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Middle East crisis live: Trump repeats Nato criticism and claims Iran has asked for a ceasefire | US-Israel war on Iran
What should we infer from Trump’s claim Iran has asked for ceasefire?
Peter Beaumont
President Trump’s Truth Social post claiming that Iran’s new president had asked for a ceasefire is problematic in a number of key details.
While Iran might have a new Supreme Leader in Mojtaba Khamenei, who succeeded his father Ali who was assassinated in the opening salvoes of the war, it does not have a “new president” who remains exactly the same person as before the start of the war – Masoud Pezeshkian.
If, at a pinch one could argue that, Trump is talking sloppily about the president of a “new regime” that still remains sharply at odds with most expert analysis which suggests that far from being “less radicalized” the regime has taken a more hardline and unpredictable turn since Ali Khamenei’s killing as the Islamic Revolutionary Guards Corps has moved to further consolidate its power.
Even in the event that Pezeshkian is behind an undisclosed ceasefire initiative of some kind – which Iran has not commented on – it is not clear what the status that might means in terms of Tehran’s internal power dynamics where the role of Supreme Leader is viewed historically as being more powerful than the office of president.
In a phone call this week with Antonio Costa, president of the European Council, Pezeshkian suggested that Iran could end of the conflict but with the important proviso of guarantees against a repeat attack – which is one of Tehran’s key demands and which Trump may be misrepresenting.
“We possess the necessary will to end this conflict, provided that essential conditions are met, especially the guarantees required to prevent repetition of the aggression,” Pezeshkian’s office said in a statement.
When Iran has commented on contacts through the mediation of Pakistan it has been to suggest that Trump’s remarks on progress have been highly exaggerated, a familiar Trump trait both in his interventions in Middle East diplomacy and over the war in Ukraine where repeated claims of imminent breakthroughs have tended not to survive contact with reality.
Amid widespread reporting that Trump is looking for an exit strategy for a deeply unpopular war that he has already become bored with, what seems more likely is that he is trying to shape a narrative that would allow him to say the war has been won.
Key events
Trump repeats claims of Iran ‘regime change’
Reuters has published further remarks from Donald Trump in its phone interview with the US president.
When asked if he was thinking about pulling the US out of Nato, he said: “Oh, absolutely without question. Wouldn’t you do that if you were me?”
He added: “They haven’t been friends when we needed them. We’ve never asked them for much … it’s a one-way street.”
He also expressed his hope for a deal with the new leaders in Iran after airstrikes killed supreme leader Ali Khamenei.
He again claimed that there has been a “full regime change” in Iran, adding: “I’m dealing with a very good chance that we’ll make a deal because they don’t want to be blasted anymore.
“I didn’t need regime change, but we got it because of the casualties of war. We got it. So we have regime change and the big thing we have is they’re not going to have a nuclear weapon. Nor do they want one.”
As for the enriched uranium still possessed by Iran, Trump said: “That’s so far underground, I don’t care about that.
“We’ll always be watching it by satellite.”
Iran’s Islamic Revolutionary Guard Corps (IRGC) has acknowledged the attack on an oil tanker in Qatari waters, alleging that it had ties to Israel.
As reported earlier, the Qatari defence ministry said the Aqua 1 fuel oil tanker leased to the state-owned QatarEnergy was hit by an Iranian cruise missile. There were no reports of injuries and the 21 crew members escaped unharmed.
In a statement carried by Iranian state media, the IRGC said an oil tanker belonging to the “Zionist regime with the trade name ’Aqua 1’” in the the Persian Gulf “was precisely targeted”.
It was not immediately clear what links the oil tanker have to Israel.
In further news alerts, Reuters reported Trump as saying Iran will not have a nuclear weapon “nor do they want one”.
Iran has long maintained that its nuclear programme is for peaceful purposes, with leaders citing a religious decree (known as a fatwa) against weapons of mass destruction. The US and Israel have always disputed this claim.
