Iran-US war latest: Tehran threatens to pull out of peace deal unless Trump releases $24bn of frozen assets

Iran has said it will only sign a peace agreement with the US if Washington releases $24 billion (£17.8 bn) in frozen Iranian assets.

Tehran’s top negotiator and parliament speaker Mohammad Bagher Ghalibaf warned that no agreement would be finalised until half the frozen assets, around $12bn, are transferred after a memorandum of understanding is announced.

The second half of the assets “should be transferred within 60 days” of signing the peace agreement, the semi-official Tasnim news agency reported on Tuesday.

Ghalibaf visited Qatar on MOnday for talks, which he said were "generally positive and contributed to progress in broader negotiations”.

US secretary of state Marco Rubio said this week that there was “strong alignment and agreement on what a preliminary draft should look like”. 

But he added that it is “going to take a couple days to settle on even down to the disagreements over a word, a sentence”.

The demands came as Iran accused the US had violated the fragile ceasefire arrangement after the US conducted what it called defensive strikes in southern Iran.

Elsewhere, seven children were among 31 killed in Lebanon in the heaviest wave of Israeli strikes since a ceasefire agreement was signed.

The key issues preventing the US and Iran from agreeing a peace deal

As negotiators continue to work on reaching a peace agreement, here are the key sticking points between Washington and Tehran:

Iran’s nuclear programme

Iran’s nuclear programme is the lingering issue that had troubled American negotiators in talks before the conflict erupted on 28 February.

Trump insisted this week that the US 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.

Israeli prime minister Benjamin Netanyahu has said he will not consider the war over until enriched uranium is removed from Iran, Tehran ends its support for proxy militias, and its ballistic missile capabilities are eliminated.

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

The Strait of Hormuz

The closure of the Strait through the war has created massive disruption to a vital channel of commerce that ordinarily carries a fifth of global oil and LNG. Iran has floated plans to continue charging some $2m for tankers post-war.

The UN Convention on the Law of the Sea says countries bordering straits cannot demand payment simply for permission to pass through.

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

It emerged on Thursday that Iran and Oman have reportedly held discussions on enforcing a permanent toll on the Strait of Hormuz, despite Donald Trump’s warnings.

A ceasefire for Lebanon

Iranian state media reported earlier this month that Tehran was insisting upon the need to end the war on all fronts, especially in Lebanon, where proxy group Hezbollah continues to clash with Israeli forces.

Fighting has continued in southern Lebanon between Israel and Hezbollah, despite a US-brokered ceasefire there announced on April 16.

Alex Croft27 May 2026 09:15

What are Abraham Accords? The Trump-backed deal explained

Donald Trump has said he asked Saudi Arabia, Qatar, Pakistan, Turkey, Egypt and Jordan to join the “Abraham Accords” as he tries ⁠to negotiate an agreement to end his war with Iran.

The US president has repeatedly said he wants to expand the accords, brokered by him during his first ‌term in the White House.

Trump said he spoke on Saturday to leaders of those countries, as well as the United Arab Emirates and Bahrain, which have already signed ⁠the accords, a set of agreements to normalise relations with Israel.

"I am mandatorily ​requesting ⁠that all countries immediately sign the Abraham Accords, and that, if Iran signs its agreement with me, as president of the United States of America, it would be an Honor to have them also be part of this unparalleled ⁠World Coalition," Trump wrote in a post on Truth Social.

The Abraham Accords were a series of diplomatic and commercial agreements forged with US influence between Israel and the United Arab Emirates, Bahrain, Sudan and Morocco in 2020.

Peter Smith & Dan Haygarth report:

What are Abraham Accords? The Trump-backed deal explained

Abraham, known as Ibrahim to Muslims, is often invoked by those seeking to bridge interfaith dividesAlex Croft27 May 2026 08:53

In pictures: Israel kills Hamas commander in attack on Gaza

Alex Croft27 May 2026 08:35

Israel says it killed Hamas military leader in Gaza strike

The Israeli military says it has killed Hamas’ newly-appointed armed commander Mohammad Odeh in a strike on Gaza

Odeh, the leader of the al-Qassam Brigades - Hamas’ military wing in Gaza - was appointed to succeed Izz al-Din al-Haddad last week after the latter was killed in a similar strike on May 15.

Israeli Prime Minister Benjamin Netanyahu said on Tuesday that Odeh had headed Hamas' intelligence division at the time of the October 7, 2023 cross-border attack into Israel and was appointed about a week ago to replace Izz al-Din al-Haddad.

