The fragile ceasefire between the United States and Iran, implemented just over a month ago, is showing signs of unraveling amid renewed hostilities, casting doubt on prospects for a lasting peace agreement. The 60-day truce, which followed months of intense conflict, was initially agreed upon by both sides due to widespread war weariness and economic pressures. However, recent escalations signal mounting challenges to sustaining the accord.

US President Donald Trump’s decision to launch a military strike on Tehran in late February was based on an expectation that the conflict would quickly force the collapse of the Iranian regime. Instead, the fighting has persisted into July, complicating US foreign policy and domestic political calculations. The continuation of hostilities has contributed to rising energy costs in the United States, a factor that could influence voter sentiment ahead of the midterm elections. Criticism of Trump’s handling of the conflict has emerged from within his own Republican Party, raising questions about his effectiveness in managing global security threats.

For Iran, the ongoing tensions exacerbate an already strained economic situation and have deepened divides within the country’s political landscape. More pragmatic factions in Tehran advocate for easing tensions and seeking dialogue with the West, while hard-line elements aligned with the Islamic Revolutionary Guard Corps (IRGC) staunchly oppose compromise. The IRGC appears to view continued confrontations in the Gulf as a means of increasing political pressure on the Trump administration.

The ceasefire, formalized through a 14-point memorandum of understanding outlining the framework for a permanent settlement, was always vulnerable to disruption. The IRGC’s opposition to de-escalation and recent military actions—Iranian attacks on Gulf states followed by US strikes on IRGC targets—highlight the tenuous nature of the agreement. At a NATO summit in Ankara this week, Trump declared the ceasefire “over,” though it remains unclear whether this marks a definitive collapse or simply another phase in a series of episodic exchanges since the truce’s inception.

A key sticking point in any future peace deal remains Iran’s nuclear program and control of the Strait of Hormuz, a strategically vital shipping route. Trump has maintained that any agreement must prevent Tehran from continuing uranium enrichment activities, which are widely believed to be aimed at developing nuclear weapons. He also rejects Iran’s assertions of sovereignty over the strait and its proposals to impose tolls on merchant vessels, a stance shared by China.

Internal politics in Iran have further complicated the situation. Recent nationwide ceremonies marking the funeral of former Supreme Leader Ayatollah Ali Khamenei were leveraged by hard-liners to consolidate their influence. Authorities reported massive crowds—up to 20 million participants—and the events featured strong anti-American rhetoric, including calls for Trump’s assassination and denunciations of Iranian negotiators as traitors.

Despite the heightened rhetoric and recent military flare-ups, some US officials remain intent on keeping diplomatic channels open. However, Trump’s personal animosity toward the Iranian leadership and his public condemnation of their officials as “scum” have diminished prospects for constructive dialogue. With ongoing attacks on shipping in the Strait of Hormuz, Washington may find it increasingly difficult to avoid engagement with Tehran.

Even if the United States were to embark on another full-scale military campaign against Iran, analysts caution there is no guarantee it would compel the regime to accept American terms. While US and Israeli forces have reportedly crippled a large portion of Iran’s military capabilities, the regime’s continued ability to strike at US forces and Gulf neighbors underscores its resilience and the complexities of achieving a definitive resolution.