By Ariba Shahid, Parisa Hafezi, Saad Sayeed, Asif Shahzad and Humeyra Pamuk
ISLAMABAD/DUBAI/WASHINGTON April 13 (Reuters) - After a sleepless and at times tense night in Islamabad, Iranian and U.S. officials ended their highest-level talks in decades https://www.reuters.com/world/iran/ without a breakthrough, but 11 sources familiar with the negotiations said dialogue was still alive.
The weekend meeting to resolve the conflict between the U.S. and Iran nL1N40B090, held four days after last Tuesday's ceasefire announcement, was the first direct encounter between U.S. and Iranian officials in more than a decade and the most senior engagement since Iran's 1979 Islamic Revolution.
Inside Islamabad's luxury Serena Hotel, the talks unfolded across two separate wings and one common area — one for the U.S. side, one for the Iranians and one for trilateral meetings involving Pakistani mediators, operational staff told Reuters.
Among the slew of issues at stake nL6N40U01E was the Strait of Hormuz, a major transit point for global energy supplies nL4N40W08K that Iran has effectively blocked but the U.S. has vowed to reopen, as well as Iran's nuclear programme and international sanctions on Tehran.
Phones were not allowed in the main room, forcing delegates, including U.S. Vice President JD Vance and Iranian Parliamentary Speaker Mohammad Baqer Qalibaf, to step out during breaks to relay messages back home, two of the sources said.
"There was a strong hope in the middle of the talks that there would be a breakthrough and the two sides would reach an agreement. However, things changed within no time," a Pakistani government source said.
Another source involved in the talks said the parties came "very close" to an agreement and were "80% there", before running into decisions that could not be settled on the spot.
Two senior Iranian sources described the atmosphere as heavy and unfriendly, adding that while Pakistan tried to soften the mood, neither side showed any willingness to ease tensions.
AT ONE POINT, THE ATMOSPHERE BEGAN TO LIFT
Nevertheless the two Iranian sources said that by early Sunday morning the atmosphere had shown some improvement, and the possibility of a one-day extension began to take shape.
However, differences persisted. A U.S. source said the Iranians did not properly understand that the core U.S. aim was to have a deal that ensured Iran would never obtain a nuclear weapon. Among Iran's concerns was a distrust of U.S. intentions.
This account, based on sources who spoke on condition of anonymity due to the sensitivity of the matter, offers a first account of the internal dynamics of the meeting, how the mood in the room shifted, how talks ended after signs the meeting might be extended, and how further dialogue remains on the cards.
There was no immediate response from the Iranian government to a request for comment on the issues reported in this story.
On Monday U.S. President Donald Trump said Iran had "called this morning" and that "they'd like to work a deal." Reuters could not immediately verify the assertion.
A U.S. official, referring to Trump's comment, said there was continued engagement between the U.S. and Iran and forward motion on trying to get to an agreement.
Asked for comment, White House spokeswoman Olivia Wales said the U.S. position had never shifted in the Islamabad meeting.
"Iran can never have a nuclear weapon, and President Trump’s negotiating team stuck to this red line and many others. Engagement continues toward an agreement,” she said.
'UPS AND DOWNS'
A Middle East-based diplomat said conversations between mediators and the Americans have continued since Vance left Islamabad, while the source involved in the talks said Pakistan was still passing messages between Tehran and Washington.
"I want to tell you that a full effort is still on to resolve the issues," Pakistan's Prime Minister Shehbaz Sharif said on Monday.
Despite numerous obstacles to peace, both sides appear to have strong reasons to consider de-escalation.
The U.S. strikes appear unpopular at home and look unlikely to topple Iran's theocratic ruling system, while Tehran's strangling of energy supplies is hurting the global economy and pushing up inflation months before U.S. midterm elections.
Also, war damage to Iran's ailing economy nL8N40R0VH risks leaving the authorities there weaker internally just weeks after protests they were able to put down only with mass killings.
In Islamabad, the longtime foes had gathered to try to chart a path to a long-term settlement, after a Pakistan-brokered ceasefire paused six weeks of war that has killed thousands of people and disrupted the world's energy supplies.
Central to the dispute is a belief among Western countries and Israel that Iran wants a nuclear bomb. Iran denies seeking nuclear weapons.
A White House official said the U.S. wanted Iran to end all uranium enrichment, dismantle all major nuclear enrichment facilities, turn over its highly enriched uranium, accept a broader peace, agree a security framework that includes regional allies, end funding for regional proxies and fully open Hormuz, charging no tolls.
Iran’s demands included a guaranteed permanent ceasefire, assurances of no future strikes on Iran and its allies in the region, lifting of primary and secondary sanctions, unfreezing of all assets, recognition of its right to enrichment and continued control of Hormuz, Iranian sources have said.
Four of the 11 sources said that at times the dialogue appeared close to producing at least a framework understanding, but unraveled over Iran's nuclear programme, the Hormuz Strait nL1N40V06L and the amount of frozen assets Tehran wants access to.
The Iranian sources said most of the substantive exchanges in Islamabad were between Vance, Qalibaf and Iranian Foreign Minister Abbas Araqchi.
"There were ups and downs. There were tense moments. People left the room, and then came back," the security source said.
Pakistani representatives, including Army Chief Asim Munir, and Foreign Minister Ishaq Dar, moved between the sides through the night to keep things on track, five Pakistani sources said.
'HOW CAN WE TRUST YOU?'
The talks stretched for more than 20 hours with on-duty hotel staff eating, sleeping and working on site after undergoing expedited background checks, they said.
When discussions turned to guarantees, both non-aggression assurances and sanctions relief, the tone of the normally mild-mannered Araqchi grew sharper, the two Iranian sources said.
The sources quoted him as saying: “How can we trust you when, in the last Geneva meeting, you said the U.S. would not attack while diplomacy was under way?”
The U.S.-Israeli attack on Iran began two days after the two sides held a previous round of talks in Geneva.
In addition to differences over Hormuz, sanctions and other topics, the two sides also disagreed over the scope of any deal. While Washington focused on the nuclear file and Hormuz, Tehran wanted a broader understanding, according to two of the sources.
During one tense moment, raised voices could be heard outside the negotiating room before Munir and Dar called a tea break and moved the two sides back into separate rooms, the government source said.
'OUR FINAL AND BEST OFFER'
Toward the final stages of the discussions, which spilled into Sunday morning, the U.S. delegates were moving between the negotiating room and their private floor far more often than the Iranians, the senior Pakistani official said.
A U.S. source said the vice president came to the talks with the aim of making a deal and reaching a mutual understanding. The U.S. side has been wary of protracted negotiations with Iran, believing the Iranians are adept at delaying tactics and refusing to make concessions, the source said.
Despite the deadlock, when Vance appeared in front of reporters later to announce the talks had ended, his remarks suggested more exchanges of some kind might be in prospect.
"We leave here with a very simple proposal, a method of understanding that is our final and best offer," he said. "We'll see if the Iranians accept it."
(Reporting by Ariba Shahid, Mubasher Bukhari, Saad Sayeed and Asif Shahzad in Islamabad, Parisa Hafezi in Dubai, and Steve Holland and Humeyra Pamuk in Washington, Editing by William Maclean)
