The United States and Iran exchanged a new round of escalatory signals on Monday as President Donald Trump pulled back from threatened strikes against Iranian power infrastructure, extending his Strait of Hormuz deadline by five days and leaving open, for the first time since the war began, the possibility of a negotiated off-ramp though Tehran immediately dismissed the suggestion.
The announcement came as Israel launched what it called "a wide-scale wave of strikes" on infrastructure targets in Tehran, and Iran renewed attacks on Gulf energy facilities and US military bases across the region. The conflict has now entered its fourth week, with no ceasefire in sight and the head of the International Energy Agency warning the situation is worse than both energy crises of the 1970s combined.
How the war began?
The current conflict traces to February 28, 2026, when the United States and Israel launched surprise airstrikes across Iran, killing Supreme Leader Ali Khamenei and dozens of other senior officials. The strikes targeted Iran's leadership compound, nuclear facilities, ballistic missile programme, and military infrastructure.
The attack came just one day after Oman's Foreign Minister had described a diplomatic "breakthrough," saying Iran had agreed to halt uranium stockpiling and accept full IAEA verification. Talks were scheduled to resume on March 2. They never did.
Iran responded with waves of missiles and drone strikes against Israel, US military bases in the region, and Gulf Arab states that it accused of facilitating the campaign. The Strait of Hormuz, the narrow waterway through which approximately 20% of the world's oil transits, was effectively closed to international tanker traffic. The economic consequences were immediate and global.
On the energy front
The conflict has opened a parallel war over energy infrastructure that has sent shockwaves through markets on every continent.
Israel struck Iran's South Pars gas field, one of the world's largest natural gas reserves. Trump publicly complained to Israeli Prime Minister Netanyahu about the strike, saying the United States had not been informed in advance. A person briefed on the matter told NPR that the US and Israel are in fact coordinated on all targets. Netanyahu said Israel acted alone, then confirmed: "President Trump asked us to hold off on future attacks, and we're holding off."
Iran responded by striking Gulf energy sites. Kuwait's Mina Al-Ahmadi refinery, the country's largest, was hit by Iranian drones, igniting fires across several operational units. The United Arab Emirates reported Iranian missile fire that triggered air defence interceptions. Qatar's 77 million tonnes per annum LNG facility at Ras Laffan ceased production after military attacks on March 2.
Columbia University's Center on Global Energy Policy calculated that approximately 110 billion cubic metres of LNG exports per year, representing 19% of global LNG trade, have been disrupted since February 28. On an annualized basis, the analysts said, the shock exceeds the 2022 crisis triggered by Russia's cuts to European pipeline gas. The IEA's Fatih Birol stated the situation is "very severe" and warned, "No country will be immune to the effects of this crisis if it continues to go in this direction."
Trump's 5-day pause
On Monday, Trump announced on Truth Social that the United States would hold off on threatened strikes against Iranian power plants for five days, framing it as an extension of his deadline for Iran to reopen the Strait of Hormuz. Oil prices had surged ahead of the announcement and fell sharply after it.
Iranian state television declared that Trump had "backed down following Iran's firm warning." Fars and Tasnim news agencies framed the pause as a retreat driven by Iranian deterrence. Iran's IRGC had warned that any attack on its power infrastructure would trigger strikes on power plants supplying electricity to US bases throughout the region, as well as attacks on the economic and energy infrastructure of countries in which Americans hold stakes.
Trump said he held open the possibility of a resolution, though Iranian officials publicly denied any negotiations were underway. Since the start of the conflict, Iranian officials have said that back-channel messages from mediators have been received but that Iran would continue its military posture until a sufficient level of deterrence was achieved.
The wider toll
Iran's death toll in the war surpassed 1,500, according to its Ministry of Health. The Iranian Red Crescent Society reported that more than 6,600 civilian units had been targeted in US-Israeli strikes. The US military confirmed 13 fatalities from Iranian counter-strikes across the region. In Iraq, at least 61 people have been killed, mostly members of the Popular Mobilisation Forces.
The US Treasury also announced a temporary partial lifting of Iranian oil sanctions — applying to Iranian oil currently loaded on ships — lasting until April 19, 2026. Treasury Secretary Scott Bessent said the move was expected to add roughly 140 million barrels to global supply. The reversal marks a significant policy shift as the Trump administration attempts to suppress oil prices while maintaining military pressure.
Oman's foreign minister, who brokered the collapsed February talks, said the strikes had undermined "active and serious negotiations." The IAEA's director-general said Iran's nuclear material and some enrichment capacity likely survived the strikes and would remain after the conflict ends.
Trump said he has no plans to send ground forces into Iran. He also said he retains all options.
