Ceasefire and nuclear negotiations between Washington and Tehran have moved forward after US and Iranian negotiators drafted a new agreement, but President Donald Trump has sent the proposal back with tougher demands, with Iran expected to respond within days.

Axios reported on May 31 that Trump requested several amendments to a draft agreement negotiated by his envoys and Iranian counterparts during a Situation Room meeting on Friday. Citing a senior US official and a second source familiar with the matter, the report said Trump also wants changes to wording concerning the reopening of the Strait of Hormuz. The senior administration official said Washington had been told it could take about three days for Tehran to respond. "They're literally in caves and they're not using email," the official said.

What the draft contains

The tentative pact, first reported by Axios, would extend the fragile ceasefire — in place since April 8 but repeatedly punctuated by skirmishes — for 60 days and begin negotiations on Iran's nuclear programme. The memorandum of understanding states that ship movements through the Strait of Hormuz will be "unrestricted" and no fees or tolls charged. Among the first issues to be negotiated during the 60-day window is what will happen to Iran's highly enriched uranium — the Islamic Republic holds 440.9 kilograms enriched to 60 per cent purity, a short technical step from weapons-grade levels of 90 per cent.

However, the draft memorandum contains no upfront agreement on what will happen to Iran's enriched uranium stockpile or its enrichment programme — those issues are simply listed as the first to be discussed in the 60-day talks. "Iran allows the strait to reopen, consents to further negotiations on its nuclear programme, but does not make any concessions up front," said Gregory Brew, a senior Iran and oil analyst at the Eurasia Group. "Overall this is a victory for Iran, which endured over a month of bombing, closed the strait, kept it closed and only agreed to reopen it via negotiated settlement with the United States. None of the stated war goals of the Trump administration — replacing the regime, re-creating the success in Venezuela, obtaining a sweeping nuclear deal or even forcing open the strait — were obtained."

Trump's demands and nuclear language

The latest exchanges remain focused on the two most contentious issues: the future of Iran's enriched uranium stockpile and restrictions on any potential nuclear weapons programme. Speaking in an interview with Fox News (NASDAQ: FOX), aired on May 31, Trump signalled that he was prepared to continue negotiations rather than rush towards a conclusion. "I'd like to say I'm in a hurry because gasoline prices are going to come tumbling down but if you are in a hurry you're not going to make a good deal," he said. "And if we do not get what we want, we are going to end it a different way."

Trump said negotiators had secured stronger language on nuclear weapons. According to TASS, he said: "They originally said we will not develop a nuclear weapon. I said, well, what happens if you buy a nuclear weapon?" He added that the draft now states Iran "will not develop or in any way purchase" nuclear weapons. "That's a big difference," he said.

Iran's economic collapse — and the Kharg threat

US Treasury Secretary Scott Bessent painted a stark picture of Iran's economic position, announcing new sanctions on Iran's Persian Gulf Strait Authority. "Their troops are not getting paid, the police are not reporting for work, and Kharg Island is shut down. The Iranian economy and currency are in free fall," Bessent said, adding that Operation Economic Fury "remains in full swing" even as peace talks continue.

Iran's internet, cut off during nationwide anti-regime protests and then during the conflict, has also begun to be restored after a monthslong shutdown.

Tehran's Ambassador to Zimbabwe Amir Hossein Hosseini warned separately that Iran could broaden its response, especially if the US attacked Kharg island — the country's critical oil export hub that was struck by US airstrikes on March 13.

"Any attack on Iranian sovereign territory or vital economic assets would be met with a firm and proportionate response," he told TASS, adding that retaliation "could extend to a broader range of strategic targets connected to the aggressors." He also expressed hope the dispute would ultimately be resolved through diplomacy. Iran has separately claimed the negotiations are at a "strategic deadlock" — a characterisation Washington disputes.

The regional dimension

The emerging deal also has a regional component that would include an end to continued fighting between Israel and Hezbollah. Pakistani and Qatari negotiators held talks with Iranian counterparts on Thursday and Friday while staying in regular contact with US envoy Steve Witkoff, the Financial Times reported. Iran's top negotiator told a Pakistani counterpart that Iran would not compromise its "legitimate rights" and expressed distrust of the US, Reuters reported. Haaretz

The conflict has set off what Gulf states have called the worst global energy crisis in decades. Oil markets are watching the negotiations closely — any deal reopening the strait would represent the single largest near-term relief for global supply.