US Seeks to Salvage Iran Deal as Israel-Lebanon Clashes Rattle Oil Markets

President Donald Trump said late June 1 the U.S. could reach an interim nuclear accord with Iran within a week, aiming to prevent Israel’s intensifying Lebanon offensive from derailing talks. Brent crude steadied near $94.90 a barrel on June 2, after surging alongside government bond yields when Iran threatened to tighten controls on the Strait of Hormuz—a choke point for global oil shipments—and close the Bab el-Mandeb strait. Trump reportedly pressed Israeli Prime Minister Benjamin Netanyahu to de-escalate, with both sides agreeing to halt strikes on certain targets, though fighting continued. Iran has conditioned any memorandum of understanding on a Lebanon ceasefire. The potential deal includes reopening the Hormuz Strait for tankers, reversing a U.S. blockade, and freeing frozen Iranian funds. Key hurdles remain, including Iran’s uranium enrichment levels and maritime security guarantees. The oil market has shed 8% in the past 10 days on hopes of a deal, but uncertainty persists as hawkish U.S. lawmakers warn against concessions to Tehran.