[Today’s Iran war post yet again went live before done. Please return at 8:00 AM EDT or refresh this page then for a final version]
In Senate testimony on Tuesday, State Department Secretary Marco Rubio set forth US demands to Iran. Despite claims that the two sides were making progress. the Rubio remarks show that the US is not registering the repeated “What about ‘no’ don’t you understand?” that Iran has made in reply. Rubio also replayed tired tropes, such as Iran needs to be forced to come to the table (as if they have not been? And by what means?). From what I could tell, most of the Senators had developed their questions before the meeting. I did not seem much evidence of them incorporating Iran’s new demands, of a ceasefire on all fronts, with that now to include Gaza and the West Bank, was considering closing the Strait of Hormuz and the Bab el-Nandab happened, and would not “talk” further.
But of course Trump lied shamelessly yet again said “talks” were still underway:1
Trump needs an editor in additions to other minders. “Continuously” is not possible unless the US and Iran are running 24/7 shifts.
Iran begged to differ with the Trump characterization:
An informed source told Fars that Iran–US message exchanges have stopped for several days, despite Trump saying talks are moving quickly.
The source says Iran’s last message to Washington was about Lebanon.
— Arya Yadeghaar (Backup) (@AryJeayBackup) June 2, 2026
IRAN SAYS U.S. MESSAGE EXCHANGE HALTED
An Iranian source says there is currently no message exchange with the U.S., contradicting claims of ongoing progress. The source reports talks on an initial understanding have stalled for several days. It also noted Iran’s last…
— *Walter Bloomberg (@DeItaone) June 2, 2026
Everything that has happened since Iran threw down its new markers confirms the wisdom of its hardline stance. Even though Trump quickly called Netanyahu and we are told by the White-House-stenographer-in-chief Barak Ravid, gave him the mother-of-all-chewings-out, all Netanyahu has done is hold back from bombing Beirut. Operations continue in Southern Lebanon and one assumes Gaza and the West Bank. As we will soon show, Rubio’s testimony plus a new US attack show that the Administration is not budging even though its current position is not tenable. Perhaps Trump can keep saying sweet nothings to Mr. Market and keep energy prices tamped down for weeks longer. But that simple assures that the price break will be more dramatic when inventories finally reach rock bottom. Sadly, given the inability to remove Trump from power any time soon, the odds favor that he will try to keep up the pretense that he can turn the tide even as it rises up to his ears and sinks big sections of the US and global economy.
And these bad outcomes are not just due to Trump having white matter disease but also of having been a lousy negotiator even in his prime. From Eugene Linden in comments:
I can vouch for Mikew0’s analysis that Trump goes into negotiations with no strategy whatsoever. For 15 years I was chief investment strategist for a family of distress investment hedge funds. A few years before I arrived, the main fund bought a good deal of severely discounted debt in Trump’s Jersey casino. The head of the fund and a bunch of other heavyweight distress investors went to a meeting at Trump tower to discuss the future. The president of the Trump organization came in to the room and said something like, “If you don’t accept our terms, we’re going to declare bankruptcy!” The bankruptcy pros looked at each other and then said, “Great, then we own the company.” The president looked no-plussed and left the room. When he came back (clearly after conferring again with Trump) he said, “If you don’t accept our terms, we’re going to keep paying the coupon!” Again, the pros nearly laughed, and said, “Great, then our debt is money good — and by the way, we don’t accept your terms.”
Yes, sports fans, Trump has long been so arrogant that he negotiated over a potential bankruptcy without apparently talking to a bankruptcy lawyer….and persisted even after a “put foot in mouth and chew” incident in an initial round.
First to the sightings of toads hopping from Rubio’s mouth. A new Daniel Davis discussion with Douglas Macgregor helpfully hoisted the core part from Rubio’s opening statement. Keep in mind that Rubio is on deck for a second day in the hot seat on Wednesday:
From a lightly cleaned-up machine transcript:
Secretary Rubio [from recording in the Senate]: If Iran wants to be able to move its oil again through the Strait, they will have to reopen the straits. If they refuse to do so, then we have other options available to us, but we would prefer to negotiate the opening of this.
Senator Murphy: What do you need from them in order to get the straight reopened? We need the Strait reopened tomorrow.
