There have been numerous developments since the last time I wrote about Trump's war of choice in Iran, so I decided today would be a good day to review them all. First and foremost, the two-week ceasefire is now half over, and as originally scheduled is due to expire next Tuesday.

High-ranking representatives from the United States and Iran sat across a table from each other in Pakistan last weekend, which is notable since it is the first such direct bilateral talks between the two countries since the 1979 revolution. Vice President JD Vance led the American delegation. It was apparently just one long marathon of a day of talks. The two sides reportedly sat down for over 20 hours straight, but at the end neither one had anything to announce and everyone flew home.

Also noteworthy on the diplomatic front was having representatives from Israel and Lebanon meet in Washington this week for their own ceasefire negotiations. Nothing solid has come from these talks yet, but they were also rather notable (that the two countries even sat down and talked to each other).

After the talks between the U.S. and Iran ended, Donald Trump apparently got a bee in his bonnet and announced that the U.S. military would institute a total blockade of all ships passing through the Strait of Hormuz. In one way, this is giving Iran what it wants, since Iran has been effectively blockading the Strait for weeks -- however, they have been allowing certain ships to pass through. They've reportedly been charging high "tolls" for each ship passing through the Strait, which gives them a new income source.

Trump quickly changed his mind about blocking all shipping through the Strait (after either some oil executives, some Gulf state leaders, or the U.S. Navy explained what the result of a full blockade would be) and refined it to mean a blockade of all Iranian ports instead. No ships will be allowed to sail either to or from any port in Iran, while (hopefully) shipping for all other countries will resume through the Strait.

So far, this seems to have had limited success. The U.S. has turned back a number of ships approaching the Strait, while a few non-Iranian ships that had been stuck have now made it out by passing through the Strait. This has all been accomplished without any military confrontation (forcible boarding of ships or U.S. warships challenging Iranian ships), at least so far. Iran has not shot missiles or drones at any of the ships leaving the Gulf, and none of them have struck any mines -- again, at least so far.

Rumors are flying about what direction the talks between the two countries (facilitated by Pakistan's government, who is acting as a go-between) are taking now. One was that Iran had offered to suspend all uranium enrichment for five years while the U.S. was demanding 20 or 30 years. Both sides are rumored to want a deal, but then that just may be propaganda. Trump seems pretty eager to put an end to it all, but then again he is so mercurial that he could easily escalate next week (if the ceasefire ends). Another U.S. aircraft carrier (making a total of three) is headed to the region, along with more Marines, so who knows what will happen next? If real progress is made, then further face-to-face talks might be the next step. Another rumor was that Trump wanted to extend the ceasefire, but the White House denied it (although an extension may be necessary).

The Iranians are threatening their own escalation, in reaction to all of this. They are now threatening to attack ships in the Persian Gulf, the Sea of Oman, and the Red Sea. The first two are the bodies of water that the Strait of Hormuz connects, so this wouldn't really be much of an escalation -- if Iran can threaten ships in the Strait then that will bring most other shipping in the region to a halt. But the Red Sea is a different story.

Shipping in the Red Sea was threatened, after the war in Gaza started. The Houthis in Yemen (who are allied with Iran) attacked ships with missiles, and the United States retaliated against them for a while, which seems to have fixed the problem (the Houthis stopped shooting at ships, eventually). But if the Houthis begin to threaten Red Sea shipping again by launching new missile attacks, this could open up another whole front in the war. It'd be pretty easy for them to do so, since their own country sits at a maritime bottleneck at the mouth of the Red Sea, much like Iran sits on the Strait of Hormuz. If they do successfully attack some ships, it could shut down not just the Red Sea but the Suez Canal at the other end of it -- meaning worldwide shipping would have to divert all the way around Africa to get to the Mediterranean. And it would likely mean American missiles and bombs get redirected to strike the Houthis in Yemen as well.

Back here at home, gasoline prices remain high but have hit a plateau and even fallen back a tiny bit. Before the ceasefire began, the average price for a gallon of gas nationwide in America was $4.17. But the long spike upwards that began with the start of the war finally reversed itself, and since then the price has slowly dropped to $4.08 (as of this writing). The price of crude oil remains above $100 a barrel worldwide, but this too has fallen a bit from the highs it reached (over $115 a barrel, at one point). If the ceasefire ends and both sides resume attacking each other, this plateau in prices might also end. If the Navy is successful in both blockading all of Iran's ports (which would mean they couldn't ship any of their own oil out) and reopening the Strait of Hormuz for all the other ships, then this will have an impact on the global price of oil. If one of those is accomplished but not the other, it will have a different impact. That's about all you can confidently say, at this point. If Iran is successful in causing maritime insurers to refuse to insure ships passing through the Red Sea, however (if the Houthis do start successfully attacking ships), then this could also change the dynamic.

