Iran and the United States on Monday downplayed the chances of an imminent breakthrough in the three-month-long war, as US Secretary of State Marco Rubio said Washington would either reach a good agreement with Iran or deal with it “in another way.”

Rubio told reporters in New Delhi that the United States would give diplomacy every possible chance to succeed before turning to “alternatives,” after US President Donald Trump said on Sunday that he had instructed his representatives not to rush into any agreement with Iran.

Rubio added that there is a “very serious offer on the table” regarding Iran’s ability to reopen the strait and enter into real, meaningful, and time-bound negotiations over the nuclear file, expressing hope that an agreement could be achieved.

Meanwhile, Iranian Foreign Ministry spokesman Esmail Baghaei said on Monday that Iran is negotiating to end the war, but is not currently discussing nuclear issues.

Baghaei added that a general framework had been reached, but no one could say that an agreement between the United States and Iran was imminent. He explained that the potential memorandum of understanding does not include specific details regarding the management of the Strait of Hormuz, which falls under the authority of the countries overlooking it.

Trump wrote on his Truth Social platform on Sunday that the US blockade imposed on Iranian vessels in the Strait of Hormuz would remain “fully in effect until an agreement is reached, approved, and signed.”

He added: “Both sides should take their time to reach the right agreement.”

Oil prices fell 5% to their lowest levels in two weeks on Monday as optimism grew that the United States and Iran may be nearing a peace agreement.

Points of disagreement

Trump raised expectations on Saturday when he said Washington and Tehran had “largely negotiated” a memorandum of understanding on a peace agreement that would reopen the Strait of Hormuz.

The Iranian Foreign Ministry spokesman said on Monday that Iran would not impose transit fees through the vital waterway, but added that “it is natural for there to be costs for the services provided.”

Before the conflict erupted, one-fifth of global oil and liquefied natural gas shipments passed through the strait.

Disagreements remain between the two sides over several complex issues, including Iran’s nuclear ambitions, Israel’s war in Lebanon against the Iran-backed Hezbollah militia, as well as Tehran’s demands for sanctions relief and the release of tens of billions of dollars in Iranian oil revenues frozen in foreign banks.

A senior Trump administration official, speaking on condition of anonymity, revealed the broad outlines of the issues under negotiation.

The official said Iran had agreed “in principle” to reopen the Strait of Hormuz in exchange for the United States lifting the naval blockade and for Iran to dispose of its stockpile of highly enriched uranium.

He added that the United States believes Iranian Supreme Leader Ayatollah Mojtaba Khamenei has approved the general framework of the agreement.

The official rejected claims that Iran had not agreed to dispose of its stockpile of highly enriched uranium, saying: “The issue is about how it will be implemented.”

A second senior US official said on Sunday that the proposed framework gives negotiators a 60-day deadline to reach a final agreement.

Iranian sources had previously told Reuters that “workable formulas” could be found in the coming stages to resolve the dispute over the highly enriched uranium stockpile, including reducing enrichment levels under the supervision of the United Nations’ International Atomic Energy Agency.

Fragile truce

Iran has long denied US and Israeli accusations that it seeks to acquire nuclear weapons, insisting that it has the right to enrich uranium for civilian purposes, although the enrichment levels it has reached far exceed what is required for power generation.

Trump’s popularity has been hurt by the war’s impact on energy prices in the United States, while he has also faced pressure from Congress to limit his war powers. As a result, he has repeatedly spoken about the possibility of reaching an agreement to end the conflict that began when the United States and Israel launched attacks on February 28.

A fragile truce has remained in place since early April.

Responding to critics of his handling of the negotiations and his willingness to make concessions to Iran, Trump said: “If I make a deal with Iran, it will be a good and proper deal... so don’t listen to the losers criticizing something they know nothing about.”

Any agreement that strengthens the current fragile truce would provide some relief to markets, but it would not immediately end the global energy crisis that has driven up fuel, fertilizer, and food costs.

The US-Israeli bombing campaign against Iran killed thousands of people inside Iran before it was suspended in early April. Israel also killed thousands more and displaced hundreds of thousands from their homes in Lebanon during its campaign against Hezbollah. Meanwhile, Iranian strikes on Israel and neighboring Gulf countries resulted in dozens of deaths.

Gold prices rose by more than 1% on Monday as optimism grew over the possibility of a breakthrough in peace negotiations between the United States and Iran, leading to a weaker dollar and lower oil prices, which in turn eased inflation concerns.

Spot gold climbed 1.1% to $4,559.07 per ounce by 07:36 GMT, while US June gold futures rose 0.8% to $4,559.80.

Although US President Donald Trump warned that he was not in a hurry to finalize an agreement with Iran, investors appeared more focused on his remarks on Saturday, when he said Washington and Tehran had “largely completed” a memorandum of understanding on a peace deal that could lead to the reopening of the Strait of Hormuz.

Tim Waterer, chief market analyst at KCM Trade, said: “Trump boosted market hopes for some form of agreement with Iran that could lead to the reopening of the Strait of Hormuz. That possibility pressured oil prices and provided gold with welcome support from an inflation perspective.”

Meanwhile, US Secretary of State Marco Rubio said on Monday that the United States would either reach a “good agreement” with Iran or handle the matter “in another way.”

The dollar fell close to its lowest levels in a week, making gold priced in the US currency less expensive for holders of other currencies.

Oil prices also dropped to their lowest levels in two weeks, easing inflation expectations.

