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Middle East crisis live: Vance says 60-day-period to reach final peace agreement starts today and US ‘isn’t giving up a cent’ to Iran

The EU’s foreign policy chief Kaja Kallas said she was representing the bloc’s position on the Middle East, after Israel announced it was severing diplomatic relations over allegations she had compared the country to apartheid South Africa. Israel’s foreign minister Gideon Sa’ar announced on X earlier on Thursday that he would sever all contact with Kallas over a Euractiv report that she had compared Israel to apartheid-era South Africa. Sa’ar said that she had for some time Kallas had been “acting obsessively and with blatant unfairness toward the state of Israel”, while accusing her of a “blood libel” over the alleged comments. Kallas told reporters she had made tens if not hundreds of statements on Israel and Gaza “and you see what I have been saying” but did not deny the report. “I cannot fight shadows all the time,” she said, asking reporters to refer to her public statements. She said she was representing the EU and “it is true we don’t always see eye to eye” with the Israeli government. The former Estonian prime minister has faced criticism inside the EU for not denying the remarks. EU leaders meeting in Brussels will express “grave concern” over the “deteriorating situation in Gaza and the West Bank, including the persistent and devastating humanitarian crisis in Gaza”, according to a draft summit communique due to be released on Friday. But the bloc has been unable to agree trade sanctions against Israel. Under growing pressure to take action, Kallas announced on Monday that she would ask for “a list of options for possible trade measures”, including stopping commerce from occupied territories. EU diplomats say it remains unclear whether the bloc can find a majority to pass sanctions on Israel.

Iran peace deal makes clear how far US has been forced to retreat since 2025

Only a man with an unparalleled ignorance of history such as Donald Trump would have signed America’s peace treaty with Iran at Versailles, the byword for national humiliation. And only a man with an impish sense of humour such as Emmanuel Macron would have suggested it. It is easy to cast Trump in the role of the humiliated and hurt German count Ulrich von Brockdorff-Rantzau. The treaty of Versailles, after all, was based on 14 points, just as the memorandum of understanding has 14 clauses. But the memorandum is not a full-scale surrender document; it is an admission that America could not achieve what it sought through war. If the memorandum, taken with Trump’s remarks at his hour-long press conference at the G7, is compared with a document the Americans tabled in 2025, it is possible to see how far the US has been forced to retreat. Red line after red line has been erased. The US tabled the 2025 document immediately before Israel, with US support, began the 12-day war culminating in the bombing of Iran’s nuclear sites. Under its terms, Iran was to have no domestic enrichment capabilities beyond the limited enrichment for medical and agricultural needs; all nuclear supply would be imported from outside Iran; all enriched uranium stockpiles would be shipped out of Iran immediately upon signing the agreement; all enriched stockpile material would be downblended to 3.67%; Iran would not build any new enrichment facilities; and Iran would dismantle all programmes capable of uranium conversion. Instead, a consortium including Iran, the US and the Gulf states was to undertake enrichment outside Iran. At Évian for the G7 meeting, however, Trump conceded Iran had a right to continue enrich uranium, saying it could not be excluded because other countries in the region had nuclear programmes. He said there was no great rush to dismantle or dilute the stockpile of highly enriched uranium, and US officials acknowledged that this stockpile could be diluted under IAEA watch inside Iran, so long as it was diluted to 3.67%. In practice, for the immediate waiver on oil exports to work, waivers will need to be issued on associated services including banking transactions, insurance and transportation. Miad Maleki, a former US Treasury official and a senior fellow at the Foundation for Defense of Democracies thinktank, said broadening authorisation to financial transactions would crack the core architecture of US oil and financial sanctions against Iran, arguably the most powerful economic leverage the US holds over the regime outside the naval blockade. Wider sanctions relief, which will not be offered until the nuclear negotiations are completed to mutual satisfaction, would cover primary and secondary sanctions as well as UN sanctions. If this happened, it would represent the biggest recasting of US-Iran relations since the Iranian revolution in 1979. What is worse from the US perspective is that all these concessions have been made to try to secure the reopening of the strait of Hormuz, which was open before the war, but even that may not be achieved. The memorandum text shows that free navigation of the strait could end after 60 days, at which point Iran will conduct dialogue with Oman to define the future administration and maritime services in the strait in discussion with other Gulf states. Finally, there is a proposed $350bn Iran reconstruction fund that the US has said it will create but will not contribute to. For that amount of money – the equivalent of the financial losses Iran has suffered – to be raised, the Gulf states would have to be deeply forgiving to a country that has just bombed their hotels and airbases and frozen their economies. Nothing, even the unfreezing of the $24bn Iranian assets abroad, is likely to do much to ease Iran’s acute economies woes. As to whether the deal is better or worse than Barack Obama’s 2015 nuclear deal, many of those involved in the talks say it is like comparing apples and oranges. The context is different, partly because Iran’s nuclear sites have been so damaged. More importantly, the 2015 deal was a fully fledged arms control document. The memorandum is at best a document that sets the stage for another negotiation that could end up in a stalemate or an agreement closely resembling the 2015 deal. Apart from the Iranian reiteration that it does not seek a nuclear weapon, the scope of the nuclear talks is left entirely open. The memorandum’s language is not even as strong as the 2015 agreement where Iran reaffirmed that “under no circumstances will Iran ever seek, develop or acquire nuclear weapons”. A denial of intent is irrelevant. It is the method of verification that matters, and on that the US is no further than before. So why has he struck the deal? Trump was very frank on Wednesday: the riskof a worldwide recession and oil reserves running out in a matter of weeks. He said: “The one president I did not want to be was the late, great Herbert Hoover,” referring to the president blamed for the Great Depression that wiped out savings and pitched millions into poverty. “I didn’t want to see economic catastrophe. If you kept this going, that could have happened.”