Trump says US will be ‘out of Iran pretty quickly’ – Reuters
In an interview with Reuters news agency, Donald Trump said the US will be “out of Iran pretty quickly” but could return for “spot hits”.
Ahead of his scheduled national address this evening, the US president said he would express his disgust with Nato over what he described as its lack of support for his war objectives against Iran. He added that he was “absolutely” considering an attempt to withdraw the US from the alliance, according to Reuters.
He did not give a timeline of when the US could end the war, saying: “I can’t tell you exactly… we’re going to be out pretty quickly.”
He added: “They [Iran] won’t have a nuclear weapon because they are incapable of that now, and then I’ll leave, and I’ll take everybody with me, and if we have to we’ll come back to do spot hits.”
Dan Sabbagh
British counter drone crews in northern Iraq downed over 10 Iranian drones overnight, the UK Ministry of Defence said.
Attacks have continued seemingly undimmed over the past month, with some or more aimed at western bases, previously for troops engaged in counter Islamic State operations before the US and Israel attacked Iran.
It was not clear what Donald Trump meant by “Iran’s new regime president”, as there has been no recent change in that role. Masoud Pezeshkian remains the Iranian president, a role he has served since 2024.
Trump claims Iran’s president has asked US for a ceasefire
The US would only consider a ceasefire with Iran if the Hormuz strait opens, Donald Trump has declared on social media.
He said Iran had asked for a ceasefire, writing:
Iran’s New Regime President, much less Radicalized and far more intelligent than his predecessors, has just asked the United States of America for a CEASEFIRE! We will consider when Hormuz Strait is open, free, and clear. Until then, we are blasting Iran into oblivion or, as they say, back to the Stone Ages!!! President DJT
Explosions were heard in the Syrian capital Damascus and its surrounding areas, state TV al Ekhbariyah reported on Wednesday.
The network said that that the blasts were likely caused by Israeli air defences intercepting Iranian missiles.
Iranian authorities warned Nato member Bulgaria last month not to let the US use its airports for planes participating in military operations in Iran, the foreign ministry said on Wednesday.
Earlier on Wednesday, Stanislav Balabanov, a deputy with the ‘There is Such People’ party, showed a note from 18 March in which the Iranian government protested against US military refuelling planes parked at Bulgaria’s Vasil Levski airport.
In the note, Iran said it “reserves the right to take all necessary measures to protect its sovereignty, security and national interests in accordance with international law.” Later on Wednesday, in a statement to reporters, deputy foreign minister Marin Raikov confirmed the note and said: “Bulgaria is not at war.“
“No combat aircraft are being loaded over Bulgaria to participate in military operations,” he told reporters. “We maintain intact diplomatic relations with the Iranian side.“
The new supreme leader of Iran, Mojtaba Khamenei, has issued a message of gratitude to Hezbollah’s secretary general, Naim Qassem.
In a statement carried by Iranian media, he praised Hezbollah for its “perseverance, steadfastness and patience” against “the most ruthless enemies of the Islamic world”, as he vowed Iran will continue to support groups fighting US and Israeli forces across the Middle East.
Khamenei has not been seen since the war began on 28 February and has only issued written statements since becoming Iran’s new supreme leader. US and Israeli officials believe he was wounded in the attack that killed six of his family members, including his father, Ayatollah Ali Khamenei, and remains in hiding.
Here are some of the latest images from across the Middle East:
The Israeli military claimed to have killed a Hezbollah commander who was responsible for the group’s military activity in southern Lebanon.
In a statement on social media, the Israel Defense Forces (IDF) said Yusuf Ismail Hashem was killed in a strike in Beirut yesterday. It described Hashem as a “senior commander with 40+ years of experience” and that he was “a central figure in Hezbollah”.
There was no immediate comment from Hezbollah on the reported killing.
The IDF has escalated its attacks in southern Lebanon as Hezbollah continues to fight an Israeli ground invasion. Israel said it will occupy swathes of southern Lebanon and destroy the homes along the border to prevent the return of about 600,000 people, prompting concerns of long-term forced displacement.
