Tehran put military hardware on public display Tuesday as a U.S.-imposed ceasefire deadline ticked toward expiration. Then President Trump blinked on the deadline — announcing he would extend the ceasefire "until such time as their leaders and representatives can come up with a unified proposal," reversing his earlier position that the date would hold.
Large crowds attended the parade in the Iranian capital, videos showed, as diplomats and markets watched to see whether the war would resume or talks would advance. Iran had signaled it had no plans to attend a new round of negotiations in Pakistan this week. Trump said earlier Tuesday he expected to "end up with a great deal" and argued Tehran had "no choice" but to negotiate. If talks do resume in Islamabad, Vance is expected to lead the American delegation.
Trump has also kept the Strait of Hormuz blockaded as leverage. In a post on Truth Social, he wrote that Iran doesn't actually want the waterway closed but is demanding it to save face. "If we do that, there can never be a Deal with Iran, unless we blow up the rest of their Country, their leaders included!" he wrote. Around a fifth of the world's crude oil and liquified natural gas normally passes through the strait, and its effective closure has sent shockwaves through global supply chains.
The economic fallout is widening in unexpected directions. The boss of Karex, the Malaysia-based firm that produces more than five billion condoms a year and supplies brands including Durex and Trojan, told Reuters and Bloomberg that the company plans to raise prices by up to 30% or more. Karex relies on ammonia to preserve latex and silicone-based lubricants — both derived from oil. Demand for condoms has also risen about 30% this year, compounding the pressure. CEO Goh Miah Kiat told Bloomberg: "In bad times, the need to use condoms is even more because you're uncertain with your future, whether you'd still have a job next year."
The disruption extends further. Air fares are running 24% higher on average than a year ago, according to new research. Helium shortages are affecting computer chip manufacturing. Fertilizer prices are climbing. The United Nations has warned that sugar, dairy, and fruit prices will rise due to transport costs. The UAE, which exports some oil through a pipeline bypassing the strait, issued a statement Wednesday distancing itself from any suggestion it needs outside financial support after Trump mentioned a possible currency swap with the country. The UAE said it holds more than $300 billion in foreign currency reserves and approximately $1.5 trillion in banking deposits. A second round of Israel-Lebanon talks is also scheduled for Thursday at the State Department in Washington, with Secretary of State Marco Rubio expected to participate.
