Will the U.S.-Iran Cease-Fire Hold?

0:05This morning, the clock starting on a two-week ceasefire announced by President Trump. A last-minute reversal on his threat to take the entire country out. The U.S. has, quote, received a 10-point proposal from Iran and believes, quote, it is a workable basis on which to negotiate. Iran's foreign minister confirming the reopening of the critical Strait of Hormuz during this ceasefire period. After days of escalating tensions in the war between Iran and the U.S., the two countries announced a ceasefire last night. It was an off-ramp right at a moment of crisis. Here's the Journal's Washington bureau chief, Damian Paletta.

0:41For the U.S., it's not going to do what President Trump threatened to do, which was to blow up all their bridges, power plants, and things like that. So for the next two weeks, the U.S. has essentially said they're going to stand back. They'll still have the military there and be ready, but they're not going to continue bombing Iran. Now, one of the big questions is, is Iran going to reopen this kind of waterway that is along its shore, the Strait of Hormuz, where a lot of commercial traffic goes through, including a lot of traffic that carries oil, but also other things too.

1:20While the U.S. and Iran have agreed to stop fighting for now, Damien says this ceasefire is fragile. These are two countries that have a long history of hating each other and not trusting each other. Can they get to a place where they might see a mutually beneficial off-ramp? I'm not sure, but it's where we are right now.

1:43Welcome to The Journal, our show about money, business, and power. I'm Jessica Mendoza. It's Wednesday, April 8th.

1:56Coming up on the show, Iran and the U.S. have reached a ceasefire. Can it hold?

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2:47The terms of the ceasefire between the U.S. and Iran are still very unclear. Trump said in a Truth Social post on Tuesday that the U.S. had received a 10-point proposal from Iran that was a, quote, workable basis on which to negotiate. A public version of Iran's 10-point plan calls for, among other things, a removal of sanctions and acceptance for Iran to enrich uranium. They want the U.S. to leave Iran alone and Iran's proxies alone. Iran also wants to be compensated for all the things the U.S. has blown up. Okay, we've blown up a lot of things in Iran. And so I don't know how they think they're going to be compensated for that.

3:28You know, a lot of their ships have been sunk. A lot of their leaders are dead. I don't really know what that looks like. It's not a—there's not a lot of precedent for the U.S. just writing a check for the things that it has destroyed with its military. So that's going to be an interesting conversation or clause there if Iran's really going to stick to that. But there's another plan the U.S. has floated, a 15-point plan. And earlier today, Trump said in another Truth Social post that there's only one set of points that are acceptable to the United States. He added, quote, these are the points that are the basis on which we agreed to a ceasefire.

4:03White House Press Secretary Caroline Levitt has called Iran's 10-point plan, quote, deeply unserious and said there's no way Trump would agree to it. This afternoon, a high-level Iranian official said on X that the U.S. had already violated his country's 10-point framework to end the war, and that because of that, a ceasefire in negotiations would be effectively meaningless. Even with this confusion, and with parties seemingly disagreeing on a lot, peace negotiations are still planned in Pakistan for this weekend. In the meantime, the current ceasefire is focused on access to the Strait of Hormuz, a major waterway for much of the world's oil that Iran took control over.

4:44What did Iran actually agree to? Is it currently open? I mean, it's not like there's a piece of paper where they signed something that says, here's what we've agreed to. They have not reopened the Strait of Hormuz. The Iranians have, just like they have for the past few weeks, there are certain ships they will allow to go through with their permission, almost with like their military's consent. That has not changed. It's possible later this week that they open up the number of ships, the kind of ships, the origin of the ships that are allowed to go through for the next two weeks. There is such a huge traffic jam in the Strait of Hormuz that it's impossible to think that in the next two weeks, they're going to be able to get everything through.

5:19And obviously, if you're a company that owns a big ship, you might think twice about whether you want to get in that queue anyway. Right. Right. And just to be clear, I mean, opening up the strait is different than Iran giving up control of it, right? Correct. There's no sign that Iran in perpetuity has any plans to give up its control or its ability to kind of manage what goes through the strait or Hormuz. They have not agreed to that. And I can't imagine they ever will because that's their leverage. They can just shut it down if they don't think things are going well. And it's not easy, as we've learned, for the U.S.

