Oil Rebounds After Iranian Denial: Will Never Give Up Nuclear Program; US Official Rejects Reports Of Lifting Sanctions For Talks

Summary

US denies earlier Tasnim report of agreeing to lift oil sanctions during talks.
Trump calls for Iran's total military surrender in Monday morning Truth Social post.
Oil rebounds on Tasnim reporting Iranian denial: Tehran "under no circumstances" will negotiate nuclear issue as part of an end to the war.
A flurry of (the somewhat typically-timed) Monday opener headlines have pushed oil prices lower, erasing weekend gains, including Al Arabia reporting that Iran is ready to accept a long-term nuclear freeze, instead of full dismantling.
Iran has submitted its latest proposal comprising 14-points through Pakistan, amid reports that the US has offered to lift sanctions on Iranian oil during the interim negotiating period.
Reports further add that Russia's offer to take and hold Iran's enriched uranium stockpile on its territory is being taken seriously.

US obtains Iranian enriched uranium by December 31?
Yes 26% · No 75%
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US Denies Tasnim Report It Agreed to Lift Iran Oil Sanctions

And the denials keep rolling in. First via CNBC:

A U.S. official tells me the Iranian state media report that the U.S. has agreed to lift oil sanctions while talks are ongoing is false. https://t.co/gOcyBKDAxC
— Megan Cassella (@mmcassella) May 18, 2026

...as the US side does not seem very confidently in control of the situation - quite the opposite:

Senior U.S. official: "It's time for the Iranians to throw bit of candy out. We need some real, sturdy, and granular conversation [regarding the nuclear program]. If that's not gonna happen, we will have a conversation through bombs, which will be a shame" https://t.co/qTNrY1fgoN
— Barak Ravid (@BarakRavid) May 18, 2026

Just like that, back to square zero once again we go... and back to headline roulette.

US PLANS NEW RUSSIAN OIL WAIVER AS IRAN WAR CRUNCHES SUPPLIES
US DENIES REPORT IT AGREED TO LIFT IRAN OIL SANCTIONS: CNBC

Steady climb in oil continues on the denials...

Trump Monday Morning Truth Social 'Threat'

Like clockwork, the start of the week threat from Trump on TS... same as the old threats:

And bearish news via Axios:

Iran has given an updated proposal for a deal to end the war, but the White House believes it is not a meaningful improvement and is insufficient for a deal, a senior U.S. official and a source briefed on the issue told Axios.

Oil Quickly Rebounding on Iranian Denial

In a far too familiar pattern, just before US market open on Monday, a slew of optimistic Iran headlines saw oil erase weekend gains, which mostly came through Saudi Arabia's state-funded Al Arabiya, as well as Reuters... only to be followed by Iranian officials rejecting the substance of these reports, putting things firmly back at square one.

Tasnim has newly cited Iranian government sources who seek to make clear that "Iran under no circumstances" will engage in new nuclear negotiations for an end to the war. Contradicting the earlier morning reports, it still sees negotiations to find peace in the war with the US as separate from the nuclear file. "Fundamental differences between the Iranian and American texts still remain", Tasnim reports, citing a source.

"Despite some changes in the new American text, fundamental differences stemming from the Americans' exaggeration and lack of realism remain," Tasnim writes, citing the Iranian source. According to more of the statements per state media:

"Iran will not abandon its firm and principled positions on ending the war and realizing the rights of the Iranian people".
"Iran's frozen assets must be returned to the Iranian people in a transparent and definitive manner, and paper promises are of no use".
"Despite some promises, there is disagreement about the return of the frozen funds".
"Iran's determination regarding the necessity of paying compensation by the Americans for the military aggression against Iran is very serious".
"The Americans are far from Iran's demands regarding its amount and some other issues."
"the Americans are still trying to tie the negotiations to end the war to the nuclear issue, which is against logic and Iran will not agree to it. The Americans must understand that Iran will in no way agree to an end to the war in return for nuclear commitments".
"Iran has not and does not have any intention of building nuclear weapons, and this claim is just an excuse and deception by the Americans. This issue has also been emphasized in the new text".

Oil reacted as expected to this official 'denial' of the prior optimism - quickly rebounding, also as Trump is said to be "losing patience" with the progress of talks. A US source has told Al Jazeera Iran has "days not weeks" to show progress.

The optimism and then denials happened within a span of a couple hours...

And here is the walkback, as IRGC must have just gotten the memo:

DESPITE SOME CHANGES IN THE NEW AMERICAN TEXT, FUNDAMENTAL DIFFERENCES STEMMING FROM THE AMERICANS' EXAGGERATION AND LACK OF REALISM REMAIN https://t.co/3KT4OeLhCq
— zerohedge (@zerohedge) May 18, 2026

Tasnim: Another Iranian Ship Breaks Through US Blockade Line

Iranian state media is claiming that a Iranian oil tanker under US sanctions that was off the coast of India two weeks ago has now docked at Kharg Island, having broken through the US naval blockade. Tasnim reports that "the LPG tanker passed through the US blockade line undetected and entered Iranian waters."

The Pentagon has been asserting an essentially airtight blockade on 'illicit' ships going to or from Iranian ports. CENTCOM has said it has turned around at least 75 vessels, while Iranian media has since the blockade's start touted several ships making it through.

Long-Term Nuclear Freeze on Table

Saudi state-owned Al Arabiya early Monday has issued a bombshell if true (but still very much not officially confirmed), reporting that Iran has agreed to a long-term nuclear freeze instead of a complete dismantling. The outlet also reports that Iran has withdrawn its demand for compensation, instead demanding economic concessions. However, this could be highly dubious, given over the past several days Tehran has not shown willingness to back down from this demand of compensation.

