Ceasefire in Iran Conflict: What Does the US Halt of ‘Project Freedom’ Mean?
Image source, Reuters
Reading time: 4 minutes
Following indications from US President Donald Trump that a ceasefire agreement with Iran might be possible, oil prices fell in Asia on Wednesday.
After Trump announced the operation of ‘Project Freedom’ in the Strait of Hormuz, fears of escalating conflict had increased. However, he later stated plans to have the US military secure and evacuate ships trapped in the Hormuz Strait are postponed for the time being.
On Wednesday, Brent crude oil prices dropped by 1.7% to settle at $108 per barrel. The price of US crude also decreased by 1.6% to $100.60. Earlier in the week, escalating attacks in the Middle East had driven prices up more than 6%, but they began to decline in subsequent days.
Since February 28, when the US and Israel initiated attacks on Iran, threats from Iran to target ships in the Strait of Hormuz caused global fuel prices to rise. The Hormuz Strait is key as 20% of worldwide oil and gas exports transit through this route.
Although a ceasefire has been announced between the US and Iran, a significant drop in oil prices has not yet occurred. The ceasefire period, initially declared on April 8, has been extended.
What Trump Said
Image source, Adam J. Dewey/Anadolu via Getty Images
On Tuesday, Trump stated via social media: “To see if we can make a deal with Iran, the decision has been made to temporarily pause ‘Project Freedom.'” Earlier, he had announced leading a mission to escort various countries’ ships out of the Strait of Hormuz.
The US military had planned to deploy 15,000 troops, 100 aircraft, and warships capable of launching targeted missiles in the operation.
However, the Iranian military asserted control over the Strait of Hormuz and warned of attacks against any foreign armed forces attempting entry, especially the aggressive US military.
Trump wrote, “Significant progress has been made towards a full and final agreement with Iranian representatives.” However, he also emphasized that the US will not cease obstructing Iranian port-bound watercraft.
The US continues to apply economic pressure on Iran.
According to the marine traffic monitoring website MarineTraffic, ship movements in the Strait of Hormuz on Wednesday remained notably low.
Meaning of the US Operation Halt
Image source, AFP via Getty Images
Strategist Charu Chanana, associated with investment firm Saxo, explains that halting Project Freedom signals “Washington’s desire to pursue a diplomatic resolution again.”
However, she does not view this as a definitive turning point.
“Is this a genuine step toward reopening trade through the Hormuz Strait? That is a critical question for oil traders,” she said.
Currently, however, there is no clear evidence to confirm this progress.
‘Initial Actions Against Iran Have Ended’
Image source, Reuters
US Secretary of State Marco Rubio stated that the initial operations carried out by the US and Israel against Iran have concluded and that Washington’s objectives have been achieved.
“We choose the path of peace. What the President seeks is an agreement,” he told reporters.
Iran has yet to respond to Rubio’s comments. However, the Speaker of the Iranian Parliament had previously stated that the process is underway and that “we all know the US cannot tolerate the status quo continuation.”
Concerns were raised that Project Freedom could threaten the ceasefire between the two sides.
Some Iranian media have portrayed the postponement of Project Freedom as a victory for Iran.
“Trump has backed down,” claimed the hardline Tasnim news agency, affiliated with the Islamic Revolutionary Guard Corps, alleging the US president seeks to “cover up his failure.”
Iran’s government-run IRNA news agency called it “America’s defeat” and said Trump has played his “last card.”
The US had reported striking some Iranian “fast boats” in the Strait of Hormuz. The UAE accused Iran of attacking a port supplying oil, an accusation Tehran denies.
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