If some sort of peace deal is reached, then the price of gasoline at the pump and oil worldwide would definitely come down. How far it will come back down is still an open question, however. It's not like flipping a switch -- the prices probably won't return to where they were pre-war ($2.75 a gallon here in the U.S., and roughly $70 a barrel worldwide) for quite some time. First, there will be a backlog to clear. All those ships stuck behind the Strait will go out, and eventually regular shipping schedules will resume. But refineries and other oil infrastructure in the Gulf states have suffered damage from missiles and drones. So the volume of output is not likely to return to pre-war levels right away. Rebuilding a refinery is a long process, and depending on the damages suffered, this could take years.

The White House remains cheerily optimistic that prices at the pump will quickly return to pre-war levels. This is what they are hoping for, because if they're wrong it's going to make things a lot harder for Republicans running for re-election in the midterms. Trump speaks as if the prices will come back down as fast as they went up, which is (of course) totally unrealistic. Last month, Energy Secretary Chris Wright said there was a "very good chance" that the average price would fall below $3.00 a gallon by this summer. This is also probably optimistic (perhaps wildly so). Today, Treasury Secretary Scott Bessent was a little more cautious in his phrasing, saying he was "optimistic that during the summer we will see gas with a three in front of it sooner rather than later," putting the timeline very specifically between "June 20th and September 20th." You'll note that this isn't the same thing as promising "$3.00 a gallon," it could be met by just "$3.99 a gallon" (since that number does actually have "a three in front of it").

What will be interesting to see, whenever this war ends, is whether the usual maxim on gas prices will apply or not. Gas prices (economist geeks like to say) "go up like a rocket and come down like a feather." They shoot up far faster than is economically defensible, since the price of the gas sold at American gas stations is the end of a long process, and even price spikes in the worldwide price of oil take a while to work their way through this system. But that doesn't stop the oil companies and gas stations from hiking the price immediately, thus generating pure profit for a while. Then when gas prices come down, this always happens much slower than is justifiable as well, as even though the price-per-barrel may sink, these reductions don't work their way through the system quite as quickly as they actually happen. The oil companies and gas stations take advantage of the fact that consumers have become used to the high prices and are grateful when they come down even a little bit. So they stretch it out, dropping the price as slowly as they think they can get away with.

But this time could conceivably be different, for two reasons. One is that the price hike was obviously caused by one thing and one thing alone: Trump's war. When that war is over, then people are going to expect the price to come down again. That's how the public is going to see it, at any rate. This is different than when the cause of a spike in worldwide oil prices is due to some tangential reason (like the COVID pandemic), because once the war's over, it's over. And the second reason this might be different is that Donald Trump is loyal to no one, so it won't matter how many of his buddies own oil companies, he is going to start publicly berating them if prices stay high all summer long (I would put "high" at "$3.50 a gallon or more"). If Trump is frothing at the mouth about greedy oil companies, they're likely not going to appreciate the public scrutiny and will bend over backwards to lower prices as quickly as they can -- without all the usual "comes down like a feather" windfall profits. This is not guaranteed to happen, I should add, since Trump could choose a different route and either come up with some unrelated reason why gas prices are so high (any reason at all will do, as long as it's not his fault, of course), or he could just start flat-out lying again about what gasoline actually costs average Americans (which he did uninterrupted throughout his entire first year back in office before the war started, claiming without a shred of reality that the price of gas was "below $2.00 a gallon").

That's where everything stands, at the halfway point of the two-week ceasefire. We'll see where we are next week, because what happens either before or right after the ceasefire deadline expires will be crucial. It feels like we are at or approaching a turning point, but it's unclear whether this will be a turn for the better or for the worse. If Iran is truly seeking some sort of deal, then some preliminary deal could be struck which (at the very least) extends the deadline of the current ceasefire. Neither side is going to want to give up their leverage until a final deal is struck, but how long that takes is still an open question (even if the Iranians are ready to deal, these things take time). The war could be over soon, or it could escalate into an even wider war. Both possibilities still exist. The price of gas is still above four bucks a gallon, and U.S. consumers are feeling pretty dismal about that. Which means that if high prices continue for months to come, Republicans will be in serious trouble in the midterms.

-- Chris Weigant

Follow Chris on Twitter: @ChrisWeigant