WASHINGTON: President Donald Trump executed one of his most dramatic foreign policy reversals yet, abandoning threats of military strikes against Iran in favor of claimed 'very productive' negotiations.
Just days after giving Tehran a 48-hour ultimatum to reopen the Strait of Hormuz or face massive attacks on its power infrastructure, Trump announced a new five-day window for diplomacy.
He praised unnamed "highly respected" Iranian officials during a speech in Memphis, touting his business instincts as the driving force behind the breakthrough.
But Iranian authorities denied any direct talks were underway, casting doubt on the White House narrative.
Markets reacted swiftly: North Sea Brent crude plunged over 14%, West Texas Intermediate dropped nearly 10%, while the Dow Jones surged 700 points.
The reversal fits a pattern now dubbed "TACO"-"Trump Always Chickens Out"-a term coined after past rollbacks on global tariffs and other high-stakes threats.
Analysts say market volatility stems from Trump’s improvisational style, with agreements often lacking concrete outcomes. Expert Garret Martin attributes the Iran pivot to market pressure, Gulf state influence, and internal MAGA movement tensions.