US and Iran still at odds on key issues but both sides report signs of progress

The U.S. and Iran stuck to opposing stances on Thursday over Tehran's uranium stockpile and controls on the Strait of Hormuz, although U.S. Secretary of State Marco Rubio said there had been "some good signs" in talks.

U.S. President Donald Trump said the U.S. will eventually recover Iran's stockpile of highly enriched uranium - which Washington believes is destined for a nuclear weapon though Tehran says it is intended purely for peaceful purposes.

"We will get it. We don't need it, we don't want it. We'll probably destroy it after we get it, but we're not going to let them have it," Trump told reporters at the White House.

Rubio told reporters a diplomatic solution would be unfeasible if Tehran implemented a tolling system in the Strait of Hormuz. But he added that there had been some progress in talks.

"There's some good signs," Rubio said. "I don't want to be overly optimistic ... So, let's see what happens over the next few days."

A senior Iranian source told Reuters on Thursday that no deal has been reached but that gaps have been narrowed, adding that Iran's uranium enrichment and Tehran's control over the Strait of Hormuz remain among the sticking points.

Oil prices whipsawed in a volatile trading session on Thursday, moving lower on uncertain prospects for a resolution of the war.

Two senior Iranian sources told Reuters before Trump's comments that Iran's Supreme Leader Ayatollah Mojtaba Khamenei has issued a directive that the uranium should not be sent abroad.

Trump also railed against Tehran's intentions to charge fees for use of the strait, where a fifth of the world's oil and natural gas transited before the war.

"We want it open, we want it free. We don't want tolls," he said. "It's an international waterway."

Trump has said he is ready to resume strikes on Iran, which the U.S. and ally Israel first launched in late February, if he does not get the "right answers" from Iran's leadership.

Iran's Revolutionary Guards have warned that renewed attacks would trigger retaliation beyond its region.

LITTLE PROGRESS IN TALKS

While talks to end the war have appeared to make little progress in the six weeks since a fragile ceasefire took effect, a main mediator, Pakistan's Army Chief Asim Munir, was possibly heading to Tehran for more talks on Thursday, three sources told Reuters.

"We're speaking to all the various groups in Iran to streamline communication and so things pick up pace," said one of the sources familiar with negotiations. "Trump's patience running thin is a concern, but we're working on the pace at which messages are relayed from each side."

Pakistani Interior Minister Syed Mohsin Naqvi on Wednesday made his second trip to Tehran this week, carrying a message from the United States, and held talks with Iranian President Masoud Pezeshkian, Foreign Minister Abbas Araqchi and his counterpart, Iran's semi‑official ISNA news agency reported.

The impasse has wreaked havoc on the global economy, chiefly due to the inflationary impact of high oil prices.

Trump faces domestic pressure ahead of November midterm elections, with his approval rating near its lowest since he returned to the White House last year.

Tehran submitted its latest offer to the U.S. this week.

Tehran's descriptions suggest it largely repeats terms Trump previously rejected, including demands for control of the Strait of Hormuz, compensation for war damage, lifting of sanctions, release of frozen assets and the withdrawal of U.S. troops.

Iran’s deputy foreign minister on Thursday restated Tehran's claims to sovereignty over the strait.

GLOBAL ENERGY SHOCK

The International Energy Agency says the conflict has produced the world's worst energy shock.

It warned on Thursday that the peak of summer fuel demand coupled with a lack of new Middle East supply means the market could enter the "red zone" in July and August.

Some ships are managing to transit the strait, but only a trickle compared with the 125-140 daily passages before the war.

Iran's IRNA news agency said 31 ships had passed in the last 24 hours in coordination with the Iranian navy.

Iran said it aimed to reopen the strait to friendly countries that abide by its terms that could potentially include fees.

"It would make a diplomatic deal unfeasible if they were to continue to pursue that. So it's a threat to the world if they were trying to do that, and it's completely illegal," Rubio said.

Trump and Israeli Prime Minister Benjamin Netanyahu said their war aims were to curb Iran's support for regional militias, dismantle its nuclear program, destroy its missile capabilities and make it easier for Iranians to topple their rulers.

But Iran has so far retained its stockpile of near-weapons-grade enriched uranium, and its ability to threaten neighbors with missiles, drones and proxy militias.

-Jacob Bogage and Parisa Hafezi/Reuters