The Israeli defence minister, Israel Katz, said that when fighting with Hezbollah ended, Israel would occupy the area under the Litani River, about 19 miles from the Israel-Lebanon border, as part of its so-called buffer zone inside southern Lebanon.
Ebrahim Azizi, the chair of the Iranian parliament’s national security commission, has mocked Donald Trump for declaring “regime change” in Iran, saying the only change the US has achieved in the war is losing access to the strait of Hormuz.
In a post on X, he said:
Trump has finally achieved his dream of ‘regime change’—but in the region’s maritime regime!
The strait of Hormuz will certainly reopen, but not for you; it will be open for those who comply with the new laws of Iran.
Taz Ali
Donald Trump said he will wrap up his military campaign against Iran in two to three weeks and that a deal is not necessary to end the conflict.
“We will be leaving very soon,” he told reporters in the Oval Office last night.
The White House said the US president will provide “an important update” during a national address this evening at 9pm Washington time (2am BST). While it is unclear what updates he will provide on the war, questions remain over whether the US has achieved its shifting objectives since launching a joint attack with Israel against Iran more than four weeks ago.
Trump said on Monday that he has already achieved regime change by killing Iran’s supreme leader Ayatollah Ali Khamenei, even though he has been replaced by his son, Mojtaba. Other key Iranian officials have been killed since the outbreak of the war, but critics say a change in Iran’s leadership does not constitute a regime change.
“What we are seeing in Iran is not a regime change — but a transformation within the regime itself, one that has made it more extreme,” Danny Citrinowicz, the Israeli military’s former top Iran researcher, posted on X.
Starmer says summit with EU later this year will lead to ‘more ambitious’ plans for cooperation
Andrew Sparrow
Keir Starmer said he will push for a closer relationship with the EU at a summit coming up later this year.
“We want to be more ambitious, closer economic cooperation, closer security cooperation, a partnership that recognises our shared values, our shared interest and our shared future,” he said in a press conference in Downing Street.
When asked by a reporter whether a closer relationship with the EU is an acknowledgment that the relationship with the US is changing, Starmer responded:
Firstly, Nato is the single most effective military alliance the world has ever seen. And it has kept us safe for many decades. And we are fully committed to Nato.
Secondly, that, whatever the pressure on me and others, whatever the noise, I’m going to act in the British national interest in all the decisions that I make.
And that’s why I’ve been absolutely clear that this is not our war, and we’re not going to get dragged into it.
But I’m equally clear that, when it comes to defence and security and our economic future, we have to have closer ties with Europe.
His remarks followed a Telegraph interview with Donald Trump, in which the US president said he was considering pulling the US out of Nato, and suggested the UK does not have a proper navy.
Trump’s frustration with Nato over its refusal to back his Iran war is clear – snap analysis
Jakub Krupa
Trump’s latest comments come as he increasingly hardens his language against European allies, blaming them for difficulties in his Iran operation.
In last days, he specifically targeted European allies, calling them “cowards” and telling them to “build up some delayed courage” and take control over the strait of Hormuz.
He and his senior officials also criticised a number of specific countries, particularly Spain, which has been most vocally critical of the US-Israeli war against Iran, and France.
The US secretary of state, Marco Rubio, warned last night about the sharply escalating frustration with Nato, as he told Fox News: “We are going to have to reexamine whether or not this alliance that has served this country well for a while is still serving that purpose or has now become a one-way street, where America is simply in a position to help Europe but when we need the help of our allies, they deny us basing rights and overflight.”
Italy is the latest country to risk the US administration’s anger, after it has denied the use of an airbase in Sicily to US military planes carrying weapons for the war in Iran after the US did not follow the required authorisation procedure.
For more on the impact of the war in Europe, follow our Europe live blog here:
Keir Starmer is giving an update on the Iran war at a press conference in Downing Street, where he sought to reassure the British public that the government is working on a plan to help with the cost of living.
