DUBAI, United Arab Emirates — President Donald Trump is confronting new realities nine months into the war with Iran that leave him with dwindling options to ending the conflict.
On Thursday, he waved away the need for a deal with Iran, saying the U.S. has billions of Iran's dollars frozen in overseas accounts.
"We don't need a deal with Iran. Those days have long since passed. We've got their money," he wrote in a Truth Social post.
Negotiations with Iran are stuck with mediator Qatar working to bridge the divide. Trump met Qatar's prime minister at the White House this week, and said afterward that Gulf Arab allies prefer "the status quo" of continued economic pressure on Iran. He wrote that while the U.S. remains "locked and loaded", an attack at this point "seems to be quite unlikely."
That's a pivot from his threats to carry out quick, intense strikes on Iran in the days before he had to contend with two election setbacks.
Trump's wartime ally, Israeli Prime Minister Benjamin Netanyahu, whom he'd thrown his support behind, is on the cusp of being ousted from power after elections there.
Meanwhile, at home, Trump's party lost its majority in Congress in midterm elections. Vice President JD Vance blamed Republican losses on the unpopular war with Iran and the nature of U.S. relations with Israel.
With less room to room maneuver and Iran still defiant, Trump's strategy appears to be to keep things as they are, for now. That means the possibility of escalation still looms.
Senior UAE diplomat, Anwar Gargash, told an audience in Abu Dhabi this week the region must "prepare for a prolonged period of uncertainty, in which neither a decisive resolution nor a stable regional order can be taken for granted."
Here's what keeping the status quo looks like.
Iran's chokehold on the Strait of Hormuz persists
Official Iranian social media accounts frequently post videos of attacks on ships in the Strait of Hormuz for violating Iran's new rules requiring permission to navigate the waterway, which was open and free to ships before the war.
The U.S., meanwhile, is assisting oil tankers through the Strait of Hormuz using a route that's close to Oman's coastline. While this has helped Arab states export their oil, it does not solve the bigger problem of how to bring back the pre-war production levels of other vital products like liquified natural gas, fertilizer and aluminum. Nor does a status quo allow countries like Kuwait, Qatar and Bahrain to import goods to their ports.
The International Monetary Fund says Gulf Arab states are in economic recession as a result of the war, despite higher oil prices. It says Kuwait, Qatar and Iraq's economies are contracting approximately 16% this year. Bahrain's is down 11%.
More limited strikes that could rapidly escalate
The U.S. is sending a third aircraft carrier with thousands of troops to the region, leaving open the possibility of another planned military escalation.
This week, Iran unveiled what it says is a new underground missile production site.
The U.S. and Iran are also still occasionally carrying out tit-for-tat for strikes.
On Friday, Iranian media said the U.S. struck one of its islands in the Strait of Hormuz. It's an area where Iran has radars and drone launch sites. Iran's Revolutionary Guard said it hit back, targeting an early warning U.S. radar in Bahrain.
Iran remains economically battered, starved of oil revenue
Secretary of State Marco Rubio told reporters this week there's no need for military action against Iran at this stage because economic sanctions are doing the job.
"The pain that they're feeling is, eventually you have to eat. Eventually you have to be able to pay your own fighters and your own security forces," Rubio said.
There's also a U.S. naval blockade at sea barring Iranian ships from transporting oil to countries like China. This blockade, according to the U.S. military, has cut Iran off from at least $25 billion in revenue so far.
One of the biggest economic blows, though, has come from the United Arab Emirates. The UAE announced over the summer it was severing all economic and trade ties with Iran. The UAE had been among Iran's biggest trade partners and local bank accounts were allegedly used by Iran's supreme leader and Revolutionary Guard to move money around.
Meanwhile, the U.S. military's Central Command announced a new operation, dubbed "Iron Gate", with other U.S. government agencies, aimed at preventing Iran from using land routes to transport advanced weapons across its borders and the Caspian Sea.
War in Yemen intensifies, draws in more countries
Another consequence of the conflict with Iran is the resumption of all-out war between Saudi Arabia and the Houthis in Yemen.
The Houthis, who are not a direct proxy of Iran but are supported by it, say Saudi airstrikes across Yemen have killed scores of people in past months, including nearly 60 this past weekend, many of them women and children in a village near the capital Sana'a.
Saudi Arabia, meanwhile, faces daily missile and drone attacks by Houthis, including some this week that hit its key East-West pipeline carrying crude oil to bypass the Strait of Hormuz. Another Houthi attack hit Saudi oil company Aramco's skyscraper headquarters in Riyadh's financial district.
Deadly Houthi attacks on Saudi airports have led to flights and high-profile events being cancelled. https://www.npr.org/2026/11/02/nx-s1-6007693/wars-in-iran-and-yemen-dent-saudi-modernization-mega-projects
As the Yemen war drags on, Pakistan, Turkey and Egypt are among the countries entering the fray with defensive support to Saudi Arabia. The U.S. is assisting with intelligence on the Houthis.
The United Nations says some 330,000 Yemenis have been displaced by the renewed fighting between the Houthis and the Saudi-backed Yemeni government, exacerbating an already dire humanitarian crisis.
Efforts by mediators continue, neither side budges
Iran says it's prepared for a short-term pause on attacks on ships in the Strait of Hormuz, but insists that seven demands be met before entering into direct talks over its nuclear program.
"The message has been only one thing. These seven items are on the table. Take it or leave it," Hamidreza Gholamzade, Tehran municipality spokesperson, told NPR.
These demands include lifting sanctions, ending the naval blockade, unfreezing Iran's dollars in overseas accounts and enforcing a ceasefire across all fronts, which includes halting Israeli attacks in Lebanon and Gaza.
Rubio has described the conditions as "absurd".
There's also discussion on diluting and moving Iran's enriched uranium abroad. However, the head of Iran's Supreme National Security Council, Mohsen Rezaei, told Iran's state broadcaster Wednesday: "We will not remove even a shred of enriched nuclear material from Iran."
It's another indication of the gridlock.
NPR's Hadeel al-Shalchi in Antalya, Turkey, and Ahmed Abu Hamada in Cairo contributed reporting.
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