Hostilities escalated in the Gulf on 4 May, sorely testing a four-week-old ceasefire. The spike in violence came a day after U.S. President Donald Trump offered that the U.S. would “guide” ships through the Strait of Hormuz – apparently seeking to break the chokehold Iran has placed on the waterway since the U.S. and Israel attacked the Islamic Republic on 28 February. According to reports, Iranian strikes hit key oil and gas facilities in the Emirati port of Fujairah; a residential area in Oman; and South Korean and Emirati tankers, injuring civilians in the UAE and Oman and further rattling global energy markets. Iran also reportedly fired at U.S. naval vessels. From Washington, Trump claimed that the U.S. had struck seven Iranian “fast boats” in its effort to provide stranded ships safe passage. 

The flare-up comes as U.S.-Iran talks, mediated by Pakistan, remain stalled. Through Pakistan, Iran advanced a proposed phased framework that would end the war and the maritime standoff – and only then address Tehran’s nuclear program. President Trump rejected that logic while leaving open the possibility of renewed strikes. Even so, indirect diplomacy did not stop, as the two sides exchanged messages and reviewed proposals. The overall equation remains unstable because the Strait of Hormuz is still, in effect, both a pressure point and a bargaining chip, putting the ceasefire’s staying power in question. 

Shipping is not in total paralysis. For example, in late April Reuters tracking showed a crude tanker and a liquefied natural gas cargo ship that departed from Abu Dhabi had transited the strait, the latter being the first vessel loaded with LNG to do so since the war began. On 4 May, the U.S. military said several of its ships had sailed through the strait, adding that two U.S.-flagged merchant vessels had exited the Gulf. But those exceptions only underscore how abnormal the wider pattern remains. The U.S. military claimed on 4 May to have stopped 50 commercial vessels under its blockade of Iranian ports, while a bulk carrier steaming off the Iranian town of Sirik reported an attack by multiple small craft. Energy markets have treated that mix of selective passage and persistent coercion as indicators that the disruption will persist. At the same time, the UAE’s decision to leave OPEC, the Organization of Arab Petroleum Exporting Countries and OPEC+ (consisting of OPEC’s twelve members plus several other big producers, notably Russia) served as evidence that Gulf energy politics are fragmenting under the weight of diverging approaches to the crisis and constrained exports.

The other active front was in Lebanon, where both Hizbollah and Israel maintained military pressure. Despite the ceasefire extension agreed upon on 23 April, Israeli forces kept up strikes and issued new evacuation orders to towns beyond the buffer zone they have carved out in the Lebanese south, while Hizbollah continued drone and rocket attacks on Israeli troops in Lebanon and northern Israel. The result was not a return to full-scale fighting at the tempo of March and early April, but Israeli strikes have nonetheless killed well over 100 people in Lebanon under the truce; Hizbollah’s attacks have claimed the lives of at least sixteen Israeli soldiers since late February. Escalation on this front, too, remains possible, which could complicate matters between Iran and the U.S. insofar as Tehran still insists on folding Lebanon into any settlement. Thus, while the Lebanese front is not the primary driver of developments, it could limit how far diplomatic movement elsewhere could go.

Iran’s strategy reflects its belief that its most effective remaining leverage lies in its continued control of the Strait of Hormuz. Foreign Minister Abbas Araghchi and other Iranian officials have been trying to convert that leverage into a phased political bargain. The fourteen-point framework (as described in Iranian and international media) seeks sanctions relief, an end to the U.S. naval blockade, withdrawal of U.S. forces from Iran’s maritime periphery and a full cessation of hostilities on all fronts, including Lebanon, while pushing nuclear negotiations back to a later stage. Some of the details of the nuclear proposal, as reported, may be seen as signs of moderation (notably the suggestion of a fifteen-year freeze on uranium enrichment, which Iran’s foreign ministry subsequently denied) but overall the document evinces Iran’s view that the imposition of global costs (restricted shipping and energy disruption) will allow it to end the war without having to make concessions on its nuclear program. Strategists in Tehran clearly think that resolving the Hormuz crisis and naval blockade is more immediately attainable than addressing the nuclear issue. 