“We will continue to stand up for the British national interest, and we continue to do what we must to guide our country calmly through this storm,” he said.
You can follow the live updates on our UK politics blog here:
The man said his home has been targeted three times in the last five months.
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European stock markets hit record high and oil price falls to three-month low after US-Iran peace deal – business live | Business
European stock markets hit record high
European stock markets have hit a record high at the start of trading, as relief over the US-Iran peace deal ripples across global markets.
The pan-European Stoxx 600 index has jumped by 0.9% to 639 points, over the previous record high set just before the Iran war started, with shares rising in London, Frankfurt, Paris, Madrid and Milan.
Mining and travel companies are driving the rally, while oil company shares are sliding.
That follows sharp gains in Asia-Pacific markets overnight, where Japan’s Nikkei surged by 5% on hopes that the strait of Hormuz will reopen within days.
Matt Britzman, senior equity analyst at Hargreaves Lansdown, says global equity markets are starting the week firmly on the front foot after President Trump announced that a deal with Iran had been reached, adding:
The move has given investors a clear reason to dial back some of the geopolitical risk premium that has hung over markets, especially as the Strait of Hormuz is expected to reopen and oil prices move sharply lower.
Energy prices have been one of the clearest transmission channels from Middle East tensions into inflation, bond yields and equity sentiment, and there is likely to be a concerted effort to get prices down even further once this deal is finalised.
There are still details to be ironed out before markets can fully trust the agreement, but for now the direction of travel is clear: lower oil, calmer nerves and a renewed appetite for risk.
Key events
Peace deal should keep mortgage rates down
Mortgage borrowers can breathe a sigh of relief at the news of a peace deal in Iran, says Adam French, head of consumer finance at Moneyfactscompare.co.uk.
While we are far from being out of the woods yet, a lasting peace deal should dramatically reduce the risk of the Bank of England’s worst-case scenario for inflation and interest rates becoming a reality.
“Under that scenario, Base Rate could have risen to 5.25%, potentially pushing typical rates on new mortgages towards 6.75%. Instead, today’s news means mortgages rates, which have already been slowly falling for several weeks, have likely already passed their peak – at least until the next unwelcome crisis.
“Borrowers can be optimistic but with a word of caution, as inflation and economic data will continue to influence the outlook. However, a lasting peace should remove one of the biggest risks to mortgage costs and may help restore a more stable environment for hard-pressed remortgage borrowers and prospective buyers.”
Even before this morning’s drop in UK bond yields (see earlier post), average mortgage rates have dipped slightly.
Moneyfacts reports:
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The average 2-year fixed residential mortgage rate today is 5.61%. This is down from 5.62% the previous working day.
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The average 5-year fixed residential mortgage rate today is 5.58%. This is down from 5.59% the previous working day.
Why it may take months for oil flows to return to normal
Donald Trump excitedly declared: “Ships of the World, start your engines. Let the oil flow!” last night, but the reality is that it will take some time for oil flows through the strait of Hormuz to return to pre-war levels.
One reason is that many oil tankers are simply in the wrong place, after the long closure of the strait.
Another is that some production and refining facilities have been damaged by the conflict, while others were mothballed after storate facilities filled up to the brim.
A third factor is that insurers could still be wary of the conflict reigniting, and price their cover accordingly.
Neil Shearing, group chief economist at Capital Economics, explains:
Even if ships now have safe passage, tankers are in the wrong place, oil production/refining facilities need to get up to full capacity, and questions over the cost and availability of insurance for ships traversing the Strait will remain.
Our current working assumption is that ~80% of energy flows will resume by the end of Q3. Natural gas flows will be slower to return, following the damage to Qatari facilities earlier in the conflict, which according to local officials has put 17% of production offline for two to three years.
US crude drops below $80
US crude oil has dropped to its lowest level since the second week of the Iran war.
The cost of a barrel of West Texas Intermediate (WTI) light sweet crude has dropped by 6% today to $79.72 per barrel, the first time since 10 March that it has been under $80/barrel.
