US President Donald Trump said Iran would be bombed at a “much higher level” if it did not agree to a peace deal.
The president said the war would “end” if Iran agreed to the proposal, meaning the Strait of Hormuz would be “open to all.”
His post on Truth Social came after the market reacted to an Axios report that the US and Iran were close to a deal to end the two-month war.
The newspaper reported Wednesday that Washington expects answers from Tehran within the next 48 hours on several key points underlying the one-page memo.
As a result, oil prices plunged, but U.S. stock futures, European listed stocks, and global sovereign bonds rose.
In a post on Truth Social, the president warned that if Iran did not agree to the deal, “the bombing will begin and sadly at a much higher level and intensity than before.”
Prior to this post, a Pakistani government official told MS Now that “a proposal to end the war is very likely to be made within the next few days.”
Iran’s Foreign Ministry spokesperson told CNBC early Wednesday that it is “evaluating” the Article 14 peace proposal from the United States.
Axios reported that the deal includes Iran committing to a moratorium on nuclear enrichment, the US lifting sanctions against Iran and both countries withdrawing from restrictions on shipping through the Strait of Hormuz.
Many of the conditions are reportedly subject to a final agreement being reached between the delegations of the two countries.
A ceasefire has been in place between the United States and Iran since April 7 to allow for negotiations, but an end to hostilities often appears fragile.
Earlier this week, Iran launched a new attack on the UAE, attacking U.S. forces assisting commercial ships transiting the Strait of Hormuz. Meanwhile, the United States announced that it had sunk six small Iranian boats that tried to intercept commercial ships navigating the waterway.
But optimism about an end to the conflict resurfaced on Tuesday, a day after President Trump began assessing whether a peace deal could be reached, saying he was suspending Project Freedom, a U.S. military operation aimed at diverting ships from the Strait of Hormuz.
President Trump said in a post on Truth Social that “significant progress has been made toward a full and final agreement” with Iran.
—CNBC’s Kevin Breuninger contributed to this report.
