US-Iran Peace Deal Nears Completion Amid Fresh Strikes as Trump Demands Arab Recognition of Israel

Kuala Lumpur — The United States and Iran are reportedly close to finalizing a major peace agreement to end months of direct conflict, even as American forces carried out new limited strikes on Iranian targets this week. At the same time, President Donald Trump has linked the deal to a broader regional demand: Arab nations must normalize relations with Israel.

According to sources familiar with the negotiations, a Memorandum of Understanding (MoU) is “largely negotiated,” with key provisions including the reopening of the Strait of Hormuz, a moratorium on uranium enrichment by Iran, and discussions on sanctions relief. Mediators from Qatar and Pakistan have been actively involved in the talks.

However, tensions remain high. On May 25 and 26, U.S. Central Command (CENTCOM) conducted precision strikes on missile sites and vessels in southern Iran, which the Pentagon described as “defensive actions” to prevent Iran from mining the Strait of Hormuz. Iran condemned the attacks as a violation of the existing ceasefire and accused Washington of negotiating in bad faith.

Despite the fresh military exchanges, both sides have stated that the broader ceasefire — first agreed in April — remains officially in effect while diplomatic efforts continue.

Trump Ties Iran Deal to Abraham Accords Expansion

In a significant development, President Trump has explicitly told several Arab leaders that their participation in any new regional security and economic framework must include formal recognition of Israel.

During phone calls over the past weekend with leaders from Saudi Arabia, the United Arab Emirates, Qatar, Egypt, Jordan, Bahrain, and others, Trump reportedly described normalization with Israel as “mandatory.” He is pushing for an expanded version of the Abraham Accords to be signed simultaneously with any final Iran agreement.

“Peace with Iran is good, but real regional peace requires everyone to accept Israel’s right to exist,” a senior White House official was quoted as saying.

Several Arab states, particularly Saudi Arabia, have expressed surprise at the firmness of Trump’s position and continue to insist that progress on the Palestinian issue must be part of any normalization deal.

Fragile Path Forward

Analysts warn that the situation remains extremely delicate. While both Washington and Tehran appear motivated to reach a deal — Iran to escape economic pressure and the U.S. to stabilize energy markets — recent strikes have eroded trust.

Iranian officials said the latest U.S. attacks “complicate” the negotiations, while the Islamic Revolutionary Guard Corps (IRGC) vowed a strong response if provocations continue.

President Trump, speaking to reporters on Wednesday, struck an optimistic yet firm tone: “They want the deal very badly. We’re very close. But if it doesn’t happen, we will solve it another way.”

Oil prices rose slightly on Thursday amid uncertainty, while regional markets closely monitor developments in Doha, where the next round of indirect talks is expected this week.

This unfolding story combines high-stakes diplomacy, military pressure, and a bold push for a new Middle East order — one in which Arab-Israeli normalization is no longer optional in Washington’s eyes.