5:52to just, you know, bomb it and reopen it. So Iran wants to be able to kind of charge a toll. They want to make money off the Strait of Hormuz. That could drive up costs for everyone around the world because you're having to pay higher prices. So the whole, like, dynamic has changed now. And Iran realizes they have leverage in places they didn't before. Somehow a version of the regime still exists. And they might use this two weeks to try to come up with things that they kind of demand on behalf of the United States. The U.S. and Iran used intermediaries to negotiate the ceasefire. Pakistan's prime minister was a key mediator in brokering the deal.

6:29How did this plan come together? I mean, can you tell me about Pakistan's role in this? Great question. I was kind of asking my team that Tuesday morning, how did Pakistan, of all places, get in the middle of this? President Trump has a good relationship with Pakistan. Pakistan is trusted by the Iranians. So somehow they became the intermediary that was, you know, very involved in shuttling proposals back and forth. And we'll find out in the next two weeks, or maybe even sooner than that, whether they're good at appeasing both sides and kind of keeping that, continuing that trust. Because like I said, there's a long history of bad blood between these two countries, the U.S.

7:06and Iran. After the ceasefire was announced, both the U.S. and Iran declared victory. Operation Epic Fury was a historic and overwhelming victory on the battlefield. A capital V military victory. That's Secretary of Defense Pete Hegseth at a press conference this morning. What's clear, what the Iranian, the new Iranian regime knows, is they'll never have a nuclear weapon or the capability to get a path to one. So, Damian, you heard the defense secretary in his press conference this morning. Is this a decisive victory for the U.S.? Time will tell. I mean, they did destroy a lot of military sites.

7:48A lot of Iranian leadership has been killed. And in that respect, the U.S. felt like it, you know, hit Iran in a way that the country had never been hit before. But some version of its regime did survive. And they did find a way to just have this choke point in the Strait of Hormuz that allowed them to force Trump into a ceasefire from their perspective. One of the things that Hegseth said was that what the U.S. has done is that it has slowed Iran's capability to make nukes for a very long time, if not permanently. Is that true? I mean, they still have uranium. Right. They still have uranium. It's unclear what's buried under tons of rubble in the sites that the U.S.

8:30hit really hard previously in 2025. I think this is one of those things. I mean, understanding the Iranian nuclear capacity and ambitions is a challenge that has faced Democratic administrations and Republican administrations. And then there's people in the intelligence community who have different opinions, and there's politicians in the U.S. who have different vantage points. There's still uranium existing. Now, it might be buried under tons of rubble. I have to imagine it's hard to get, but we don't have all the information. And this is the most classified of classified kind of things. And Iran is also claiming victory on its side, despite all of the military losses it's sustained.

9:08So what is it that they're saying? So in the months leading up to this whole thing, remember there was these protests in Iran that made it look like the regime could be in trouble. And so we go through this, you know, past five or six weeks. Iran's almost brought to its knees, but they find out if they took off the Strait of Hormuz, they can still kind of hold off and arrest the whole global economy. They show that they still have some power, even with kind of a busted up military and a broken regime. And so for them, they can show that they're still internationally relevant and that they still have this new way to control global trade.

9:42They're able, with gas prices soaring, they're able to find ways to make more revenue. So they're still there. There's a version of their regime that exists. What could make the ceasefire fall apart in the next two weeks? I mean, it's the Middle East, so most ceasefires do fall apart. There's a lot of characters and actors with a lot of weapons, with a lot of motives. How does Israel act in the next two weeks? How did the Iranian proxies act in the next two weeks? Is there a centralized Iranian government where one leader can tell the other parts to stop, put down your weapons? I don't know. We haven't really been tested that way in terms of the new global dynamic.

10:24So I think there's a lot of things that could go wrong. Across the Middle East, battles rage on. The ceasefire agreement doesn't impact Israel's ongoing conflict with Hezbollah in Lebanon. The Israeli military said it carried out strikes on more than 100 targets in Lebanon on Wednesday. And Iran has continued to fire missiles and drones at neighboring countries. Not to mention, there are tens of thousands of U.S. troops in the region, and there are no immediate plans to pull them back. After the break, the ramifications of Trump's strategy.

11:13We'll see you next time.

11:43In the lead-up to the ceasefire, Trump made several threats against Iran. It started on Easter Sunday, when he said the U.S. would bomb civilian infrastructure, power plants, and bridges. And it escalated on Tuesday, when he posted on social media that, quote, quote, a whole civilization will die tonight if Iran didn't agree to a deal by his 8 p.m. deadline. Well, it's a real challenge in terms of following the reporting because there's been many times in his second term when, whether it's tariffs or other foreign policy matters, he'll threaten something and then oftentimes look for an off-ramp right at the last minute.

