Recasting Failure in US–Iran Talks

My conclusion is stark - the United States must accept its defeat, ensure the full reopening of the Strait of Hormuz, withdraw the economic sanctions imposed on Iran, and pay for the damages caused during this war. Anything less would not be diplomacy—it would be denial repackaged as success.

The ongoing negotiations between the United States and Iran are increasingly shaped by narrative management rather than strategic success. What began as a forceful campaign—closely aligned with Israel—to curb Iran’s regional influence and nuclear trajectory has delivered outcomes far removed from its declared objectives.

Washington promised deterrence, rollback, and compliance. Instead, Iran’s regional posture remains intact, its negotiating leverage has hardened, and its capacity to absorb economic pressure has proven more resilient than anticipated. Even after weeks of conflict, talks remain “far from a breakthrough,” with fundamental disagreements unresolved.

Meanwhile, the situation around the Strait of Hormuz underscores the scale of miscalculation. Shipping through the strait has collapsed dramatically—from around 140 vessels a day to barely a handful—disrupting nearly a fifth of global oil and LNG flows and sending shockwaves through global markets.

The fallout has been indiscriminate: oil-exporting Arab states face revenue uncertainty, while energy-importing economies grapple with inflationary pressure and supply disruptions.

Yet, despite these outcomes, the language from Washington has shifted toward “progress” and “opportunity.” This is less a reflection of facts and more an attempt to reframe strategic underperformance as diplomatic achievement. The absence of a clear exit strategy, coupled with rising global economic costs, only reinforces the perception of a policy that has drifted without delivering.

This brings the debate to its unavoidable conclusion. Strategic overreach, when left unacknowledged, does not fade—it compounds. The longer reality is denied, the greater the cost imposed on others.

My conclusion is stark - the United States must accept its defeat, ensure the full reopening of the Strait of Hormuz, withdraw the economic sanctions imposed on Iran, and pay for the damages caused during this war. Anything less would not be diplomacy—it would be denial repackaged as success.

PSX benchmark index down 1.9%WoW

Pakistan Stock Exchange (PSX) witnessed reversal of momentum during this past week, the benchmark index shed 3,267 points, down 1.9%WoW to close at 170,672, as investors tried to understand more complex geopolitical realities following last week's ceasefire driven rally.

The average daily trading volume rose to 1,665 million shares - up 31.7%WoW, with investor risk appetite witnessing pullbacks as US-Iran diplomatic talks encountered fresh hiccups. However, sentiment returned during second half of Friday’s session as Iran confirmed the arrival of its foreign minister to Pakistan over the weekend.

Furthermore, US president’s indefinite extension of the ceasefire on Tuesday, hours before its expiry kept hopes of resolution alive and prevented a material selloff as well.

Oil prices rose 3.2%WoW to US$104.8/ bbl, as Iran's seizure of two container vessels attempting to transit the Strait of Hormuz reignited supply disruption fears.

On the macroeconomic front, IMF’s executive board is expected to consider approval of the fourth tranche of the 37-month program during May’26.

Foreign exchange reserves held by State Bank of Pakistan (SBP) rose to US$15.1 billion.

Other major news flow during the week included: 1) Pakistan ups Eurobond issuance to US$750 millio, 2) IMF to vet auto policy before cabinet, 3) IMF urges removal of non-tariff curbs, 4) Pakistan seeks LNG spot cargoes after December, and 5) First Central Asian shipment reaches Pakistan via China.

Top active sectors were: Textile Weaving, Refinery, Synthetic & Rayon, while lagged included: Jute, Pharmaceuticals, and Cement.

Major selling was recorded by Insurance, and Other Organization aggregating to US$16.9 million. Individuals and Companies emerged net buyers with US$17.2 million.

Top performing scrips included: YOUW, ATRL, GADT, IBFL, and MUREB, while laggards included: PIOC, DGKC, ISL, CPHL, and MLCF.

AKD Securities believes that a constructive resolution would remain the pivotal near-term catalyst for the market direction, with any positive developments over the weekend becoming the trigger.

According to the brokerage house, despite the recent recovery, market continues to trade at attractive values.

Top picks of the brokerage house include: OGDC, PPL, UBL, MEBL, HBL, FFC, ENGROH, PSO, LUCK, FCCL, INDU, ILP and SYS.

 

Israel: Promise of Stability Remains Fragile

At 78, Israel remains a study in contrasts—secure yet unsettled, integrated yet isolated within its immediate neighborhood. Its relations with bordering states reveal a pattern shaped less by reconciliation and more by necessity.

With Egypt and Jordan, Israel has maintained durable—if cold—peace. The framework established after the Camp David Accords continues to hold, anchored in security coordination and shared concerns over militancy and border stability. These ties are transactional, not transformative, reflecting mutual restraint rather than genuine normalization.

