'Islamabad Accord': Iran, US consider ceasefire proposal via Pakistan; what we know so far

[Editor's Note: Follow Khaleej Times live blog amid US-Israel-Iran war for the latest regional developments.]

Iran and the United States have received a proposal aimed at ending hostilities and potentially reopening the Strait of Hormuz as early as Monday, a source familiar with the plan told Reuters.

The framework, prepared by Pakistan, was shared overnight with both Iran and the US and outlines a two-phase approach: an immediate ceasefire followed by a broader, comprehensive agreement.

Pakistan’s army chief, Field Marshal Asim Munir, has been in continuous contact with US Vice President JD Vance, special envoy Steve Witkoff, and Iranian Foreign Minister Abbas Araghchi throughout the night, the source told Reuters.

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What do we know about the deal?

The proposed deal, tentatively dubbed by reports as the 'Islamabad Accord', would see a ceasefire take effect immediately, reopening the Strait of Hormuz, with 15–20 days allotted to finalise a broader settlement. A regional framework for the strait is also part of the plan, with final in-person talks scheduled in Islamabad.

The framework for a ceasefire is still under discussion, and its details will take time to be worked out. 

Earlier on Sunday, Axios first reported that the US, Iran and regional mediators were discussing a potential 45-day ceasefire as part of a two-phase deal that could lead to a permanent end to the war, citing US, Israeli and regional sources.

Iran has previously told Reuters that it is seeking a permanent ceasefire with assurances that it will not be attacked by the US or Israel. Mediators, including Pakistan, Turkey, and Egypt, have communicated messages to Tehran.

The final agreement is expected to involve Iranian commitments to refrain from pursuing nuclear weapons in exchange for sanctions relief and the release of frozen assets.

When is the deadline?

According to the source, all elements of the plan need agreement today. The initial understanding would be formalised electronically through Pakistan, serving as the sole communication channel for the negotiations.

What is Iran saying?

Iran has formulated its positions and demands in response to recent ceasefire proposals conveyed via intermediaries, a foreign ministry spokesperson said on Monday, according to Reuters, adding that negotiations were "incompatible with ultimatums and threats to commit war crimes."

Spokesperson Esmaeil Baghaei noted that Iran has set out its requirements according to national interests, rejecting earlier U.S. proposals such as the 15-point plan as 'excessive'.

He stressed that Tehran’s clear articulation of its demands reflects confidence in defending its positions, not a willingness to compromise.

"Iran does not hesitate to clearly express what it considers its legitimate demands, and doing so should not be interpreted as a sign of compromise but rather as a reflection of its confidence in defending its positions," Baghaei said in a press conference, as reported by Reuters.

"We have formulated our own responses" and will announce details in due time, he added in response to an Iranian journalist's question regarding ongoing efforts to bring about a ceasefire between Iran and the US.

What we know is that Iran said it won't reopen the Strait as part of a temporary ceasefire, a senior Iranian official told Reuters on Monday, adding that Iran won't accept deadlines as it reviews the proposal. Washington lacks the readiness for a permanent ceasefire, the official said.

What is US saying?

No immediate response has been reported from US officials yet, while Israeli Defence Minister Katz has stated that the Israeli military has been ordered to continue striking Iranian “national infrastructure” with full force, according to Reuters.

In a post laden with expletives on his Truth Social platform on Sunday, Trump threatened further strikes on Iranian energy and transport infrastructure if Iran failed to make a deal and reopen the Strait by Tuesday.

What's the latest status on the Strait of Hormuz?

The secretary-general of the Gulf Cooperation Council (GCC) called Thursday for the UN Security Council to authorise the use of force to protect the Strait of Hormuz from Iranian attacks.

Bahrain has proposed a draft resolution that would greenlight states to use "all necessary measures" to assure free transit through the Strait of Hormuz.

The UAE has also joined Bahrain in calling for UN Security Council action on the Strait of Hormuz, stressing that each day without action brings the world closer to a wider crisis, with countries in the Global South 'facing the gravest consequences'.

However, the measure has divided the 15-member Security Council, with Russia, China and France reportedly voicing objections.

Meanwhile, AFP reported that Iran’s Revolutionary Guards are finalising preparations to implement new operating rules in the Strait of Hormuz, effectively closed since the outbreak of hostilities.

They warned that conditions in the strait “will never return to its previous status, especially for the US and Israel.” The statement came in response to renewed threats from President Trump on Sunday.