US, Iran to Start Negotiations in Islamabad Friday, Whether Ceasefire Can Continue Remains Uncertain

TradingKey - Following Trump's announcement of a two-week suspension of bombings against Iran, negotiations between the U.S. and Iran regarding a ceasefire and the Strait of Hormuz have been placed on the agenda.

According to Reuters, Pakistan played a key role in mediation and pushed both sides to begin talks in Islamabad this Friday (April 10); Trump stated that the current ceasefire arrangement is predicated on Iran immediately and fully reopening the Strait of Hormuz.

However, the outlook for negotiations is far from easy. According to senior Iranian officials, Tehran has set clear preconditions, including that the U.S. must immediately cease military strikes and guarantee that such actions will not recur, while also demanding compensation for damages. Iran also opposes a "temporary ceasefire," preferring to reach a permanent peace agreement.

Markets responded swiftly to this ceasefire development. Previously, the Strait of Hormuz had been under pressure due to the conflict, affecting approximately one-fifth of global seaborne oil shipments and causing oil prices to fluctuate violently.

As ceasefire signals emerged, both Brent crude and WTI retreated significantly, WTI dropped below $100.00 intraday, with daily losses currently reaching nearly $20. Asian stock markets rebounded, but Reuters also cautioned that missile attacks have not fully ceased and the situation remains fragile.

Analysts noted that the key to Friday's talks is not only whether a brief ceasefire can be maintained, but also whether the U.S. and Iran can establish an enforceable framework for transit through the Strait of Hormuz, sanctions arrangements, and subsequent security guarantees. If negotiations progress smoothly, the geopolitical risk premium is expected to continue receding; if disagreements widen, the oil market and global risk assets could still experience sharp volatility again.