On its northern front, the equation turns volatile. Lebanon remains locked in a cycle of tension with Israel, largely driven by the influence of Hezbollah. Deterrence has prevented full-scale war in recent years, but the absence of a political settlement ensures that the border remains one miscalculation away from escalation.

In Syria, hostility persists in a more fragmented form. Israel’s periodic strikes targeting Iranian-linked assets underscore a broader contest with Iran for regional influence. Syria’s internal disarray has limited direct confrontation but has also entrenched a shadow conflict that resists closure.

The most enduring and consequential relationship remains with Palestine. Here, there is neither peace nor stable deterrence—only recurring cycles of confrontation. The unresolved status of Palestinians continues to define Israel’s regional image and constrains its acceptance among Arab publics, regardless of evolving state-level ties.

At 78, Israel has achieved military superiority and economic resilience, yet its neighborhood tells a more restrained story. Peace exists, but without warmth. Conflict is contained, but not resolved.

The result is a strategic environment where coexistence is managed, not embraced—and where the promise of stability remains persistently fragile.

What Next? Escalation not a solution

As the fragile truce nears its end, the diplomatic space between United States and Iran appears to be narrowing rather than expanding. Signals from both sides suggest that compromise remains elusive. If Tehran refuses to accept Washington’s terms—as appears likely—the question is no longer whether tensions will rise, but how far escalation might go.

Rhetoric from Donald Trump has reinforced a posture of maximum pressure, where the implicit belief is that overwhelming force can compel compliance. Yet history offers a more sobering lesson: coercion against resilient states rarely produces submission. Instead, it hardens positions and invites asymmetric responses.

Iran’s strategic doctrine is built precisely for such scenarios. Without matching conventional military strength, it retains the capacity to disrupt through missile reach, proxy networks, and its geographic proximity to critical energy corridors. Even a limited confrontation could unsettle the Gulf, placing key oil infrastructure at risk and sending shockwaves through global markets. In such a scenario, the very objective often attributed to US strategy—securing long-term influence over energy flows—would be undermined by instability and destruction.

The risks are not confined to the immediate theatre. Escalation in the Gulf increases the probability of miscalculation, where unintended actors or incidents widen the conflict. Not every escalation becomes global, but the absence of clear off-ramps makes containment far more difficult once hostilities resume.

This is the central contradiction - a strategy designed to enforce compliance may instead erode control. Military superiority does not automatically translate into political outcomes, particularly in conflicts where the adversary’s threshold for pain is structurally higher and its response options more diffuse.

For Washington, the more effective path lies not in testing the outer limits of force, but in recognizing the limits of coercion itself.

A calibrated approach—however politically inconvenient—offers a better chance of preserving stability than a conflict whose consequences would be both immediate and enduring.

موجودہ جنگ ایران نہیں بلکہ عرب ملکوں کی معاشی تباہی کے لیۓ

 گزشتہ سال جون میں امریکہ اوراسرائیل نے جب ایران پر ایک ساتھ حملہ کیا تو ویسٹرن میڈیا نے تاثردیا کہ یہ حملے ایران کے ایٹمی اورمیزائیل پروگرامز کو نقصان پہنچانے کے لیۓ تھے۔

 اس سال فروری میں ان دونوں ملکوں نے دوبارہ اور زیادہ شدت سے ایران پرحملے کیۓ اور ایٹمی اورمیزائیل پروگرامز کو نقصان پہنچانے کے ساتھ رجیم چینج کا نعرہ بھی شامل کیا گیا۔

 میرے خیال میں یہ غلط بیانی تھی، اصل مقصد تیل پیدا کرنے والے عرب ممالک کی معیشت کو تباہ کرنا ہے۔ ممکن ہے آپ میں سے بہت سے پڑھنے والے میرے موقف سے اختلاف کریں، لیکن میری ان سے گزارش ہے کہ ان چند لائنوں کوپڑھیں اور ٹھنڈے دل سے غور کریں:

آبناۓ ھورمزکی بندش کے بعد یہ بات کی کسی حد تک تصدیق ہوگئی۔ یہ خبریں بھی آگئیں کہ اب تک عرب ممالک کا 500 ملین بیرل کروڈ آئل ایکسپورٹ نہیں ہو سکا۔

جنگ کے دوران یہ تاثر دیا گیا کہ ایرانی حملوں کی وجہ سے عرب ملکوں کی تیل اور دوسری اہم تنصیبات کو نقصان پہنچاہے۔ کچھ تجزیہ کاروں کا یہ خیال ہے کہ یہ تباہی اسرائیلی حملوں کی وجہ سے ہوئ ہے، ایرانی حملوں کی وجہ سے نہیں۔

اب تو یہاں تک کہا جارہا ہے کہ عرب ملکوں میں امریکی اڈے مقامی آبادی کو بطور ہیومن شیلڈ استعمال کررہے ہیں اور یہ اڈے عرب ممالک نہیں بلکہ اسرائیل کی حفاظت کےلیۓہیں۔

مسلمانوں کی لیۓ ضروری ہے کہ اپنے اصل دشمن کو پہچھانیں۔

Merciless Use of Power: US-Israel War Doctrine

The language of security and deterrence is increasingly being tested against a stark and visible reality - widespread destruction, mounting civilian casualties, and deepening global economic strain. The ongoing conflicts in Gaza and Iran suggest that the use of power is no longer calibrated—it is being exercised with a level of intensity that raises fundamental questions about restraint.