Higher oil prices typically fuel inflation and keep interest rates elevated for longer periods. Although gold is considered a hedge against inflation, higher interest rates usually pressure the yellow metal because it does not generate yield.

In a related development, Kevin Warsh was sworn in as chairman of the US Federal Reserve on Friday at a sensitive moment for the American economy, as sharp increases in fuel prices linked to the war with Iran continue to drive inflation higher and weaken consumer confidence.

As for other precious metals:

Spot silver rose 3.1% to $77.79 per ounce,

Platinum gained 2.3% to $1,966.59,

while palladium climbed 2.7% to $1,384.70 per ounce.

Oil prices fell by around 5% on Monday after US President Donald Trump signaled progress in talks with Iran over reopening the Strait of Hormuz, although he stressed that the United States would not rush to finalize a deal.

US West Texas Intermediate crude futures dropped about 5.8% to $90.95 a barrel by 7:35 a.m. Eastern Time, while global benchmark Brent crude futures fell by nearly the same percentage to $97.60 a barrel.

Trump said in a social media post on Sunday: “The negotiations are proceeding in an organized and constructive manner, and I have instructed our representatives not to rush into an agreement because time is on our side.”

The US president had said on Saturday that an agreement with Iran regarding the reopening of the Strait of Hormuz and other issues had been “largely negotiated” and would be announced soon.

Trump had previously suggested that the conflict with Iran was close to being resolved before tensions escalated again and oil prices surged.

US crude lost more than 8% last week, while Brent crude fell by more than 5%, after Trump said he had canceled imminent airstrikes on Iran to allow more time for negotiations.

Despite the recent declines, prices remain more than 30% higher since the United States and Israel launched attacks on Iran on February 28.

Iran has imposed an effective blockade on shipping traffic through the Strait of Hormuz since early March, with vessels now required to obtain permission from Tehran to pass or risk being targeted in attacks.

The blockade was imposed following US and Israeli strikes that killed Iranian Supreme Leader Ayatollah Ali Khamenei along with several senior Iranian officials.

The Strait of Hormuz is considered one of the most critical chokepoints in the global oil market, with around 20% of global supplies passing through it before the outbreak of the war.

The Iranian blockade has sharply reduced oil exports from the Middle East, triggering the largest supply disruption in history.

The United States responded by imposing a blockade on Iranian ports and vessels. Trump said on Sunday that the US blockade would remain “fully in effect until an agreement is reached, ratified, and signed.”

Silver prices jumped more than 4% in European trading on Monday, resuming gains that were temporarily halted in the previous session and moving toward recording their highest level in several weeks, supported by the decline of the US dollar and falling global oil prices, following major progress in peace negotiations between the United States and Iran.

Lower oil prices are helping ease concerns over accelerating inflation, potentially giving the Federal Reserve more room to keep interest rates unchanged in the near term, while expectations continue to grow for eventual rate cuts over the longer term.

Price Overview

Silver prices today rose by 4.35% to $78.83, from the opening level at $75.55, while recording a session low at $75.54.

At Friday’s settlement, silver prices lost 1.5%, marking their first decline in the past three sessions, due to a stronger dollar and rising oil prices.

Silver prices also declined 0.55% last week, recording a second consecutive weekly loss, amid mounting inflationary pressures in the United States and rising US Treasury yields.

US Dollar

The US Dollar Index fell 0.4% on Monday, pulling away from a six-week high at 99.52 points and heading toward its first loss in three sessions, reflecting broad weakness in the US currency against a basket of global currencies.

Beyond profit-taking activity, the dollar weakened amid improving risk appetite across global markets, driven by growing hopes that the United States and Iran are nearing a peace agreement that could end the war in the Middle East.

Global Oil Prices

Oil prices fell more than 6% at the start of the week, reaching their lowest levels in three weeks, as fears over supply disruptions from the Gulf region eased, while expectations increased that the Strait of Hormuz could soon reopen to oil tankers.

Developments in the Iran War

The United States and Iran are reportedly close to reaching a final agreement framework to end the war in the Middle East.

Trump stated that a large portion of the draft agreement “has already been negotiated,” though it has not yet been fully finalized, adding that “time is on Washington’s side” to secure a “good and appropriate” deal.

Sources said the agreement framework includes extending the ceasefire for 60 days, giving negotiators time to draft the final and detailed terms needed to permanently end the war.

The agreement also reportedly includes reopening the Strait of Hormuz, alongside a US decision to end its naval blockade on Iranian ports and allow Iran to sell oil under specific exemptions.

Sources added that several contentious issues remain unresolved, including oversight of the Strait of Hormuz, Iran’s complete abandonment of highly enriched uranium, and the release of frozen Iranian assets.

US officials said the agreement will not be signed on Monday and that final approvals could still take several days.

Tasnim News Agency warned that the draft agreement could collapse over disputes related to frozen Iranian assets.

US Interest Rates

Kevin Warsh was sworn in as Chairman of the US Federal Reserve on Friday.

According to the CME FedWatch Tool, markets are currently pricing in a 52% probability of a Federal Reserve interest rate hike in December, compared to just over 16% at the beginning of May.

Markets are also fully pricing in a 100% probability that US interest rates will remain unchanged at the June meeting, while the probability of a 25 basis point rate cut remains at zero.

To reassess those expectations, investors are closely monitoring additional US economic data releases, alongside comments from Federal Reserve officials.