The world urgently needs a US-Iran deal now

Summary

The world urgently needs a US-Iran deal now Without a deal between Washington and Tehran, the fallout from Hormuz closure could deepen global energy, food and cost-of-living crises. As negotiations between the United States and Iran appear to move towards a possible breakthrough, the stakes extend far beyond diplomacy between two longstanding adversaries. At issue is not simply a ceasefire or a nuclear agreement. It is whether the world economy can avoid sliding deeper into widening energy, food and cost-of-living crises centred on the Strait of Hormuz. Recent reports suggest Washington and Tehran are discussing a deal that would reopen the strait as part of a broader arrangement. The proposal reportedly includes a 60-day truce, the reopening of shipping lanes, some sanctions relief and renewed talks on Iran’s nuclear programme. The urgency is obvious. Roughly a fifth of the world’s oil and a substantial share of liquefied natural gas supplies normally pass through the Strait of Hormuz. Over recent weeks, disruptions to shipping, military tensions and competing naval controls have driven up freight costs, energy prices and insurance premiums. If a durable agreement is not reached soon, the consequences are likely to spread rapidly across the global economy. To be sure, wealthier economies will feel the effects. Higher fuel prices will intensify inflationary pressures already weighing on households in Europe and North America. Governments confronting slowing growth and persistent cost-of-living concerns will face renewed political pressure as transportation, electricity and food prices rise once again. But the effects will be far more severe in the Global South. Many developing economies remain deeply dependent on imported fuel, imported fertiliser and imported food. Energy shocks, therefore, cascade through entire economies. Transport costs rise. Agricultural production becomes more expensive. Food inflation accelerates. Public finances deteriorate as governments try to shield populations from rising prices through subsidies or emergency support. This dynamic is already visible. Across several import-dependent countries in Africa and South Asia, governments are scrambling to secure alternative fuel supplies while confronting worsening fiscal pressures. The longer the uncertainty around the Strait of Hormuz continues, the greater the likelihood that inflationary shocks will deepen existing debt crises and social instability. Indeed, the global economy remains extraordinarily vulnerable to narrow geopolitical chokepoints. The Strait of Hormuz is not simply a regional waterway; it is one of the central arteries of global capitalism. When it becomes militarised or partially blocked, the consequences reverberate worldwide within days. Food prices are especially sensitive to these disruptions because energy markets and food systems are tightly interconnected. Fertiliser production depends heavily on natural gas. Shipping and refrigeration costs depend on oil prices. When energy markets are destabilised, grocery bills rise almost everywhere. This is why the current negotiations matter so profoundly. The issue is not only whether the US and Iran can avoid further military escalation. It is also whether a fragile global economy already strained by debt, climate shocks and geopolitical fragmentation can withstand another prolonged energy disruption. Recent years have demonstrated how quickly such shocks become political crises. Food inflation played a major role in unrest preceding the Arab uprisings more than a decade ago. More recently, rising living costs have fuelled political volatility from Latin America to Europe. Governments across the world are already confronting widespread distrust, stagnant wages and growing inequality. Another sustained surge in energy and food prices could intensify these pressures dramatically. The irony, once again, is that many of the countries likely to suffer most have little influence over the conflict itself. The populations now facing the gravest economic risks are often those least responsible for the geopolitical confrontation, yet they are the ones most exposed to rising import costs, worsening hunger and shrinking fiscal space. The global economy repeatedly externalises the costs of major-power conflict onto poorer societies through commodity markets and debt structures. Accordingly, reopening the Strait of Hormuz is not simply a matter of strategic stability for Washington or Tehran. It is also a global economic necessity. This does not mean the negotiations will be easy. Deep disagreements remain over sanctions, uranium enrichment, regional security arrangements and the future governance of shipping through the Gulf. Reports also indicate continuing tensions over who would ultimately control transit through the Strait of Hormuz and under what conditions. Nor is there any guarantee that a ceasefire would hold. Previous rounds of negotiations have repeatedly stalled amid renewed military escalation and mutual distrust. Yet the alternative is increasingly dangerous. A prolonged disruption in the Strait of Hormuz would not remain a regional crisis for long. It would deepen inflation, worsen food insecurity, strain humanitarian systems and increase the likelihood of broader political instability across vulnerable economies already under immense pressure. In that sense, the negotiations now under way are about far more than diplomacy between the US and Iran. They are about whether the world can avoid another cascading global crisis driven by energy insecurity, geopolitical fragmentation and rising inequality. The Strait of Hormuz cannot remain closed – economically or politically – without consequences for everyone. The views expressed in this article are the author’s own and do not necessarily reflect Al Jazeera’s editorial stance.

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Ilan KapoorBy Ilan Kapoor

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US-Iran Peace Deal Live: Iranian President to visit Pakistan on Tuesday as peace talks yield 60-day roadmap

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Advertisement US-Iran peace deal US-Iran Peace Deal Live: Iranian President to visit Pakistan on Tuesday as peace talks yield 60-day roadmap New Delhi,UPDATED: Jun 22, 2026 19:20 IST US-Iran Peace Deal News Live Updates: US-Iran diplomacy gained momentum after a marathon round of talks in Switzerland produced what mediators Pakistan and Qatar described as a roadmap for a final agreement within 60 days.