Gaza today is emblematic of this shift. Entire neighborhoods lie in ruins. Critical infrastructure—schools, hospitals, water and electricity systems—has been devastated. Casualty estimates run into the tens of thousands, with women and children disproportionately affected. For survivors, the crisis persists in the form of displacement, hunger, and a fragile humanitarian environment that shows little sign of recovery.

This scale of destruction challenges the notion that civilian harm is incidental. Instead, it points to a pattern where overwhelming force becomes central to achieving strategic objectives.

The role of the United States in this dynamic is pivotal. Beyond diplomatic backing, Washington’s material and political support has enabled the continuation of military operations whose humanitarian consequences are globally visible. This alignment raises difficult questions about whether strategic partnerships are overriding considerations of proportionality and civilian protection.

Since February 28, 2026, the expansion of conflict into Iran has reinforced these concerns. Thousands of air strikes carried out by the United States and Israel mark a significant escalation. While framed within the context of security, the scale and persistence of these operations suggest a broader objective—one that risks pushing the region toward prolonged instability and humanitarian distress.

Ceasefire negotiations, though ongoing, have yet to inspire confidence. Previous patterns indicate that such pauses often serve as tactical interludes rather than genuine turning points. The concern is that they provide space not for resolution, but for regrouping before renewed and potentially more intense confrontation.

Compounding the crisis is the growing focus on the Strait of Hormuz. Any disruption to this critical energy corridor carries global consequences. Volatility in oil and gas prices has already translated into inflationary pressures, supply chain disruptions, and economic uncertainty far beyond the Middle East. For developing economies, this is not a distant geopolitical issue but an immediate and tangible burden.

What emerges is a troubling convergence - the normalization of large-scale military force in conflict zones and the externalization of its economic costs to the rest of the world.

At some point, the debate moves beyond intent. When outcomes repeatedly include devastated civilian infrastructure, mass suffering, and global economic strain, the nature of the strategy itself comes under scrutiny. The question is no longer whether power is being used—but how, and at what cost.

PSX benchmark index up 4.0%WoW

Pakistan Stock Exchange (PSX) remained positive during this past week ended on Friday April 17, 2026, supported by easing geopolitical tensions and softer oil prices. The benchmark Index surged by 6,748 points or 4.0%WoW to close at 173,939. Average daily trading increased to 1,264 million shares, from 918 million shares during the earlier week, up 37.6%WoW.

One of the key boosters of investors’ sentiments was an inflow of US$2.0 billion from Saudi Arabia, with an aggregate committed support of US$8.0 billion, including a rollover of US$5.0 billion.

Sentiments improved following the Prime Minister’s announcement of reduction in prices of motor spirit and high speed diesel.

Confidence was further supported by Pakistan’s role in in ceasefire in a US-Iran war on optimism around a second round of talks to take place in Islamabad.

Fertilizer and Autos remained in focus. Urea offtake increased by 86%YoY to 569,000 tons in March 2026, while DAP, CAN, and NP sales also surged.

Auto sales rose to 19,100 units in March 2026, up 46%YoY, primarily driven by strong tractor sales.

Pakistan posted a current account surplus of US$1.07 billion in March 2026, marking the third consecutive surplus.

Another important feature was reduction in T-Bills yield.

UBL’s higher than expected earnings for the first quarter supported the momentum.

Leather & Tanneries, Textile Weaving, and Vanaspati & Allied Industries emerged as top performing sectors, while, Woollen and Tobacco were the laggards.

Major buying was recorded by Individuals and Companies with a net buy of US$10.7 million and US$10.5 million. Banks and Insurance companies emerged as major seller with a net sell of US$22.1 million and US$9.6 million respectively.

Top performing scrips of the week were: GAL, GHNI, LOTCHEM, BOP, and SRVI, while laggards included: PTC, FATIMA, ATRL, MEBL, and BNWM.

 According to AKD Securities, going forward, upcoming negotiations in Islamabad on US-Iran war would remain a key focus for investors. Any positive development would likely keep the market robust.

Despite the recent recovery, market continues to trade at attractive valuations.

According to the brokerage house the benchmark index is expected to reach 263,800.

Top picks of the brokerage house include: OGDC, PPL, UBL, MEBL, HBL, FFC, ENGROH, PSO, LUCK, FCCL, INDU, ILP and SYS.