President Donald Trump rejected Iran’s latest proposal, with a senior U.S. official confirming to Reuters that Trump turned down an Iranian framework seeking to separate ending hostilities from nuclear issues. The naval blockade on the Strait of Hormuz is pushing Iran’s economy to a strategic breaking point. Oil wells are now being shut down due to lack of storage space—a situation that puts the regime on a countdown to default on payments to civil servants and security forces.
In a meeting Trump held with his advisers last night, the administration made clear the U.S. will not agree to any framework that doesn’t address the nuclear program from the opening stages. Iran’s proposal, delivered by Foreign Minister Abbas Araghchi, outlined phased talks: first ending the war and lifting the blockade, with nuclear discussions only at the end of the process.
A White House spokesperson said, “The United States will not negotiate through the press. We have been very clear about our red lines. The administration is working to end the war against Iran, which began last February in cooperation with Israel.”
The U.S. hardline stance on negotiations led to the cancellation of planned visits by Special Envoy Steve Witkoff and Jared Kushner to Islamabad. Araghchi, who received backing from President Putin in Moscow, told reporters: “Trump requested negotiations because the U.S. has not achieved any of its objectives.”
U.S. Treasury Secretary Scott Bessent revealed a critical development: the naval blockade is preventing oil exports and has led to complete filling of Iran’s storage tanks. Iran is now forced to shut down pumping at some of its wells.
According to Bessent, Iran has begun shutting down pumping at some of its oil wells as a result of the Hormuz blockade. The blockade prevents oil exports, storage tanks are filling up, and there’s nowhere to store new oil. Without continued pumping, long-term damage will be caused to the wells, beyond the immediate loss of revenue.
Senior energy officials in Tehran, however, denied reports of infrastructure collapse and claimed it’s “psychological warfare.” Mehdi Hosseini, a senior Iranian energy expert, said: “The claims about shutting down wells are pure American propaganda. Our oil experts will not allow the wells to close. Output will be reduced according to storage capacity, but we will keep the wells ‘alive’ so they can be returned to full operation. Iran will not surrender to a complete halt of production.”
Meanwhile, ship tracking data from Kpler and SynMax shows that in the past, about 140 ships passed through the Strait of Hormuz daily. In the last 24 hours, only seven ships passed through. None of them carried oil to the global market. At least six tankers loaded with Iranian oil were forced to return to Iran by the American blockade in recent days. Tehran called this “legalization of piracy.” In response to these moves, oil prices began climbing again on Asian exchanges due to fears of a complete supply cutoff.
At this stage, it appears Iran is just weeks away from internal financial collapse. Without oil revenues, the regime will struggle to pay salaries to civil servants and subsequently to Revolutionary Guard personnel. Forced shutdown of oil wells is a significant move: beyond the loss of money, physical damage is caused to reservoirs whose rehabilitation requires years.