences that the administration is keeping all options on the table.

Correction: An earlier version of this article misstated the location of the talks as Oman; they are being held in Muscat. The text has been corrected.