Rubio: Well, what needs to happen is very simple. We’re not charging a toll. We will help remove the mines that they put in there and they will not fire on ships.
Murphy: But the president says they also need to make commitments on their nuclear program. That’s what I’m asking.
Rubio: That’s the predicate that opens the door to phase two. Phase two is they have to commit to very specific negotiations on disposition of the highly-enriched uranium that still is buried deep in a mountain somewhere. They have to agree on negotiating severe and long-term limitations and or cancellation of enrichment activity in their ..
Murphy: in the second phase of negotiations.
Rubio: Obviously, these are highly technical matters. So, I don’t think you could work those out in 5 days. You that would require a team of experts to meet over a 30 60 90 day period and work out the details. But they have to commit to their willingness to do that. For example, they have to commit to say we will dispose of the enriched uranium. And the question now is what are the mechanisms by which we do so
Murphy: On order to get to that second phase, are you willing to release sanctions or release frozen money that the United States is withholding from Iran?
Rubio: Right now everything that’s been discussed with them is that any sanctions relief, now remember sanctions, ’cause there’s international sanctions, there’s congressional sanctions, there’s executive sanctions. So some we can release and some we cannot.
But any sanctions relief is condition-based which means it has to be in return for the reason why those sanctions were put in place in the first place which is their nuclear program. So yeah look Iran is being sanctioned because they enrich uranium. Iran is being sanctioned because they’ve highlyenriched uranium. Iran is being sanctioned because of their nuclear activities.
Murphy: If they agree to give up those things, there will be sanctions relief associated with their commitment and compliance with those agreements relief just in exchange for reopening the Strait
Rubio: No, that that’s not been discussed. That’s not been offered.
If you have followed what Iran has been saying about its requirements for ending the conflict, the Trump Team continuing to broadcast its fantasies is maddening. Iran has very clearly said it does not trust the US at all and the US must take concrete action first, with Iran pushing hard for that to be the release of some of its frozen assets (the most commonly reported figure is $12 billion). That is the price of entry. No tickie, no laundry.
So Iran is correct to pack its tent and wait until the US gets over its sense of imperial entitlement.
Now it is possible that Iran might entertain a concrete US measure in place of the release of blocked funds, but there is no indication that such an idea has been broached.
Let us continue with the Rubio lunacy for the sake of completeness. On enrichment, Iran has continued to insist on sequencing, that it will not talk about its uranium program at all until Phase 1 negotiations are completed, which means what to do about the Strait of Hormuz, how to end the conflict on all front, and per Iran, the exit (or considerable downsizing) of US military from the region.
If you review what Rubio said above, the US still thinks it can get Iran to make high-level Phase 2 commitments before starting Phase 2. Huh? This is “Sentence first, verdict afterwards.”
And in a further show of cheekiness, Rubio is going well beyond the state of play before Iran pulled the plug, like insisting that get rid of its highly-enriched uranium. Contrast the remarks above with:
🚨🇮🇷🇺🇸 Iran-US talks: enriched uranium is not currently on the table
Removing enriched uranium from Iran is not being discussed in the ongoing negotiations, Ebrahim Azizi, head of the Iranian Parliament’s National Security and Foreign Policy Committee, told Sputnik. pic.twitter.com/HbTbxHgLZz
— Sputnik India (@Sputnik_India) May 30, 2026
🚨 BREAKING
🇮🇷 IRAN SAYS ANY “TRANSFER” OR “DISPOSAL” OF ITS ENRICHED URANIUM IS NOT INCLUDED IN THE CURRENT U.S. DRAFT AGREEMENT
THE COMMENT HIGHLIGHTS THAT THE NUCLEAR ISSUE REMAINS ONE OF THE BIGGEST OBSTACLES IN THE ONGOING TALKS
THIS IS NOT GOOD FOR THE MARKETS pic.twitter.com/tawdo8AIj6
— ardizor 🧙♂️ (@ardizor) June 1, 2026
Iran had seemed willing to be a bit flexible and have it diluted well below weapons-grade level. But it has hardened its position and is not willing to have it leave Iran, as the US still insists.
On top of that, the US has retraded its position, since Rubio’s statements to Congress have official weight. That is yet more proof to Iran that the US is a hopeless bad faith actor.
