WASHINGTON/SINGAPORE —The US military said it will begin a blockade of all maritime traffic entering and exiting Iranian ports and coastal areas on Monday, after weekend talks failed to reach a deal to end the war with Iran, jeopardizing a fragile two-week ceasefire.

The talks in Islamabad, which ran from Saturday into early Sunday, were the first direct US-Iranian meeting in more than a decade and the highest-level discussions since Iran’s 1979 Islamic Revolution. The negotiations came days after a ceasefire began on Tuesday, aimed at ending six weeks of fighting that has killed thousands of people across the Gulf, throttled vital supplies of energy and sparked fears of a wider regional conflict.

The US Central Command said that the US blockade, starting at 10 a.m. ET on Monday (1400 GMT), would be “enforced impartially against vessels of all nations entering or departing Iranian ports and coastal areas, including all Iranian ports on the Arabian Gulf and Gulf of Oman.”

Vessels transiting the Strait of Hormuz to and from non-Iranian ports will not be impeded, the US military said. Additional information would be provided to commercial mariners through a formal notice prior to the start of the blockade, it said.

President Donald J. Trump said on Sunday US forces would also intercept every vessel in international waters that had paid a toll to Iran.

“No one who pays an illegal toll will have safe passage on the high seas,” Mr. Trump wrote on social media, adding: “Any Iranian who fires at us, or at peaceful vessels, will be BLOWN TO HELL!”

He added that the US Navy will begin destroying mines that the Iranians had dropped in the Strait of Hormuz, a chokepoint for about 20% of global energy supplies.

While shipping data showed three supertankers fully laden with oil passed through the Strait on Saturday, tankers were steering clear of the waterway on Monday, ahead of the US blockade.

Benchmark crude oil prices surged more than 7% to top $100 per barrel in Monday morning trade in Asia, while the dollar jumped and US stock futures fell following the blockade announcement.

“Trump wants a quick fix,” said Dana Stroul, a former senior Pentagon official during the Biden administration now at The Washington Institute for Near East Policy. “The reality is, this mission is difficult to execute alone and likely unsustainable over the medium to long-term.”

IRAN SAYS ‘ZERO LESSONS LEARNED’
After Mr. Trump’s initial remarks on Sunday, Iran’s Islamic Revolutionary Guards warned that military vessels approaching the Strait will be considered a ceasefire breach and dealt with harshly and decisively, underlining the risk of a dangerous escalation.

A US official said Iran rejected Washington’s call for an end to all uranium enrichment, the dismantling of all major enrichment facilities and the transfer of highly enriched uranium.

Iran also refused US demands that Iran cease funding for Hamas, Hezbollah and the Houthis, as well as fully open the Strait of Hormuz, the official added.

Iranian media said there was agreement on a number of issues, but the Strait and Iran’s nuclear program were the main sticking points.

Iranian Foreign Minister Abbas Araghchi said Iran had “encountered maximalism, shifting goalposts, and blockade” when just inches away from an “Islamabad MoU (memorandum of agreement).”

“Zero lessons learned,” he added. “Good will begets good will. Enmity begets enmity.”

Even if the ceasefire holds, many analysts expect it will take some time before energy flows through the Gulf return to normal, which will mean higher fuel prices and stronger inflation for the global economy.

Mr. Trump told Fox News’ Sunday Briefing program that oil and gasoline prices may remain high through November’s midterm elections, a rare acknowledgement of the potential political fallout from the war.

Iran’s Mohammad-Bagher Ghalibaf posted a map of Washington-area gasoline prices on social media with the comment: “Enjoy the current pump figures. With the so-called ‘blockade.’ Soon you’ll be nostalgic for $4-$5 gas.”

MORE NEGOTIATIONS?
Mr. Trump said he believed Iran would continue to negotiate and called the Islamabad discussions “very friendly.”

“I do believe they’re going to come to the table on this, because nobody can be so stupid as to say, ‘We want nuclear weapons,’ and they have no cards,” he said.

But several hours later, the US president said he did not care whether a “desperate” Iran returned to the negotiating table.

“If they don’t come back, I’m fine,” Mr. Trump told journalists on Sunday night after he returned to the Washington area from an overnight stay in Florida.

Mr. Ghalibaf blamed the US for not winning Tehran’s trust, despite his team offering “forward-looking initiatives.” Iran’s President Masoud Pezeshkian, who discussed the talks in a call with Russian President Vladimir Putin, said Tehran wanted “a balanced and fair agreement.”

“If the United States returns to the framework of international law, reaching an agreement is not far off,” he told Mr. Putin, Iranian state media reported. — Reuters

BUDAPEST — Peter Magyar’s landslide victory in Sunday’s Hungarian election has handed his center-right Tisza party a sweeping mandate that will give it a free hand to enact reforms, bolster the rule of law and potentially unlock billions in European Union (EU) funding.

Economists and political analysts say the incoming government’s expected two-thirds supermajority was the most EU- and market-friendly scenario — and before Sunday, one of the most improbable — and would likely trigger a strong rally in Hungarian assets on Monday.

A number of uncertainties remain, and wary diplomats and analysts say the new government must deliver on its promises before reaping the full benefits, but the markets for now look willing to give Budapest’s new masters the benefit of the doubt.