That could help to pull down US gasoline prices, which climbed after the conflict began, hitting consumer confidence.
UK bond yields fall
Today’s relief rally is also driving up government bond prices, pushing down the cost of borrowing.
The yield (or interest rate) on 10-year UK government debt has dropped by 6.5 basis points (0.065 of a percentage point) to 4.775%.
Two-year bond yields are down 8bps to 4.16%.
Lower bond yields indicate that that the cost of issuing new government debt has fallen, which will be a relief for the UK Treasury after the Iran war drove up borrowing costs.
Copper mining company Antofagasta is now the top riser on the FTSE 100, up almost 8%.
Trader will be concluding that an end to the Iran war will boost the world economy, leading to more demand for raw materials such as copper.
European stock markets hit record high
European stock markets have hit a record high at the start of trading, as relief over the US-Iran peace deal ripples across global markets.
The pan-European Stoxx 600 index has jumped by 0.9% to 639 points, over the previous record high set just before the Iran war started, with shares rising in London, Frankfurt, Paris, Madrid and Milan.
Mining and travel companies are driving the rally, while oil company shares are sliding.
That follows sharp gains in Asia-Pacific markets overnight, where Japan’s Nikkei surged by 5% on hopes that the strait of Hormuz will reopen within days.
Matt Britzman, senior equity analyst at Hargreaves Lansdown, says global equity markets are starting the week firmly on the front foot after President Trump announced that a deal with Iran had been reached, adding:
The move has given investors a clear reason to dial back some of the geopolitical risk premium that has hung over markets, especially as the Strait of Hormuz is expected to reopen and oil prices move sharply lower.
Energy prices have been one of the clearest transmission channels from Middle East tensions into inflation, bond yields and equity sentiment, and there is likely to be a concerted effort to get prices down even further once this deal is finalised.
There are still details to be ironed out before markets can fully trust the agreement, but for now the direction of travel is clear: lower oil, calmer nerves and a renewed appetite for risk.
BP and Shell’s shares slide
Shares in oil companies are falling, though – BP and Shell are both down 3.7%, as investors anticipate an end to their earnngs boost from the Iran war.
FTSE 100 index hits eight-week high
Boom! Britain’s stock market has hit a near-two month high at the start of trading, as investors welcome the breakthrough between the US and Iran to end the Middle East conflict.
The FTSE 100 blue-chip share index has jumped by 99 points, or almost 1%, at the start of trading to 10,570 points, its highest level since 21 April.
Engineering firm Rolls-Royce, which makes and services jet engines, is the top riser on the FTSE 100, up 5.5%, followed by British Airways parent company IAG, up 4.8%.
UK house prices dip in June
Gwyn Topham
Two bits of good news for Britons who don’t own their homes have been revealed, with data showing a drop in house prices in June as well as fewer tenants facing rent hikes last month.
Figures from Rightmove showed the average price of property coming on the to market fell by 0.6% or £2,113 to £376,191, the biggest June fall in fourteen years, with prices 0.5% below this time in 2025. The biggest drops were seen in southern England and Wales, and in asking prices for flats rather than houses.
The property site said the number of homes for sale was still at historically high levels for summer, making it more of a buyer’s market. Mortgage affordability has also improved slightly this month, with the average two-year fixed rate deal dropping about 0.1 percentage points to 5.07%, it said.
Meanwhile, figures suggest that the introduction of the Renters Right Act may already be seeing results in terms of keeping rents down for tenants.
The new law came into force at the start of May and means landlords can only increase rents for sitting tenants once a year. According to Hamptons monthly lettings index, the number of tenants who saw their rent rise was down 23% from the same month last year. Hamptons said if the rest of the year saw similar change, it would expect only 31% of sitting tenants to face increases, compared to 40%-50% in previous years.
However, the agency warned that rent rises in Scotland, where landlords have been operating under a similar system for longer, exceeded the national average. Sitting tenants who faced rent rises had an average increase of 5.4% in May, but the figure reached 7.7% in Scotland, albeit for a lower absolute rent – £952 – than the Great Britain average of £1375.
