After 21 hours of high-stakes negotiation, the United States Vice President JD Vance left Islamabad on Sunday, as Iran and the US failed to reach an agreement.

The stalled negotiations have put the fate of the fragile ceasefire to the test, with the Strait of Hormuz issue unresolved.

In his speech, Vance said that he had handed over a take-it-or-leave-it proposal to the Iranian delegation to forgo their nuclear programme, which they rejected.

Iran, on the other hand, blamed Washington for the breakdown in peace negotiations, saying that the US demands were excessive.

A spokesperson for Iran's foreign ministry said the talks were conducted in an atmosphere of mistrust. He said, "It is natural that we shouldn't have expected to reach an agreement in just one session."

According to the reports, both parties reached a deadlock on issues like nuclear programme, control of the Strait of Hormuz, and frozen Iranian capital, among others.

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What's next? War or more talks

The White House officials have said that US President Donald Trump would announce the administration's next move on Iran, according to a report by the New York Times.

The temporary ceasefire is set to come to an end on April 21. The stalled negotiation indicates that the regional tension in West Asia may once again heat up.

After the talks, Trump shared an article on Truth Social, which highlighted the possibility of a naval blockade in the wake of the failed talks.

The article suggested that the US blockade could reduce Iranian influence in the Strait, which would in turn tighten economic pressure.

In such an eventuality, energy supplies, gas shortages, and, largely, the global economy would be impacted significantly.

However, as global diplomacy works, back-channel talks are likely to continue, especially as both countries have officially accepted mediation. It's a necessity for both Trump and the Iranian regime to end the conflict but both sides are weighing their options to ensure they make the most before consensus is reached.

Michael Kugelman, Senior Fellow at Atlantic Council, South Asia, said the US wants to exit the war for domestic political reasons, and so more talks could come.

Taking to X, he said, "The US, for domestic political reasons, wants a deal that enables it to exit the war. That such a senior group flew all the way to Pak shows the US commitment. Despite Vance’s comments, this likely isn’t over. More talks could come-but unclear if they’ll be in Pak or elsewhere".

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What failure of talks suggest?

As reports suggest, the United States has rejected Iran's demand of compensation but has agreed to lift over two decades-old sanctions. However, this would take time. Iran, on the other hand, has rejected the US demands to give up on enriching Uranium, which is being seen as Tehran's unwillingness to forgo its nuclear programme. Moreover, the Islamic regime is also firm on maintaining its strict control over the Strait of Hormuz.

According to the NYT report, the Islamabad talks proceeded on the same lines as in Geneva before the wr started on February 28.

It suggests that either side is firm in their consideration of being the victors of the war and has become more firm in leaving space for compromise.