Iranian public messaging has reinforced the same perspective. Supreme Leader Mojtaba Khamenei hinted at developing a new legal framework for the Strait of Hormuz, while Iranian official media insist that no nuclear negotiations are under way at this stage. Taken literally, those statements overstate Iran’s ability to impose a post-war maritime order on its own. Taken strategically, they are meant to implant the idea that passage through the strait will not simply revert to pre-war practices, and certainly not on Washington’s timetable, and that any maritime reopening must be tied to recognition that henceforth Iran will exercise a degree of control of the strait regardless of traditional freedom of navigation norms and an end to naval pressure.

Yet Tehran’s room for manoeuvre is narrower than its rhetoric suggests. The Iranian rial/toman has fallen sharply in value over the last week, as the blockade constrains hard currency. It has dropped to record lows of around 1.81 million to 1.9 million per U.S. dollar on the open market (from around 1 million prior to the war). Moreover, each additional incident endangering commercial traffic increases the risk that Iran’s maritime pressure will generate not accommodation but a broader coalition arrayed against it. Thus, Tehran is pairing maximalist language with a practical search for mediated off-ramps. Meanwhile, reported 4 May attempts to strike U.S. forces, commercial ships and the UAE underscore the volatility of a nominal ceasefire against the backdrop of heightened U.S. efforts to ramp up maritime traffic while suppressing Iran’s own commerce. 

Washington’s behaviour suggests that it is trying to reshape the confrontation rather than merely freeze it, in hopes that its play to undercut Tehran’s control of the Strait of Hormuz combined with economic pressures will force Iran’s hand. Despite the economic fallout from the war, which continues to feed domestic discontent, including through higher gas prices, Trump has sought to project patience (even as reporting suggests that he feels nothing of the sort) and a refusal to defer negotiations over nuclear issues in exchange for a reciprocal reopening of the strait. His attitude was encapsulated in the wording of his rejection of Iran’s proposal, when he noted that Iran had not yet “paid enough”. 

Politically, according to a prominent poll, disapproval of Trump stands at 62 per cent, the high-water mark for his two terms in office. Similarly, 66 per cent of those surveyed disapprove of his handling of the war. The impact of the war on U.S. military preparedness, with stockpiles of key weaponry being depleted at an accelerated rate, has also prompted wide-ranging concerns about long-term consequences, particularly if fighting resumes in full. Trump himself has kept that prospect alive with repeated threats to ramp up hostilities once again. 

The politics in the United States regarding the war are also shaped by U.S. legal restrictions, particularly the 1973 War Powers Resolution, which imposes a 60-day time limit on hostilities not authorised by Congress. In seeking to circumvent that limit, the White House announced on 1 May that hostilities had “terminated” with the ceasefire, but lawmakers in Trump’s own Republican party are expressing increasing unease and impatience with the conflict. 

On 3 May, Trump announced Project Freedom – a new U.S. plan for the U.S. navy to assist commercial traffic transiting the Strait of Hormuz by offering advice on safe routing and standing by to offer military assistance in the event of Iranian reprisal. It is unclear how many commercial ships stranded due to the closure will be willing to take the risk of such an attempt or whether Iran would be ready to take military action against them. Trump’s announcement suggests both frustration with the status quo and reluctance to initiate a return to all-out war, but it also represents a further potential trigger for military conflict, as illustrated by Iran’s 4 May attacks. Trump noted Iran had taken “some shots” at vessels, and he warned that Iranian forces would be “blown off the face if the earth” if they attacked U.S. ships, but he has yet to formally consign the ceasefire to the ash heap. The contradiction is that a strategy built on public ambiguity can deter Iran only if Tehran believes Washington is prepared to act, and that same belief increases the chance of Iranian counteraction.

Washington’s coercive architecture itself has widened over the past week. The U.S. Treasury Department moved beyond sanctions on shipping to designate Iranian shadow banking and foreign exchange networks used to convert oil proceeds into more usable currencies, after having already sanctioned a major Chinese refinery and dozens of shipping firms and vessels linked to Iranian oil exports. In parallel, President Trump met energy executives to discuss ways to stabilise markets if the blockade lasts for months, and the administration bypassed congressional review to approve more than $8.6 billion in emergency military sales to Israel and Gulf Arab states. The practical implication is that the U.S. is preparing not for exit but for prolonged bargaining under enhanced pressure. 