Sources close to Hamas did not confirm Odeh's appointment as the new military chief but agreed he was seen as Haddad's possible successor, as the group's chief of military intelligence and possibly the last remaining living member of the armed wing's higher leadership council.

Alex Croft27 May 2026 07:55

Projectile from Lebanon lands in Israel, no injuries reported

A projectile launched from Lebanon fell in an open area in Israel, the military said on Wednesday morning.

Sirens sounded in several northern areas during the attack and no injuries were reported, it added in a statement.

Alex Croft27 May 2026 07:26

Oil prices remain high as markets eye Iran talks

Oil prices remained elevated today as markets looked for signals that a shaky truce between the United States and Iran will be extended.

Brent crude traded near $100 per barrel, and the dollar held gains from the previous session after Iran said the US had violated a ceasefire.

Japan's Nikkei share gauge jumped to a record level, following all-time highs on Wall Street on AI optimism as the US reopened after a holiday. Sentiment remains vulnerable, however, as talks continue to reach a lasting halt to the three-month-long conflict that has rocked energy markets, and central banker comments will be watched for how the crisis is impacting the picture for inflation and interest rates.

Stuti Mishra27 May 2026 07:01

UN Security Council condemns attack on UAE nuclear plant

The United Nations Security Council on Tuesday condemned the attack ⁠on Barakah Nuclear Plant in the United Arab Emirates, according to ⁠a statement, adding that ⁠the attack constituted a violation ⁠of international law.

The council did ⁠not attribute ‌blame for the attack.

The UAE said last ‌week that six ‌drones had been launched against it from ⁠Iraq, including one that caused a fire at the nuclear power plant in the Gulf state.

Iraq is ‌home to powerful Iranian-backed militia groups ‌which have ⁠claimed attacks against "enemy ⁠bases in Iraq and ‌the region" during ‌the US-Israeli war on Iran.

Stuti Mishra27 May 2026 06:07

Israel clashes with Hezbollah along Litani River as Netanyahu orders expanded Lebanon operations

Israeli troops have clashed with Hezbollah along the Litani River in southern Lebanon as Israel pushed farther north, a day after prime minister Benjamin Netanyahu ordered an expansion of military operations and one of the heaviest nights of strikes since a US-brokered ceasefire began in mid-April.

The Israeli military said it struck more than 100 Hezbollah sites across southern Lebanon and the eastern Bekaa Valley overnight, targeting storage facilities, command centres and observation points. One strike on the eastern village of Mashghara killed 12 people, including several members of the same family, Lebanon's state-run National News Agency said. Israel also warned residents of the city of Nabatiyeh to leave on Tuesday and struck an area near the Qaraoun Dam, the country's largest along the Litani River, though the Litani River Authority said there was no direct damage to the dam.

Israel has called up an additional battalion to Lebanon, an Israeli security official said on condition of anonymity. Mr Netanyahu said Israel was "operating with large forces on the ground and seizing strategic areas" and vowed to "increase the blows, increase the intensity."

At least 3,213 people have been killed in Lebanon since the start of the war, according to Lebanon's health ministry, with over 9,700 wounded. More than one million people have been displaced. According to Mr Netanyahu's office, 23 Israeli soldiers and a defence contractor have been killed in or near southern Lebanon.

Stuti Mishra27 May 2026 05:30

US military shows off fighter jet flying over Middle East

Rachel Dobkin27 May 2026 05:00

At least 31 killed in Lebanon as Israel launches one of heaviest nights of strikes since ceasefire

At least 31 people have been killed, including several children, in a heavy wave of Israeli strikes across southern and eastern Lebanon, Lebanon's health ministry said, after prime minister Benjamin Netanyahu vowed to "press the pedal even harder" against Hezbollah.

The Israeli military said it struck more than 100 Hezbollah infrastructure sites overnight in one of the heaviest bombardments since a US-brokered ceasefire began in mid-April. Strikes hit the Bekaa Valley village of Mashghara, where 11 people including a woman and two children were pulled from rubble, and Burj al-Shamali in the south. Some strikes hit near Beaufort Castle, a nearly 900-year-old UNESCO-recognised medieval fortress.

Speaking at a security cabinet meeting on Tuesday, Mr Netanyahu said Israel was "deepening our operation in Lebanon" and that the IDF was "operating with large forces on the ground and seizing dominant terrain."

Hezbollah said it targeted three barracks and a military post in northern Israel in response. Israeli strikes have killed at least 3,185 people in Lebanon since the conflict began on 2 March, according to Lebanon's health ministry.

Stuti Mishra27 May 2026 04:30NewerOlder

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