US Vice President JD Vance said Tehran had agreed to allow nuclear inspectors into the country and work on mechanisms covering frozen Iranian assets, regional ceasefires and the Strait of Hormuz. Vance said discussions on nuclear inspections could begin as early as this week, while technical teams will remain engaged even after Iran's top negotiators returned to Tehran following 18 hours of intensive negotiations.

The talks also established a communication channel to help ensure safe commercial shipping through Strait of Hormuz and a mechanism aimed at preventing renewed fighting in Lebanon between Israel and Hezbollah. Despite the diplomatic progress, tensions remained visible.

Iran had briefly closed the Strait of Hormuz over the weekend, accusing the United States of failing to uphold commitments to halt fighting in Lebanon. However, mediators said discussions were held in a constructive atmosphere and yielded encouraging progress.

Iranian President Masoud Pezeshkian is set to visit Pakistan on Tuesday in a trip expected to focus on bilateral cooperation and follow-up discussions on Islamabad's mediation efforts. Meanwhile, a fragile ceasefire in Lebanon largely held, marking the longest lull in violence in three months of conflict.

Lebanese officials reported near-total adherence to the truce despite isolated incidents, while Israeli leaders insisted any final agreement must ensure Iran cannot use future financial relief to support military activities or regional proxy groups.

Follow IndiaToday.in for the latest updates....Read More Iranian President Masoud Pezeshkian is expected to arrive in Pakistan on a one-day visit on Tuesday. (File Photo: Press TV) 2 Jun 22, 2026 19:20 IST US-Iran Deal: Iranian President to visit Pakistan Iranian President Masoud Pezeshkian will make a one-day visit to Pakistan on Tuesday, Iranian officials said.

Habib Abbasi, director-general of public relations at the presidential office, said the trip will focus on implementing previous agreements and exploring new trade opportunities. Pezeshkian is also expected to "express appreciation" for Pakistan's role in mediating between Iran and the United States, according to Tasnim news agency.

Jun 22, 2026 19:14 IST US-Iran Deal: Here's what happened so far - US Vice President JD Vance said talks with Iran made significant progress, with Tehran agreeing to allow nuclear inspectors, establish mechanisms for handling frozen assets and support efforts to manage regional ceasefires.

- Speaking after negotiations in Switzerland, Vance said discussions on nuclear inspections could begin as early as this week and confirmed that technical talks would continue in the coming days and weeks. - Iran’s senior negotiating team departed Switzerland for Tehran after 18 hours of intensive discussions, while technical experts remained behind to continue work on the Islamabad memorandum of understanding.

- Pakistan and Qatar, which mediated the talks, said Washington and Tehran agreed on a roadmap aimed at reaching a final agreement within 60 days and described the first round of negotiations as encouraging. - The two sides also agreed to establish a mechanism to help prevent clashes in Lebanon and create a communications channel to safeguard commercial shipping through the Strait of Hormuz, a vital route for global oil supplies.

- The talks followed an interim agreement reached last week and continued despite renewed tensions after President Donald Trump threatened military action against Iran and Tehran warned Washington over its rhetoric. - Iranian President Masoud Pezeshkian is scheduled to visit Pakistan on Tuesday for a one-day trip.

Iranian officials said he would discuss bilateral cooperation and express appreciation for Islamabad’s role in facilitating US-Iran diplomacy. - A ceasefire in Lebanon largely held on Monday, marking the longest period of relative calm in nearly three months of conflict between Hezbollah and Israel, although isolated incidents were still reported.

- Lebanese security officials said adherence to the ceasefire had been "almost total" since Saturday evening, despite reports of limited Israeli military activity in southern Lebanon and drone flights over Beirut. - The conflict in Lebanon has remained a major test for the interim US-Iran agreement, with Tehran previously accusing Washington of failing to ensure an end to hostilities and briefly reimposing restrictions in the Strait of Hormuz.

- Vance said progress had also been made toward reducing tensions in Lebanon, while negotiators worked to establish safeguards aimed at preventing future escalation. - Iranian Foreign Minister Abbas Araqchi said Tehran had secured waivers for oil and petrochemical exports, the release of some frozen assets and the launch of a reconstruction and development programme under the broader diplomatic framework.

- Oil prices, which surged after tensions disrupted shipping through the Strait of Hormuz, fell further after the latest round of talks, easing concerns about global supply disruptions. - Pakistani Prime Minister Shehbaz Sharif described the negotiations as constructive and said the first round of talks had concluded successfully, laying the groundwork for a broader peace agreement.

- Israeli officials signalled support for a diplomatic resolution but stressed that any final deal must ensure Iran cannot use financial relief or released assets to fund military activities or regional proxy groups.

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