Israel continues to push the boundaries of the ceasefire in Lebanon imposed by Trump, which has limited its freedom of action in assailing Hizbollah positions beyond the south of the country. The Israeli military continued strikes in southern Lebanon, issued new evacuation orders to towns outside the existing buffer zone and stationed soldiers inside a larger self-declared “security belt”. That posture likely reflects a strategic judgment that the northern front now offers Israel both leverage and insulation: leverage because it can complicate U.S.-Iran diplomacy by keeping an Iran-linked front active, and insulation because it can pursue its own war aims under cover of a broader confrontation with Tehran. 

Israel remains on high alert in the event of a return to high-tempo hostilities with Iran, preparing for a long-haul contest. On 3 May, it approved a major fighter aircraft procurement plan centred on additional F-35 and F-15IA squadrons, explicitly tying this step to lessons drawn from the war with Iran and the need to preserve air superiority over a demanding decade ahead. That decision suggests that Israeli planners are moving toward the assumption that the war will be a recurrent, multi-front campaign. If they are, Israel would be left partly aligned with Washington and partly at odds with it. Both want Iran constrained, but the U.S. is still testing whether coercion can yield a deal, while Israel is using the pause to prepare for a longer confrontation in which military advantage matters more than diplomacy.

At least until the 4 May escalation, Gulf Arab states continued to prefer diplomacy, but their tolerance for an Iranian-defined regional order has lowered further. Bahrain has moved toward a harder internal security posture, openly accusing Tehran of interference in its affairs and those of other Gulf states, as well as “heinous aggression”, prompting explicit backing from the Gulf Cooperation Council and individual member states. In so doing, Gulf governments are signalling that, after absorbing Iranian strikes earlier in the war, they will not accept a reopened Strait of Hormuz that is subject to unilateral Iranian rules, tolls or discretionary arrangements. The Gulf’s preferred outcome – for the most part – remains a negotiated one, but one that restores the status quo ante of freedom of navigation, not one that converts Iranian wartime coercion into a new baseline. 

At the same time, the Gulf is not moving as a single bloc. Saudi Arabia, Qatar and Oman are all trying to keep the ceasefire alive even as the UAE and Bahrain have adopted a much more assertive position against Iran. That said, the UAE’s exit from OPEC was the starkest, most public manifestation of longstanding underlying tensions and intra-Gulf competition over market share once oil flows recover, although the continuing maritime disruption make OPEC+ output increases largely theoretical for the time being. At the same time, Washington’s emergency military sales underline how heavily Gulf leaders still lean on U.S. systems when threat perceptions rise. In other words, Gulf capitals want de-escalation, but they are preparing for a longer contest in which Iran remains dangerous and U.S. protection remains indispensable despite its erratic nature. 

U.S. efforts to loosen Iran’s chokehold upon the Strait of Hormuz underscore the inherent volatility of a ceasefire that is increasingly being honoured in the breach. The next phase is likely to determine whether the war fully resumes or whether a deal may be reached in which the strait is reopened before the nuclear dispute is addressed. The latter sequence would ease immediate economic pressure on Tehran and the global economy while preserving Iran’s ability to negotiate the nuclear issue from a less vulnerable position. Washington is resisting because, like Iran, it sees maritime leverage (its blockade) as its strongest remaining instrument for extracting concessions on enrichment, stockpiles and verification without resort to major escalation. At the same time, the U.S. launch of Project Freedom and associated operations, and Iran’s subsequent targeting of U.S. forces and allies, underscore that each side’s one-upmanship can quickly trigger an escalation in hostilities. 

While Trump’s pending meeting with Chinese leader Xi Jinping in Beijing may make him less inclined to risk an escalation right now, the risk of one is high. U.S. strikes will become more likely if Iran intensifies its attacks on commercial shipping or other Gulf targets, or if Washington increases the use of military force to restart traffic through the strait. A different escalatory pathway might open if Israeli operations in Lebanon expand sharply, leading Tehran to decide whether to accept compartmentalisation of the two fronts or to reactivate broader regional pressure.

The indicators to watch are whether indirect diplomatic exchanges through Pakistan or Oman produce a phased formula rather than another stalemate; whether U.S. Central Command keeps reporting a rising number of turned-back vessels headed for Iranian ports; whether more reports arrive of U.S. strikes on Iranian vessels and Iranian strikes on U.S. and Gulf targets; whether the UAE retaliates against Iran; whether Gulf capitals publicly reject an Iranian role in post-war strait management; whether clashes on the Lebanon front get sharper; and, perhaps most important of all, what clues emerge about Trump’s own calculus as to whether he can sustain a version of the status quo or feels the need to resume all-out military conflict.