And as for the Strait of Hormuz, Iran has been consistent that it is not giving up its control, although Iran has not done itself favors by saying the Strait has been or will be “open”. What Iran means by “open” is in a different universe from what the US is demanding, which is a return to status quo ante. Iran has been remiss in not clarifying what it means. Admittedly, it been passing legislation, which does not seem to be a speedy process, and some of its procedures will likely depend on what if anything Oman is willing to do. As we will soon discuss, the US has been threatening Oman bigly.
Colonel Macgregor, in the same video segment, sums up the sorry state of affairs:
Host: Doug, haven’t we been here already? How many times can Iran say, “No, we’re not going to do that. No, we’re not going to do that.” And yet they keep circling back like this and he just capitlaized everything that we’re looking at the impossible.
Macgregor: :Well, he’s done an excellent job of once again restating Mr. Netanyahu’s policy positions because that’s essentially what we’ve adopted and that’s what we’re saying. Uh, none of this is original and there is no negotiation.
All we’ve ever done is restate over and over and over again what Mr. Netanyahu says he must have. And whenever there’s a a possibility that there could be some modification that would lead to any kind of breakthrough, Mr. Netanyahu gets on the phone and makes it clear to Donald Trump that that’s unacceptable. And Donald Trump says, “Yes, sir. Roger. Got it.” And goes back to work again to realize Israel’s goals.
There was a good deal of derisive commentary on Twitter about Rubio’s testimony, particularly his bizarre claim that the war was over. A samplings:
If the war on Iran was over, as Rubio testified to under oath today, WHY is the U.S. dropping bombs on Qeshm Island, forcing retaliatory strikes from Iran on U.S. bases in Kuwait and Bahrain?
There’s no exit strategy.
All they do is LIE.pic.twitter.com/6UND9wg6GA— BrooklynDad_Defiant!☮️ (@mmpadellan) June 3, 2026
Marco Rubio says it’s unclear how or when the Strait of Hormuz will open.
— Spencer Hakimian (@SpencerHakimian) June 2, 2026
A fresh statement from Iran, posted in the Aljazeera live feed, underscores that Iran will not bend to US pressure:
Iran will not allow US to overreach in negotiations, senior official warns
Iran will not allow the US to overreach in negotiations or the ceasefire process, a senior Iranian official says.
“The response to every shot and aggression will be a barrage of missiles and drones,” Mohsen Rezaee, a member of the Expediency Discernment Council and former IRGC commander, said in a post on X. “History will not turn back, and the aggressor will be swiftly punished.”
“Neither in negotiations nor in the ceasefire process will we allow America to overreach,” Rezaee added.
That brings us to the kinetic front, which heated up this week and may get hotter. From Bloomberg in US, Iran Exchange Military Strikes to Put Fresh Strains on Ceasefire:
The US and Iran clashed again overnight, with Kuwait and Bahrain caught in the crossfire of one the most serious flare-ups since a ceasefire went into effect in early April…
Shortly after “disabling” an empty oil tanker heading to Iran, the US military said it came under missile and drone attack.
Iran targeted the US’s main naval base in the region, located in Bahrain, and the Ali Al-Salem airbase in Kuwait. At least one person at Kuwait’s civilian airport was killed in a separate strike.
The US said Iran fired several ballistic missiles at its allies Bahrain and Kuwait, with all “failing to hit their intended target,” as well as drones at commercial ships. American forces struck a communications tower on the Iranian island of Qeshm near the strait as part of the skirmishes.
Kuwait said its airport was significantly damaged and it suspended flights for a few hours. A number of people were injured in addition to the person who was killed, it said.
It is painful to read Bloomberg repeating patently bogus US spin. One howler was “The US military said its strikes on Iran were all in self-defense.” This is narrowly accurate although substantively misleading. Pray tell how can shelling an empty and unarmed oil tanker ever be an act of self defense?
And consider this market-stoking falsehood:
The sides have agreed on a rough framework that should extend their truce by two months and reopen the Strait of Hormuz, though negotiations over the final details are dragging on.
Iran has NOT agreed to anything. Iran’s clear and consistent position has been that nothing is agreed until everything is agreed.