It also seems Russia's offer to take and temporarily hold Iran's enriched uranium is being taken seriously. Here are the alleged "leaks" of the working draft peace document:

Working on a condition transfer of enriched uranium to Russia instead of the US.
Seeking multiple international guarantees for any agreement.
Wants Pakistan and Oman to have a 'role' in any 'clash' in the Strait of Hormuz.
Seeking a political formation that allows Iran to save face.
Separate the maritime route from nuclear issues.

Oil pushes lower on the additional headlines, following initial reports that the US would lift sanctions on Iranian oil during the negotiating period...

As a reminder from days ago: "US President Donald Trump said Friday that he would accept a 20-year suspension of the uranium enrichment at the heart of Iran’s rogue nuclear program if Tehran gave a “real” guarantee, in an apparent shift from his previous demand that Iran permanently halt its program and his pledge to ensure Iran can never attain nuclear weapons."

US Lifting Oil Sanctions During Negotiation Period: Tasnim

Tasnim news agency says Iran has submitted its latest proposal comprising 14 points through Pakistan. State sources say the focus by Iranian leadership is to end the war and build trust. This as Pakistan’s interior minister has extended his Tehran visit for a third day.

In this context a source close to the negotiating team reportedly told Tasnim that, unlike their previous texts, Washington agreed in the new text to lift Iran's oil sanctions during the negotiation period. This is a first big sign of progress since the White House reportedly sent five 'counter' conditions to Tehran, which only offered a partial sanctions reduction.

Per more from Tasnim:

Waiving sanctions means temporarily lifting sanctions.
Iran insists that lifting all sanctions on Iran should be part of the US's commitments.
However, the US has proposed suspending OFAC until a final understanding is reached.

The headline was enough to push oil down, erasing the gains over the weekend...

Another blurb via TASS, offering a little more in terms of likely conflicting interpretations and expectations:

According to the source, unlike in its previous proposals, the US has agreed in its new offer to suspend oil sanctions against Iran for the duration of the talks. The source noted that Tehran, for its part, insists on the lifting of all sanctions, while Washington is only ready to waive US Treasury sanctions until a final agreement is reached.

More Latest Developments

According to more of the latest headlines via Al Jazeera:

Iran’s Foreign Ministry spokesperson says talks between Iran and the US are continuing through Pakistan.
He added that Iranian and Omani technical teams met in Oman to negotiate a mechanism for ensuring safe transit in the Strait of Hormuz.
Kuwait and Qatar have condemned drone attacks on Saudi Arabia, which officials say originated from Iraqi airspace.
The Israeli army says it struck more than 30 targets in southern Lebanon, which it claims were used by Hezbollah to attack Israeli forces.
The Israeli navy has seized vessels that were part of the Gaza-bound Global Sumud Flotilla, arresting 100 activists on board.

And more developments via Newsquawk:

US President Trump warned on Truth Social that the clock is ticking for Iran and that they better get moving fast, or there won’t be anything left for them, and that time is of the essence.
US President Trump declined to give a specific deadline for negotiations with Iran and will hold a Situation Room meeting with his national security team on Tuesday to discuss possible options for military action, while he spoke with Israeli PM Netanyahu about the situation in Iran, according to Axios. Trump also stated that he still thinks Iran wants a deal and he is waiting for an updated Iranian proposal, which he hopes will be better than the prior offer. Furthermore, Axios’s Ravid reported that Trump threatened that attacks would resume with greater intensity if the Iranian regime does not come up with a better proposal, while Channel 12’s Kraus posted that President Trump said in a phone call that he thinks the Iranians should be afraid of what’s going on right now.
Pakistan shared revised Iranian proposal to end the war with the US on Sunday night, according to Pakistani sources. The course added that "we don't have much time", adding that both countries "keep changing their goalposts".
Western sources say the new Iranian proposal includes a commitment of unclear value not to produce nuclear weapons but no mention of uranium or Hormuz, according to Journalist Segal.
Iranian Foreign Ministry Spokesperson Baghaei said talks with the US continue through Pakistani mediation. The spokesperson added that they have made great efforts for safe movement and protection of the Strait of Hormuz and are in constant contact with Oman to develop a mechanism. On Uranium, Baghaei said Tehran does not need any party to recognize its right to uranium enrichment and will not discuss during negotiations with the US.
Iranian Defence Ministry spokesman Brigadier General Reza Talaei-Nik warned of a regretful response to enemies and said that Iranian armed forces are fully prepared to confront any potential attack by the US and Israeli regime, according to IRNA.
Iranian Major General Rezaei said Iran is serious about diplomacy and negotiations, but is more serious about dealing with the aggressor, while he added that the US must now prove its good intentions and that Iranian armed forces are on the trigger as diplomatic efforts continue.
Iran said transit through the Strait of Hormuz would flow again once its conflict with the US and Israel is over, although the sides remain far from resolving their differences, according to Bloomberg. In relevant news, three cargo-empty, US-sanctioned tankers reportedly slipped through the US naval blockade in recent days, according to TankerTrackers.com.
Israel said it carried out a Gaza strike targeting the de facto head of Hamas's armed wing, while Israel also conducted an airstrike on the towns of Froun, Kfar Hounah and Zawtar al-Sharqiya in southern Lebanon. Furthermore, an Israeli air strike targeted Baalbek, Lebanon and killed an Islamic Jihad commander and his daughter.
UAE officials said a drone attack set off a fire near the UAE’s nuclear power station, while it was still investigating the source of the attack.
Saudi Defence Ministry said it intercepted three drones launched from Iraq after entering the kingdom’s airspace.