World awaits fate of ceasefire

WASHINGTON/CAIRO: Concerns grew on Monday ​that the ceasefire between the United States and Iran might collapse after the US said it had seized an Iranian cargo ship that tried to run its blockade and Iran vowed to retaliate.
Efforts to build a more lasting peace in the region also appeared under threat, as Iran said it would not participate in a second round of negotiations that the US had hoped to kick off before the ceasefire expires.
The US has maintained a blockade of Iranian ports, while Iran has lifted and then reimposed its own blockade on marine traffic passing through the Strait of Hormuz, which typically handles roughly one-fifth of the world's oil supply.
Iranian state media reported ​that Tehran had rejected new peace talks, citing the ongoing ‌blockade, threatening rhetoric, and Washington's shifting positions and 'excessive demands.'
'One cannot restrict Iran's oil exports while expecting free security for others,' Iran's First Vice-President Mohammad Reza Aref wrote on social media. 'The choice is clear: either a free oil market for all, or the risk of ​significant costs for everyone.'
Trump earlier warned Iran that the US would destroy every bridge and power plant in Iran if Tehran rejected his terms, continuing a recent pattern of such threats.
Iran has said that if the United States were to attack its civilian infrastructure, it would hit power stations and desalination plants of Gulf Arab neighbours.
Trump said his envoys would arrive in Islamabad on Monday evening, one day before a two-week ceasefire ends.
A White House official said the US delegation would be headed by Vice-President JD ‌Vance, who led the war's first peace talks a week ago, and also include Trump's envoy Steve Witkoff and son-in-law Jared Kushner.
Pakistan, which has served as the main mediator, was still gearing up for the talks on Monday.
Nearly 20,000 police, paramilitary and ​army personnel have been deployed across the capital Islamabad, a government and a security official said, adding that the area around the venue for the second round of talks had been vacated.
Public transport across the city has also been suspended.
Investors were on edge approaching the end of the US-Iran ceasefire, with Washington saying it will send a delegation to Pakistan for a new round of talks 'soon' and Iran saying it had yet to decide whether to attend.
'The market mood is very different at the start of the week compared to Friday,' said Kathleen Brooks, research director at trading group XTB.
Crude had plunged on Friday after the Islamic republic said it would again allow ships to pass through the Strait of Hormuz, through which a fifth of global oil and liquefied natural gas usually passes.
But world oil prices bounced on Monday as Iran closed the waterway and said the US blockade and seizure of an Iranian cargo ship breached the two-week ceasefire.
'Renewed attacks on commercial vessels in the Strait of Hormuz increased fears of supply disruptions and raised the risk of a broader escalation in hostilities between the US and Iran,' said Trade Nation analyst David Morrison.
'Uncertainty also remains over whether negotiations in Islamabad will proceed after Iran said it would not attend talks while the blockade remains in place,' he added.
Analysts at the International Crisis Group think tank said Iran's strategy for Hormuz was to signal it was open to diplomacy, 'but only on terms that show it has not suffered strategic defeat'. — Agencies