Larry Johnson weighted in on the latest exchange of strikes in Iran and the US Trade More Blows in the Persian Gulf:
The tensions between the US and Iran remain very taut after both sides exchanged of fire late on June 2 (early morning June 3 in the Persian Gulf). It apparently started when a US helicopter tried to stop an Iranian tanker headed for the port of Bandar Abbas. The US helo launched a hellfire missile that reportedly hit the engine room and disabled the tanker. In addition, the US also hit an Iranian communications tower on Qeshm Island.
Iran wasted no time responding… the IRGC released the following statement:
Late last night, the invading US military targeted an Iranian oil tanker near the Strait of Hormuz with a hellfire missile, damaging the engine room.
In response to this aggression and violation of the regulations of the Strait of Hormuz, the IRGC targeted an enemy Zionist-American ship, the ‘Panaya’, with missiles.
In a renewed aggression, the American enemy also targeted an IRGC communications on Qeshm Island.
In response to this aggression, its airbase and its helicopter base stationed in one of the countries in the region (Kuwait), as well as the headquarters of the US Fifth Fleet in Bahrain, were subjected to an attack by missiles and drones of the IRGC Aerospace Force.
We warned previously that in the event of aggression, the response would be different and harsher, and we have acted accordingly. These responses should serve as a lesson.
We reaffirm that undermining the security of the Strait of Hormuz will cost the invading U.S. military a heavy price.’
While CENTCOM claimed that US forces shot down all Iranian missiles, video footage from Kuwait tells a different story, with at least three visible missile impacts on the ground. There is no news of casualties.
This WION segment contains some of the sort of images that Johnson mentioned:
NO! warns of escalation:
Iran–US ceasefire collapses into direct kinetic exchange. US struck Qeshm Island and Hellfired an oil tanker’s engine room; Iran retaliated with ≥10 ballistic missiles and Shahed drones on US Ali Al-Salem Airbase and Camp Arifjan in Kuwait, plus the 5th Fleet HQ in Bahrain (AMK Mapping overnight summary, Drop Site on the Kuwait strikes). Kuwait International Airport’s Terminal 1 was “heavily damaged,” flights suspended (Kuwait MoD via BRICS, damage confirmation). Bahrain claims it downed 3 missiles (AMK)…..
Iran’s new doctrine: retaliate “at least 1.5x as hard,” immediately. Tit-for-tat is over per an Iranian source (Trita Parsi); the escalation ladder ran Qeshm → Kuwait → Qeshm → Kuwait within hours (Nostra sequence).
Simplicius in US Wallows in “Stalemate” Purgatory of Its Own Making keys off a New York Times article, Trump Hits the Stalemate Phase of His International Interventions, and It Stings. Simplicius provided a tidbit I had missed:
Several days ago Iran targeted US bases in Kuwait after the US struck Iranian radar positions on Qeshm island. Immediately after the strikes came news that a British and US soldier died mysteriously during training “accidents”.
Now to the US putting the thumbscrews on Oman, as recounted by the Wall Street Journal in U.S. Presses Neutral Oman to Pick a Side and Cut Ties With Iran:
At the start of the U.S.-Iran war, officials in Oman raced to establish a back channel with Tehran…
Three months later, that neutral stance is beginning to backfire. Washington increasingly interprets Oman’s approach toward Tehran as hostile to America and, according to U.S. and Arab officials, has pressed Oman to pick a side and cut diplomatic ties with Iran.
In recent days, the Trump administration has threatened to sanction and even bomb Oman, after a new intelligence assessment concluded that Muscat was planning to join Iran in tolling vessels in the strategic Strait of Hormuz, according to another U.S. official. Oman has repeatedly denied that it plans to do so…
Oman, which has acted as a mediator in previous rounds of nuclear talks between Washington and Tehran, didn’t condemn Iran by name after attacks on traffic through the strait and missile and drone strikes across the region. A person familiar with the matter said not doing so was in line with Omani diplomatic tradition.
When war broke out, Oman’s foreign minister, Badr Albusaidi, told Omani media that the conflict was weakening the region and suggested Gulf Arab states reconsider their security ties with the U.S….
Omani territory was used to provide some logistical supplies to the U.S. military at the start of the war, say Arab and U.S. officials. But the U.S. official said the military assistance was small…
Omani officials have been shocked by the sudden U.S. hostility and are working to figure out how to respond to it, Arab officials said….
