Long-delayed law may ease Iran's way out of financial isolation

Brent crude futures dropped as much as 3.7% to $63.68 a barrel in early trade before paring losses to $63.98. US West Texas Intermediate (WTI) crude fell 3.3% to $61.05.

The sell-off followed remarks by US President Donald Trump, who said Washington was in "very serious negotiations with Iran for long-term peace" during his tour of the Persian Gulf, adding that Tehran had "sort of" agreed to US terms for a possible deal.

Traders view a possible agreement as a step toward easing sanctions on Iran, which could pave the way for the return of Iranian oil exports to global markets.

Adding to the downward pressure, data released late Wednesday showed an unexpected build in US crude inventories last week, fueling concerns about oversupply.

"The market is reacting to both the political developments and the inventory surprise," said a trader at a London-based commodities firm. "Any indication that Iranian barrels could re-enter the market weighs on prices."

Earlier this week, markets rallied on a US-China trade truce and a flurry of investment deals unveiled during Trump's visit to the Middle East.

Still, oil markets remain volatile as investors weigh the potential timing and terms of any US-Iran agreement, along with broader macroeconomic risks.

Across Persian-language social media, many users were almost in awe, surprised with both the content and tone of Trump’s speech. Even journalists inside Iran couldn’t help risking reprimand by praising a US president.

“It was so intelligent of Trump to highlight issues such as the destruction of monuments and the water mafia,” renowned journalist Sadra Mohaqeq wrote on X. "And what a coincidence that he said all this on the same day he lifted US sanctions on Syria."

In his speech in Riyadh, Trump described the Islamic Republic as a “destructive” force, accusing the rulers in Tehran of “stealing their people’s wealth to fund terror and bloodshed abroad,” just as neighboring Arab leaders were building their countries.

"No one could have described the situation of a plundered country in a few sentences better than Trump," Middle Eastern Studies student Masoud Paydari posted on X.

"He uttered the harshest and most bitter words with complete politeness," a classmate commented under his post.

Trump had no good words for Iran’s supreme leader Ali Khamenei but all the world’s praise for Mohammad Bin Salman. Still, he left the door open for a “better and hopeful future” if Tehran chose to change course.

"He spoke as if he were a fellow Iranian chatting with a friend. His words were so clear. Iran’s officials should die of shame," user Maryamgh wrote on X. Many agreed, suggesting that an Iranian writer may have helped draft the US President’s speech.

Trump’s comments on Iran’s nuclear program were largely overlooked by Iranians on social media. It was his lengthy and detailed remarks about mismanagement, economic waste and cultural neglect that clearly struck a nerve.

"In a country on the southern part of the Persian Gulf, major international investors line up to offer cooperation, while another country on the northern part of the same gulf is left with no trade partners,” a user posting as Cryptosamz wrote on X, “because all its officials, from top to bottom, are thieves."

While social media users reacted with rare openness, Tehran’s major dailies remained conspicuously silent. Under apparent pressure not to credit Trump in Iran's tightly-controlled media landscape, they avoided the speech altogether.

Hardliners largely ignored it as well.

Kayhan, whose chief is appointed by Khamenei, was the only paper to address the speech directly, dismissing it as "reckless" with little elaboration. The IRGC-linked Javan stuck to its combative line. "We won’t negotiate if they insist on zero enrichment," read the headline.

State media covered Trump’s visit without pointing out its economic significance.

The wealth being amassed on the other side of the Persian Gulf was derided as mere "petrodollars," with no words of self-reflection on why they freely sell oil, reinvest profits, and fund global ventures as Iran—sitting on comparable if not superior natural resources—struggles to meet basic needs like water and electricity.

While Trump’s trip may not have fundamentally shifted the course of Iran-Saudi relations, it underlines how central their evolving dynamic remains to the region’s future especially as nuclear negotiations between Tehran and Washington continue to unfold.

On Wednesday, Saudi Foreign Minister Faisal bin Farhan underscored the importance of the US-Iran nuclear talks, saying the kingdom fully supports them and hopes for a positive outcome.

Iran's Foreign Minister Abbas Araghchi, in turn, visited Saudi Arabia on Saturday before the fourth round of talks with the US to brief them on the latest developments. He had said last Wednesday that Tehran seeks regional consensus on the talks and any potential deal.

Rivalry and diplomatic tension

The two regional powerhouses have long been vying for influence across the Middle East. Their rivalry has played out in a series of proxy conflicts over the past two decades — from Iraq and Bahrain to Syria and Yemen — where the two sides supported opposing factions.

One of the most acute flashpoints came in 2015, when Riyadh launched a military campaign in Yemen against the Iran-backed Houthi rebels. Although Tehran has always denied direct military involvement, it has been widely accused of supplying weapons and political support.

Relations deteriorated further in 2016 after Saudi Arabia executed prominent Shia cleric Sheikh Nimr al-Nimr. The move sparked violent protests and attacks on Saudi diplomatic missions in Tehran and Mashhad, prompting Riyadh to sever diplomatic ties. This marked one of the lowest points in bilateral relations in decades.

Aramco attack

A September 2019 drone and missile attack on the state-owned Saudi Aramco oil hub that disrupted about five percent of global oil supply marked one of the most significant escalations in the Tehran-Riyadh relations in recent years.

Although the Houthis claimed responsibility and Iran denied any involvement, the sophistication of the weaponry used in the attacks led not only Riyadh and Washington but also European powers to directly blame Iran.

Riyadh appeared to change tack away from years of direct and indirect confrontation with Tehran gradually after the assault on its economic lifeline, paving the way for detente.

Signs of a diplomatic thaw

The recent years have seen a cautious thaw in relations. After the initiation of direct talks in April 2021, a breakthrough came in 2023 with Chinese-brokered talks that led to the restoration of diplomatic relations. Since then, both sides have tentatively explored cooperation and re-engagement, even as deep-seated mistrust remains.

