Iran Demands U.S. Concessions First as Nuclear Talks Stall After Islamabad Deal

Three months after the United States and Iran signed the Islamabad Memorandum of Understanding to end their war, the nuclear diplomacy it was supposed to launch has hit a wall. Mediators are pressing Iran to offer concessions on its nuclear program to keep talks alive — but Tehran is refusing to move until Washington does, and President Donald Trump has already rejected Iran's most recent proposal.

Arab officials and mediators told The Wall Street Journal that Iran has made no compromises since Trump turned down a recent ceasefire offer, and that Tehran now wants the U.S. to offer concessions before any negotiations continue. Speaking to reporters at the United Nations General Assembly in New York on Thursday, Iranian Foreign Minister Abbas Araghchi said Iran had put forward a proposal to reopen the Strait of Hormuz within seven days, contingent on certain conditions being met and building on the June memorandum. Trump rejected the proposal on Saturday, telling reporters outside the White House: "They want to make a deal to open the Hormuz Strait immediately because they're losing so badly."

Right now, a concession at this time by any party would be considered an expression of weakness by the other and not just a willingness to settle matters.— Umer Karim, Gulf security researcher, University of Birmingham

Karim added that Iran believes Trump and the Republican Party will lose the midterm elections, an outcome that could push Trump toward greater willingness to use military force against Iran — and that this possibility is factoring into Tehran's calculations about the price of not yielding.

The standoff is the latest chapter in a conflict that escalated sharply in 2025. After Trump sent Iranian Supreme Leader Ali Khamenei a letter setting a 60-day deadline for a nuclear agreement, Israel launched large-scale airstrikes on Iran in June 2025 — targeting military leadership and nuclear scientists — starting what became known as the Twelve-Day War. The United States also struck Iranian nuclear sites. Iran suspended talks indefinitely. It was not until widespread protests erupted inside Iran that negotiations returned to the table in early 2026.

The February 28, 2026 U.S. and Israeli strikes that began the 2026 Iran war included the assassination of Supreme Leader Ali Khamenei and Ali Larijani, a key figure in the negotiations, according to reports. Pakistan brokered an initial ceasefire in April 2026, and mediated the talks that produced the Islamabad Memorandum, signed remotely on June 17 — Trump at the Palace of Versailles following the G7 summit, Iranian President Masoud Pezeshkian in Tehran.

The memorandum committed both sides to negotiate a final nuclear deal within 60 days, extendable by mutual consent. On the nuclear file specifically, it reaffirmed Iran's pledge never to develop nuclear weapons and agreed that Iran's stockpile of highly enriched uranium would be diluted on-site under International Atomic Energy Agency supervision. Crucially, the harder questions — future enrichment levels, program scope, verification — were deferred to the final deal. The U.S. committed in return to lift all sanctions on Iran, including primary and secondary sanctions and those at the United Nations, and issued an early license for Iran to sell oil and petrochemical products.

The ceasefire broke down within weeks. Iranian forces struck commercial vessels in the Strait of Hormuz on July 8, a move aimed at asserting Iranian sovereignty over the waterway that shattered the diplomatic calm. The U.S. retaliated, though negotiating teams still met in Doha on June 30–July 1 for a second round of implementation talks, and had previously met in Lucerne, Switzerland, on June 21–22 for the first post-memorandum round.

The nuclear verification problem sits at the center of the impasse. The IAEA's last verified estimate of Iran's stockpile — 440.9 kilograms of uranium enriched to 60 percent, enough if further enriched for several weapons — dates to June 13, 2025, more than a year ago, according to Foreign Policy. It is unclear how much of that stockpile survived subsequent U.S. and Israeli strikes on Natanz, Fordow, and Isfahan, or where it is now. Without a new verified baseline, the memorandum's core promise — freeze the program, get sanctions relief, negotiate a final deal — cannot be monitored.

Vice President JD Vance announced that Iran had "agreed to invite IAEA inspectors back into their country," calling it a "major milestone." Iran's foreign ministry pushed back directly, stating that Tehran had agreed to nothing new and rejecting any suggestion that inspectors would be allowed into sites damaged by strikes. Foreign Policy noted the contradiction may be procedural: Iran's parliament passed a law after the 2025 strikes requiring inspections to be approved by the Supreme National Security Council, so formally Iran has not changed its legal posture — but implementing the memorandum will require specific IAEA requests to receive a more positive response.

Until that agreement is reached, Iran is to 'maintain the current status quo' of its nuclear program. That is easier said than done because the status quo has not been self-evident ever since the June 2025 U.S. and Israeli strikes on Iran's nuclear sites.

According to one senior Middle East government official with direct involvement in the talks, who spoke to the WSJ, Iran had come close to making concessions on its nuclear program earlier this year in negotiations with Vance, but would require a firm guarantee that Israel would not strike Iran after any agreement with the U.S. was reached. Other officials said Iran is confident it could withstand a long-term U.S. blockade or renewed bombing campaign — a posture that reduces its incentive to move first.

Israeli Prime Minister Benjamin Netanyahu has said Israel is not bound by the interim memorandum and continues to insist Iran must give up its entire nuclear program as part of any agreement — a stance that makes it harder for the U.S. to offer Tehran reliable security guarantees. At the same time, Trump has threatened to resume attacks on Iran if no final deal is reached, even though the memorandum commits both sides to refrain from the threat or use of force.

The 60-day negotiating window set by the memorandum is extendable by mutual consent, but with no breakthrough in sight, the question is whether both sides can find a sequencing — who offers what, and when — that neither reads as capitulation.

Why it matters — Whether Iran and the U.S. can bridge this concession deadlock will determine if the Islamabad Memorandum produces a lasting nuclear deal or collapses into renewed conflict over a waterway that carries a significant share of the world's oil.

Sources differ on Whether Iran agreed to new IAEA inspection access: VP Vance said Iran agreed to invite IAEA inspectors back, calling it a 'major milestone'; Trump said Iran will agree to 'Major Weapons Inspections' (foreignpolicy.com) vs Iran's foreign ministry said Tehran has not agreed to anything new and rejects claims inspectors will access sites damaged by strikes (foreignpolicy.com)

Reported by wsj.com, iranwatch.org, jpost.com, newamerica.org, armscontrol.org, foreignpolicy.com, nytimes.com, en.wikipedia.org, commonslibrary.parliament.uk