View: Trump Desperate to Disengage Ahead of Midterms, US and Iran May Reach Accord on Key Demands

April 12 – CITIC Securities released an analysis of U.S.-Iran negotiations, outlining key demands from both sides and low odds of extreme conflict escalation. ### U.S. Core Demands Trump’s top priority would be Iran abandoning uranium enrichment—this would be a critical win for the U.S. and a key political asset to bolster his domestic standing. The current conflict has hurt his midterm election prospects, pushing him to wrap up early. Since the Iranian Revolution, the U.S. has lost control over Iran’s nuclear program—a unresolved challenge for past presidents that’s undermined U.S. Middle East strategy. Compared to the political messaging impact of Iran abandoning enrichment, the indirect link between oil prices and inflation is a smaller election factor. Thus, the Trump administration may compromise on issues like oversight of the Strait of Hormuz. ### Iran’s Core Demands The conflict has underscored that blocking the Strait of Hormuz and threatening Middle East infrastructure are key leverage points—more disruptive and flexible than nuclear threats. Nuclear weapons carry exorbitant costs and uncontrollable scope, while strait blockades and infrastructure targeting only require low-cost drones to hit the U.S. and global economy hard, making these Iran’s main tools to counter the U.S. Both sides have repeatedly avoided crossing the red line of large-scale infrastructure attacks, so extreme war escalation is unlikely. As a result, extreme oil price spikes, deep recession, or stagflation are not probable.