Pakistan remains primary interlocutor: Rubio

DUBAI:

The United States has seen some progress towards a deal with Iran but more work is required, Secretary of State Marco Rubio said on Friday, while Iran's foreign ministry spokesman said the two sides' differences were deep and significant.

He reiterated that Pakistan remained the "primary interlocutor" in Washington's negotiations with Iran aimed at ending the ongoing conflict.

"The primary interlocutor on this has been Pakistan and continues to be and they've done a, you know, I think an admirable job. And that's what we continue to work through," Rubio told reporters in Sweden after meetings with NATO allies.

"Obviously, other countries, you know, have interests because especially Gulf countries that are, you know, in the middle of all this, may have their own situation going on. We talk to all of them. But I would just say that the primary country we've been working with on all of this is Pakistan, and that remains the case," he said.

While some gaps have been narrowed, there are still sticking points over Iran's enriched uranium and control over the Strait of Hormuz, whose closure since the start of the war has triggered a global energy crisis.

"There's been some progress. I wouldn't exaggerate it. I wouldn't diminish it," Rubio told reporters after a meeting of NATO ministers in Helsingborg in Sweden. "There's more work to be done. We're not there yet. I hope we get there."

Rubio reiterated comments made on Thursday that Iran's plans for a tolling system for the strait through which a fifth of the world's oil and liquefied natural gas flows were "unacceptable".

"We're dealing with a very difficult group of people, and if it doesn't change, then the president's been clear he has other options," Rubio said.

He also said the U.S. had not asked the NATO military alliance for help on the Strait of Hormuz but that there needed to be a Plan B if Iran refuses to reopen the waterway.

Despite the intensifying mediation efforts, Iran's foreign ministry spokesman, Esmaeil Baghaei, was quoted by IRNA news agency as saying diplomacy takes time and suggesting that the sides had not reached a point where an agreement was close.

He said nuclear issues were not being discussed and that a conclusion would not be reached if the U.S. sought to delve into details about highly enriched uranium in Iran.

The US and Israel say their war aims are to curb Iran's support for regional militias, dismantle its nuclear program, destroy its missile capabilities and make it easier for Iranians to topple their rulers.

But Iran has so far retained its stockpile of near-weapons-grade enriched uranium, and its ability to threaten neighbours with missiles, drones and proxy militias.

After US-Israeli airstrikes began on February 28, Iran fired at Gulf States that host U.S. military bases and the war reignited conflict between Israel and militant group Hezbollah in Lebanon. Thousands have been killed in Iran and Lebanon.

The war has also created turmoil in the global economy, with the surge in oil prices stoking fears of rampant inflation.

Major stock indexes rose on Friday, with the blue-chip Dow hitting a record high, but Treasury yields dipped as investors weighed the likelihood of a near-term deal to end the war.

The US dollar was near its highest level in six weeks on Friday amid the uncertainty over peace talks, while oil prices climbed.

US President Donald Trump said the US would eventually recover Iran's stockpile of highly enriched uranium - which Washington believes is destined for a nuclear weapon, though Tehran says it is intended purely for peaceful purposes.

Two senior Iranian sources told Reuters before Trump's comments that Iranian Supreme Leader Ayatollah Mojtaba Khamenei had issued a directive that the uranium should not be sent abroad.

Trump faces domestic pressure ahead of November midterm elections, with Americans angry over the surge in fuel prices and his approval rating near its lowest level since he returned to the White House last year.

Tehran submitted its latest offer to the US earlier this week.

Iran's descriptions suggest it largely repeats terms Trump previously rejected, including demands for control of the Strait of Hormuz, compensation for war damage, lifting of sanctions, release of frozen assets and the withdrawal of US troops.

(With input from News Desk)