Since the war started, Oman has assisted ships, including from the U.S., by providing navigational guidance, search-and-rescue services and medical assistance to ship crews, said a person familiar with the matter.
Harrasi said the country remained committed to the free flow of commerce and energy through the strait. “Any threat to freedom of navigation in these waters would harm the interests of the entire international community, including the United States,” he said…
U.S. officials said the genesis of the Trump administration’s distrust of Muscat came a day before the first U.S.-Israeli airstrikes when Oman’s foreign minister appeared on U.S. television to claim an agreement on nuclear issues to avoid a conflict was “within our reach, if we just allow diplomacy the space it needs to get there.”
No agreement was that close, the officials said, noting Iran hadn’t made a serious offer to limit its nuclear work.
Since then, the Trump administration has tried to sideline Oman in any diplomatic process, though there is no genuine plan to attack the country for its support of Iran, the U.S. officials said, despite Trump’s remark at last week’s cabinet meeting…
Muscat has incensed the U.A.E. and Saudi Arabia by systematically refusing to sign on to joint statements from the U.S. and regional countries condemning Iran’s attacks, Arab officials say. When Iranian drones hit Oman’s own ports, Oman acknowledged the event but didn’t call out Tehran as responsible…
Today, Oman isn’t directly criticizing Iran’s toll demand because Muscat sees it as just another negotiating tool, especially to secure the release of billions of dollars in funds frozen by U.S. and international sanctions, one of the officials said.
Keep in mind that others depicted as knowledgeable about the pre-war negotiations have said that Iran was making very significant concessions. The restrictions it agreed to were even tighter than those in the JCOPA, allowing Trump to claim a win. But the insiders say Kushner and Witkoff were either so far out of their depth as to not understand what Iran was prepared to give, or too committed to war with Iran to present it to Trump honestly.
And some economic front tidbits, first a major wake up call from Bloomberg in Dollar General Says Pinched Consumers Are Cutting Back on Food<./a> Keep in mind that the impact of diesel price increases and fertilizer shortages have barely begun to register:
Some Dollar General Corp. shoppers are cutting back on food and other household expenses due to rising gas prices, Chief Executive Officer Todd Vasos said on the company’s earnings call.
“Our core customer continues to be financially constrained,” Vasos told analysts on Tuesday. “This pressure has been more pronounced on customers in rural communities, as they work to minimize trip distance and make trade-offs in their search for everyday affordability and value.”
Food companies have previously said that consumers are seeking bargains or buying products on sale, but they largely stopped short of saying shoppers were purchasing less food.
Changes to the Supplemental Nutrition Assistance Program, or SNAP, have been another headwind for Dollar General’s core customer base, Vasos said. Republicans last year expanded work requirements for people receiving SNAP benefits, which has pushed people out of the program.
The retailer responded by adding more $1 private-label items during the quarter and expanding its slate of $1 frozen items. That helped bring more shoppers into stores.
Next, a meaty tweet that makes a key point: “You are no longer watching an oil market. You are watching a market that trades the odds of a peace deal and prints the answer on an oil ticker.”
Oil spiked as much as eight percent, then started giving it back within hours.
Not one barrel of supply changed in between.
What moved the price was two sentences, and that is the entire story.
The first sentence came from Tehran: Iran was suspending talks with Washington and… pic.twitter.com/4ysonRKXp2
— Shanaka Anslem Perera ⚡ (@shanaka86) June 2, 2026
And apropos the coming oil supply/price cliff, a point that seems still not to have sunk in:
This is the most robust chart in all of economics, and it shows that GDP has a near-perfect correlation to oil consumption. If a shortage of oil goes on for too long, then the economy will be forced into retreat to match the amount of oil that’s available. It’s that simple.
Full… pic.twitter.com/uHkGHdysQI
— Chris Martenson (@chrismartenson) June 2, 2026
And confirming that we are not crazy in seeing bizarre and widespread denialism, particularly among those who hold themselves out as professionals:
Every physical trader I spoke to in the last month said something along the lines of, “Prices will stop us from hitting tank bottom.”
Fast forwarding to today, nope. Market did not price in any demand destruction in the West. Instead, we are just going full on into shortage…
— HFI Research (@HFI_Research) May 29, 2026
Done for today! See you tomorrow!
____
1 The tweet time is 1:00 PM EDT on June 2.
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