12:19So, you know, his critics call this the taco, Trump always chickens out. And their theory is the markets shouldn't get too worried because he's not going to end up doing something that's going to have dramatic impacts on, you know, the stock prices or gas prices. But there are times when he does it, when he does go into Venezuela, when he does bomb Iran. And so he always does have this element of keeping people, everyone off guard and on their toes. And so here we were again. So was this taco, you know, Trump chickening out? Or was it a negotiating tactic that succeeded? Great question. And you'll get a different answer based on who you ask.

12:59So in the White House's view and in the view of President Trump's supporters, you have to speak the Iranians' language, right? You have to threaten to destroy their civilization because that's the language they speak. They're always threatening to destroy Israel or death the United States. So if you want to get their attention, you have to speak their language. So that's what he did on Tuesday morning. He said he would destroy their civilization. It caused panic, you know, through Washington and New York and global capitals and even got people in the Republican Party to say he's gone too far. But in their view, it finally got Iran to reopen the Strait of Hormuz.

13:36Now, we haven't seen them reopen it yet, but that's what allegedly has been agreed to. So, on the other hand, he's done this so many times where he's threatened incredibly painful things, unilateral things, whether it's this wiping out a civilization of 93 million people or, you know, unilaterally imposing tariffs and this and that, where he'll back out at the last minute. And there's a risk for him that people become so desensitized and accustomed to him backing out at the last minute that they stop taking these threats seriously. And that takes away his leverage. You know, Trump's war effort hasn't been very popular in the U.S.

14:18There was a Pew survey conducted at the end of March that found that only 35 percent of Americans were either very or somewhat confident in Trump's decision making on Iran. How does the ceasefire affect that? President Trump, he was in a situation where he has major domestic political problems that this war caused. The gas prices were going up. There's a view that gas prices might still keep going up. That's politically disastrous, and not to mention what it means for the economy. And then we have a sense within the Republican Party that they're very split over this. He ran on, you know, focusing on the domestic issues, not getting caught in forever wars abroad.

14:56And then here he is in this mission in Iran that didn't have an easy end date. And so his party was sort of cracking apart. A lot of conservative talk show hosts were splintering. And so he still has to repair that. This ceasefire two weeks, whatever, however it's going to last, it's not going to solve all his problems. But it might be a start. Will the ceasefire halt the gas price spikes that we've been seeing? I don't believe it will because there's still just so much uncertainty about the way that oil is going to move around the world. And so I would have to think, especially if the Iranians now think they can charge like a carrier fee or like a gate fee on the barrels.

15:35So I would assume that gas prices are going to stay high and in fact continue going up. It's going to depend on different parts of the country. But as we get closer to Memorial Day, I can see a scenario where this might be a really expensive summer for Americans. And that can change consumer behavior. That can change all kinds of things. But unless there's like a permanent solution here that reopens the strait and actually expands somehow, refining capacity, we could be in for, you know, a very expensive summer and fall, which is the last thing Republicans need heading into the midterms of November.

16:12What happens if the U.S. and Iran can't get to a full or permanent peace plan in the next two weeks? Are we just back to where we started? My prediction is that in the next two weeks, there will be signs that we're about to go sideways again. There will be threats. There will be new ultimatums. The most likely scenario is that this two-week thing will be extended again. You know, they'll make progress in the talk. Maybe they agree on two of the things, but let's keep trying. We're talking. And so, you know, they just keep punting it out two weeks at a time. In a world of diplomacy, that kind of works.

16:48That's how things work. We're not really in a world of diplomacy right now. We're in a world of military action on all sides. And so there's a chance, too, if gas prices start coming down and the stock market goes back up, President Trump might think we inflicted a lot of damage on them. You know, we kind of made our point. Their nuclear ambitions are set back. We can move on. But if he feels like, you know, Iran's shooting rockets and drones and straight-arm moves and they didn't learn their lesson in his viewpoint, then it's possible that they might have to go back in with the military. So we'll know more soon, but I imagine there's going to be lots of twists and turns here.

17:36That's all for today, Wednesday, April 8th. The Journal is a co-production of Spotify and The Wall Street Journal. If you like our show, follow us on Spotify or wherever you get your podcasts. We're out every weekday afternoon. Thanks for listening. See you tomorrow.

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