“The result is a game changer and will allow Magyar to govern with a free hand,” said Mujtaba Rahman, a managing director at Eurasia Group. “Most importantly, he will be able to unwind Orban’s autocracy and deliver on all of the reforms the EU is demanding.

“That means at least €6.4 billion ($7.46 billion) from the resilience and recovery facility should flow quickly, shoring up the real economy and further consolidating Tisza’s win.”

MAGYAR PLEDGES TO REBUILD ALLIANCES
The election had long been anticipated as the ‌most market-sensitive in Europe this year given the Euroskeptic Viktor Orban’s frequent clashes with Brussels during his 16-year rule, over issues ranging from immigration to his closeness to Russia.

Mr. Orban had expressed confidence throughout the election campaign despite lagging in opinion polls, saying his goal was to protect Hungary’s national identity and traditional Christian values within the EU, while denying any wrongdoing.

But the markets had been signaling for weeks that investors expected change. The share prices of companies linked to Mr. Orban fell sharply, while market volatility gauges indicated that big currency moves were likely after the election.

Mr. Magyar, addressing jubilant supporters chanting “Europe, Europe” after Mr. Orban conceded defeat, pledged to make Hungary a strong EU and NATO ally and rebuild ties marred by years of conflict.

“With the two-thirds majority allowing us to amend the constitution, we will restore the system of checks and balances,” Mr. Magyar said.

“We will join the European Public Prosecutor’s Office and guarantee the democratic functioning of our country. We will never again allow anyone to hold free Hungary captive or to abandon it.”

One fundamental plank of Mr. Magyar’s plan to kick-start Hungary’s economy, which has been mired in near stagnation for the past three years, was to unlock EU funds frozen as democratic standards eroded under Mr. Orban.

“A constitutional majority is a different story entirely,” said Ian Bremmer at GZERO Media.

“That would give Magyar the power to rewrite the constitution, clear out Fidesz loyalists from captured institutions, fully access EU funding, and even adopt the euro — a core campaign pledge.”

On Sunday, Mr. Magyar called on Hungary’s chief prosecutor, the head of the top court, the head of media authority and other officials to resign, saying the country’s public institutions had been captured by Mr. Orban loyalists over the past 16 years.

DIPLOMATS AND RATING AGENCIES CAUTIOUS ON EU FUNDS
Mr. Magyar has pledged a sweeping anti-corruption drive as his party seeks to meet EU conditions, including stronger judicial independence and public procurement, to unlock the funds.

However, credit rating agencies such as S&P Global and Fitch Ratings, as well as some EU diplomats, are skeptical about whether any money still available under Hungary’s pandemic recovery funding would be released.

Diplomats and analysts say comparisons with Poland’s 2023 election, when Prime Minister Donald Tusk’s pro-EU cabinet secured a quick release of EU funding on promises to roll back his nationalist predecessor’s policies, may be misguided.

“There is no willingness to give out the money only on a promise like the EU did to Tusk in Poland, who was not able to deliver on most promises,” said an EU diplomat.

“Tisza would need to demonstrate that it can deliver. But if something is legally impossible, and that can be demonstrated, then the EU could figure out a way.”

Analysts at Capital Economics say the release of EU funding could help cut Hungary’s budget deficit towards 3.5% to 4% of national output by the end of the decade and stabilize public debt — the EU’s highest outside the euro zone.

“Overall, the election result marks a major turning point for Hungary’s economy,” Liam Peach said in a note.

“The durability of any positive market reaction will now depend on how quickly Tisza moves to rebuild relations with the EU, secure EU fund disbursements and signal a credible medium-term fiscal anchor.” — Reuters

SEOUL — South Korean President Lee Jae Myung and Polish Prime Minister Donald Tusk agreed on Monday to upgrade ties to a comprehensive strategic partnership, with the leaders placing defense cooperation at the center of the relationship.

In remarks made before talks between the leaders at the presidential Blue House, Mr. Lee said the countries would further expand defense industry cooperation under a $44.2-billion framework pact signed in 2022.

“K2 tanks, K9 self‑propelled howitzers, FA‑50 light-attack aircraft, and Chunmoo multiple rocket launchers — bearing South Korea’s technology and pride — are now safeguarding Poland’s territory and its people across its vast lands,” Mr. Lee said.

The South Korean leader said that the partnership extended beyond arms sales to include joint production, technology transfers and training.

Mr. Tusk described South Korea as Poland’s “most important ally after the United States, especially in the defense industry” and said he would personally oversee expanded defense cooperation between the countries.

He said the upgraded partnership meant the two countries would take on a shared responsibility and should play a role in contributing to global peace and international stability.

The two leaders also affirmed expanded cooperation across a wide range of fields, including energy supply chains, infrastructure, science and technology, advanced industries, space, and people‑to‑people exchanges.

South Korea has become one of Poland’s leading arms suppliers in recent years as Warsaw moves to rapidly modernize its military following Russia’s invasion of Ukraine.

In 2022, South Korea and Poland signed a defense framework agreement for South Korean companies to supply Poland with arms ‌as well as jointly produce military equipment on Polish soil.

Since then, defense companies including Hanwha Aerospace and Hyundai Rotem have signed follow-up, multibillion-dollar contracts to supply equipment such as tanks and missile launchers. — Reuters