From early 2025 to now, Iranian and Saudi officials have held multiple high-level meetings.

Saudi Arabia has reportedly also positioned itself as a backchannel mediator between Iran and the United States in nuclear talks in the past few months.

Recent diplomatic engagements

Diplomatic momentum picked up pace in October 2024, when the newly appointed Araghchi visited Riyadh and met with Crown Prince Mohammed bin Salman and foreign minister amid growing the growing Gaza conflict.

A few weeks later, the Saudi Crown Prince’s call to Israel to cease all hostile actions on Iranian territory surprised many.

Further momentum came in April when Saudi Defense Minister Prince Khalid bin Salman made a rare visit to Tehran, delivering a letter from King Salman bin Abdulaziz to Iran’s Supreme Leader Ayatollah Ali Khamenei.

The timing — just days before another round of Tehran-Washington nuclear talks — underscored Saudi Arabia’s possible diplomatic involvement.

Araghchi returned to Riyadh on May 10, ahead of the fourth and most recent round of nuclear talks in Doha. Iranian media reported that he delivered a response to the Saudi king’s letter, continuing what appeared to be an unprecedented backchannel of direct communication.

Toward a regional nuclear consortium?

During Trump’s meetings in Riyadh, the possibility of a civil nuclear agreement between the US and Saudi Arabia was reportedly discussed.

In one of the most intriguing diplomatic moves of 2025, Iran is believed to have proposed the creation of a regional uranium enrichment consortium with Saudi Arabia, the United Arab Emirates, and the United States.

The initiative, not officially confirmed by either Tehran or Riyadh so far, may have been pitched as a confidence-building measure designed to reassure the West about Iran’s nuclear intentions while embedding regional powers and the United States in a shared framework.

Saudi Arabia, long intent on developing its own civilian nuclear capabilities, may view such a proposal as an opportunity to gain influence over regional nuclear policy while maintaining checks on Iran’s activities. However, significant technical and political obstacles would need to be overcome.

The move could ease Iran’s exit from the international money laundering blacklist and restore access to global banking should Western sanctions against it be lifted.

In a brief statement, the council's spokesman Mohsen Dehnavi announced it had agreed to join the UN convention against transnational organized crime, “within the framework of the Constitution and domestic laws.”

The decision marks a cautious step toward meeting FATF requirements but falls short of full endorsement.

The council also confirmed that discussions on the related Countering the Financing of Terrorism (CFT) bill will continue in upcoming sessions.

The move comes amid strong opposition from over 150 hardline lawmakers, who last month urged the Council to reject both conventions.

In a letter to Expediency Council chairman Sadeq Amoli Larijani, they argued that any approval—conditional or not—should wait until the risk of the UN “snapback” sanctions mechanism is entirely eliminated.

The snapback mechanism, which allows for the automatic reimposition of UN sanctions under the 2015 nuclear deal, is set to expire in October 2025 unless triggered by a signatory.

While Larijani recently hinted that conditional approval might be viable, conservative MPs have warned that even limited compliance could make Iran vulnerable to external pressure and economic penalties.

The FATF has kept Iran on its blacklist due to its failure to adopt international standards on money laundering and terror financing.

“It is unclear what was discussed over the past month. There is no detail on substance or format, nor any indication of whether an agreement is likely,” Vatan Emrooz wrote in its editorial following the fourth round of talks in Oman last weekend.

“The US’s repeated calls to halt enrichment cast doubt on its seriousness … Perhaps the only objective at this point is to ensure the talks do not collapse,” the editorial added.

While the ultra-conservative daily was more subdued than usual, the message was clear: the process, not the outcome, is what matters.

Kayhan, a hardline paper closely aligned with the Supreme Leader’s office, also struck a defiant tone, giving a rare front-page place to foreign minister Abbas Araghchi who said Tehran will not negotiate enrichment.

Muted optimism, missing details

Other outlets—across both reformist and conservative camps—offered a more coordinated and cautiously positive framing, though still with limited substance. Etemad and Jomhouri Eslami both described the talks as successful but provided no insight into what had actually transpired.

The only notable detail was Etemad’s assertion that the latest round of talks were both direct and indirect, clearly contradicting the official line that the negotiations had been strictly indirect.

Two prominent political commentators, Mohammad Sadeq Javadi-Hesar and Heshmatollah Falahatpisheh, acknowledged the information vacuum but urged against equating public messaging with actual policy.

"The outcome of the fourth round of talks has isolated warmongers and opponents of Iran," Javadi-Hesar wrote in Etemad on Monday.

Falahtpisheh went one step further, commenting on US politics. “If both sides have decided to continue negotiations, it means that Steve Witkoff’s statement before the talks, about ending enrichment in Iran, was aimed at silencing opposition within the US.”

A Consortium on the Table?

One potentially significant development came via Khorassan, a conservative daily, which reported that Oman’s Foreign Minister Badr bin Hamad Al Busaidi had proposed a regional “nuclear consortium” involving Iran, Saudi Arabia, and the UAE—with the United States as a symbolic shareholder.

Khorasan quoted Witkoff as describing the idea as “a surprise that can be considered.” Such an arrangement, the paper asserted, could address regional security concerns about Iran’s nuclear transparency and dilute fears of its technological monopoly.

Most upbeat was the Reform-aligned daily Sharq, which described the talks in Oman as a new life to diplomacy. And most eloquent, perhaps, was the centrist outlet Ham-Mihan, printing “back to square one” on its front page.

Iran will not accept zero enrichment or transfer of its enriched uranium abroad, the daily wrote in its editorial, unless there is a phased agreement and verifiable US sanctions relief.