Can the Iran-US ceasefire produce a lasting deal?
The two-week ceasefire between Iran and the US, which began on 8 April, marks both a diplomatic opening and a test to determine whether a lasting agreement can end this destructive war.
US President Donald Trump, who launched the war alongside Israel, is now assessing whether Iran is prepared to unblock the Strait of Hormuz, restore oil flows, and ultimately reach an agreement that he can present as a face-saving victory.
A recent New York Times article offered a striking account of how the Israelis persuaded Trump to go to war with Iran, noting that Prime Minister Benjamin Netanyahu “outlined conditions they portrayed as pointing to near-certain victory: Iran’s ballistic missile program could be destroyed in a few weeks. The regime would be so weakened that it could not choke off the Strait of Hormuz, and the likelihood that Iran would land blows against U.S. interests in neighboring countries was assessed as minimal”.
The article went on to cite an assessment from Mossad “that street protests inside Iran would begin again and - with the impetus of the Israeli spy agency helping to foment riots and rebellion - an intense bombing campaign could foster the conditions for the Iranian opposition to overthrow the regime”.
Interestingly, six weeks into the war - after extensive bombing, and as Trump threatened Iran with the end of its civilisation if it did not surrender within hours on 7 April - the White House was simultaneously urging Pakistan to broker a ceasefire, according to the Financial Times.
In any case, the US bombing campaign, having failed to secure any clear strategic objective, stands as a striking illustration of scholar Robert Jervis’s theory about how wars begin through the miscalculations of leaders.
On the Iranian side, the insistence of Ayatollah Ali Khamenei - the former Iranian leader killed in the initial wave of strikes on 28 February - on uranium enrichment came at an extraordinary cost. According to Hossein Selahvarzi, the former head of Iran’s Chamber of Commerce, sanctions drained roughly $1.2 trillion from the economy between 2011 and 2022.
Enrichment proved ineffective as a deterrent, failed to generate electricity, and never culminated in a nuclear weapon.
Economic disruption
Iran’s economy has been severely battered by the war. A report from a website affiliated with Iran’s state broadcaster estimates that 70 percent of the country’s steel and petrochemical industries have been damaged. Iran ranks among the world’s top 10 steel producers, making the scale of disruption particularly significant.
These sectors sustain thousands of downstream industries; their disruption could affect millions of jobs. Another sector that has been hit hard is the digital economy, particularly due to the mass internet shutdown imposed soon after the war began.
Americans are also under pressure. Just before the ceasefire was announced, physical oil prices spiked to record levels, near $150 a barrel in some cases. Trump has oscillated between denial - claiming “we don’t need oil, we have all the oil we need for ourselves”, even as the US imports roughly six million barrels a day - and stark escalation, including demands that Iran open “the fuckin’ Strait” and warnings that Iran’s “civilisation will die”.
This might help explain Trump's escalating fury. In such an eventuality, the House could initiate impeachment proceedings
As oil prices have surged, the cost of gas in the US, which could be a decisive factor in upcoming elections, has risen by 35 percent since the war began. Politico reports growing Republican concerns over voter backlash tied to cost-of-living pressures, with one source close to the White House saying: “This war in Iran almost cements the fact that we lose the midterms in November - the Senate and House.”
This might help explain Trump’s escalating fury. In such an eventuality, the House could initiate impeachment proceedings, while a two-thirds majority vote in the Senate could remove the president from office. Democratic Party leaders and strategists are already openly weighing impeachment scenarios should they regain control of Congress.
The effects of this war could extend well beyond immediate economic pressures, accelerating inflation and forcing the Federal Reserve to keep interest rates higher for longer, which would raise borrowing costs across the board - from mortgages to credit cards - and in turn slow growth.
According to a Bloomberg analysis, the petrodollar system is under strain, as higher oil prices have pushed some importing countries to sell US Treasuries to raise cash dollars, while exporters are recycling fewer petrodollars into US assets.
Now, the nagging question is whether this two-week ceasefire can lead to a peace agreement and a permanent end to the war.
Netanyahu under pressure
One of the main obstacles is Israel. Almost immediately after the ceasefire announcement, Netanyahu said the pause would not mark the end of Israel’s campaign against Iran: “We are prepared to return to combat at any moment required. Our finger is on the trigger.”
Just hours later, Israel launched 100 strikes within 10 minutes in Lebanon, killing more than 300 people and injuring 1,100 others. The UN condemned the attacks as “appalling”.
Netanyahu is now under pressure on two fronts: firstly, sections of the Israeli media have portrayed him as losing the war and failing to achieve key objectives, particularly the collapse of the Iranian government. Secondly, as noted in Haaretz, the terms underpinning the ceasefire “could strengthen the current Iranian regime and limit Israel’s campaign against Hezbollah”.
When Iran threatened to keep Hormuz closed in retaliation for Israel’s attacks on Lebanon, which it considers to be a vital part of the ceasefire framework, Netanyahu - backed by Trump and Vice President JD Vance - insisted that the deal did not include Lebanon. Netanyahu can undoubtedly complicate prospects for de-escalation - and he knows it.
Pakistan has publicly stated that the ceasefire deal applies to Lebanon, with Prime Minister Shehbaz Sharif noting that Iran and the US, “along with their allies, have agreed to an immediate ceasefire everywhere including Lebanon and elsewhere”. According to a New York Times report, the White House was “directly involved” in shaping Sharif’s communications on the issue.
Trump was later reported as saying: “I spoke with Bibi and he’s going to low-key it. I just think we have to be sort of a little more low-key” - effectively translating diplomatic language into pressure to stop operations.
Trump is now the single most important factor in determining whether any durable peace is possible. Forcing Israel to halt its strikes on Lebanon is the key test. If the administration treats this lightly, there is little chance the ceasefire will hold.
Observers will be watching closely to see whether Trump can restrain Netanyahu as he pursues a settlement with Iran, while Vance urges good-faith negotiations. There is so much at stake for both sides that, despite a bumpy road ahead, a near-miraculous deal could still emerge.
The views expressed in this article belong to the author and do not necessarily reflect the editorial policy of Middle East Eye.
This article was sourced from Middle East Eye.
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