Speaking of the ECB, their president Christine Lagarde has been warning that inflation pressures are spreading in the euro area.
In an intervew with broadcaster France Culture, Lagarde warned that high energy prices are starting to feed through to other parts of the economy, saying:
“Indirect effects of inflation, we have absolutely started to see that more or less everywhere in recent weeks.”
The US-Iran agreement is well-timed for the Bank of England, which is due to set UK interest rates on Thursday.
If the strait of Hormuz does reopen, and oil flows return towards pre-war levels, there will be less inflationary pressure – and thus less need for interest rate rises.
The European Central Bank raised its interest rates last week, but this week is the turn of the BoE, the US Federal Reserve and the Bank of Japan.
Kathleen Brooks, research director at XTB, says:
Over the past month, the price of oil is down by more than a fifth, and the Brent crude price is now back at levels from early March. This is good news for inflation, which should start tumbling monthly from June, and it could ease concerns about price pressures as we lead up to some major central bank action this week. The decline in the oil price also raises questions about whether the ECB was too hasty in raising rates last week.
European stock markets are on track to jump when trading begins, in just over 20 minutes.
Germany’s DAX share index is up 1.65% in the futures market, Reuters reports, with the UK’s FTSE 100 0.75% higher.
The US dollar is weakening, as investors shift into riskier currencies.
The pound is its highest in over a week, at $1.3438.
Markets rally across Asia
There are strong gains across Asia-Pacific markets today, as investors welcome the deal between the US and Iran.
Japan’s Nikkei share index has leapt by 5%, as has South Korea’s KOSPI, while China’s CSI300 index is 1.9% higher.
Jim Reid, market strategist at Deutsche Bank, says:
Whilst the deal is very good news for markets it looks like tough conversations will have occur in the 60-day window to ensure the peace is sustainable. As an example, the Senate needs to approve any extensive sanction relief for Iran.
For now the can kicking exercise has been very well received by markets even after a strong US close on Friday where hopes were raised of a weekend signing
Introduction: Oil falls to three-month low
Good morning, and welcome to our rolling coverage of business, the financial markets, and the world economy.
The peace deal agreed between Iran and the US is sending a wave of relief through the markets today.
Oil has tumbled 4%, and markets across the Asia-Pacific region have jumped, as investors anticipate the reopening of the strait of Hormuz.
Although it is unclear exactly what has been agreed – with the final text of their memorandum of understanding unpublished – Donald Trump’s claim that “oil will flow on both ends again for the region, and the world” is pushing down energy prices – a relief for busineses, consumers, politicians and central bankers alike.
Brent crude has fallen as low as $83.04, its lowest since 10 March, after the prime minister of Pakistan announced the US and Iran will sign a memorandum of understanding in Switzerland on Friday.
That still leaves Brent above its pre-war price of $72.48 a barrel, though.
Trump has indicated that the opening of the strait is contingent upon the signing of the peace deal, scheduled for Friday.
Iran’s Mehr state news, though, reported that the agreed memorandum of understanding calls for the reopening of the strait within 30 days under “Iranian arrangements” – an indication that Tehran hasn’t surrendered its control of the waterway.
Chris Weston of IG points out that there are still obstacles to overcome:
The probable reopening of the Strait of Hormuz later this week would represent a significant positive development. Markets had increasingly questioned how long inventory draws could offset supply disruptions and whether physical dislocations would begin weighing more heavily on risk assets. The focus now shifts towards understanding what normalisation of logistics could realistically look like, and how quickly shipping volumes can return to pre-conflict levels of 120 to 140 commercial vessels transiting eastbound and westbound each day.
There are still obstacles to overcome. Mines may need to be cleared, and there may be structural damage to refineries and export facilities around the region that will take time to repair and come back to pre-conflict capacity.
The agenda
Paying tribute, Sir Keir Starmer said Lord Hattersley “was a giant of the Labour movement”.
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