‘If Ukraine burns, your Moscow will burn,’ Zelenskyy warns after overnight strikes in Russia – as it happened

… and on that note, it’s a wrap for today! We will catch up with the overnight developments at the EU summit first thing tomorrow. Here is your summary of the day: Ukraine’s president Volodymyr Zelenskyy has warned that “if Ukraine burns, your Moscow will burn” (12:44) as he ramped up his rhetoric after overnight drone strikes on the Russian capital (9:55, 11:41, 15:00). Zelenskyy is attending the European Council’s meeting in Brussels tonight, discussing the next steps in the EU’s support for Ukraine and its prospective membership of the bloc (16:46, 16:54, 17:14). Earlier today, The US secretary of defence Pete Hegseth warned that “Nato has been a paper tiger and a one-way street” (9:55), as he delivered another blistering criticism of the European allies, blaming them for becoming “a dependency of the United States” (9:55) and “free riding” (9:55). Hegseth said that the refusal of some Nato allies to support the US forces in Iran strikes was “shameful” (10:00), as he announced plans for a review of US posture in Europe (10:05). Poland and Lithuania are among countries that hope to attract permanent US military presence on its territory as part of the review (15:39, 16:46). If you have any tips, comments or suggestions, email me at jakub.krupa@theguardian.com. I am also on Bluesky at @jakubkrupa.bsky.social and on X at @jakubkrupa.

Border Force officer and Hong Kong trade official jailed for spying for China

A UK Border Force officer and a Hong Kong trade official based in London have been jailed for spying for China in the first such conviction in British criminal history. Peter Wai, who conducted “shadow policing” operations on Chinese dissidents in the UK, was sentenced to 10 years, while his handler, Bill Yuen, received an eight-year term. After a two-month trial at the Old Bailey, the pair were convicted under the National Security Act of assisting a foreign intelligence service. Wai, 41, a Border Force officer at Heathrow airport who previously served in the Metropolitan police and as a special constable in the City of London police, was also convicted of misconduct in a public office over his use of a Home Office computer system to acquire details about his targets. The jury heard that Yuen, 66, a senior manager at the Hong Kong Economic and Trade Office, had taken over the handling of Wai shortly after they met in 2021 to conduct surveillance on dissidents. In a televised sentencing, Mrs Justice Cheema-Grubb said the defendants’ actions were “deliberate, concerted and serious”. They had caused “real and significant” harm, leaving those targeted in fear and distress, the judge said. She described Wai’s attitude towards his misconduct as “arrogant”, saying he had a “sense of entitlement” to do as he pleased. The case is one of the first to be prosecuted under the National Security Act. In her sentencing remarks, Cheema-Grubb said: “The offence of which you have been convicted is a grave one. Parliament has enacted the National Security Act in response to the growing reality that the UK now faces persistent, active and often clandestine interference by foreign state actors. “Modern foreign intelligence activity is not confined to orthodox espionage and may take the form of surveillance and information gathering about dissidents. Conduct of this kind threatens not only the individual victims but the sovereignty of the state and public confidence in institutions and the safety that this jurisdiction must afford to those lawfully present here.” She said that she had “no doubt” that the two men’s criminal activities contributed to the “fear, insecurity and distress for those targeted”. The Chinese embassy has said the case was an abuse of law designed to embolden anti-China elements “bent on destabilising Hong Kong”. The judge told the court she was unable to take into account evidence heard of the men’s spying before the law came into force in December 2023. The targets of what the judge described as a “shadow policing” operation included Nathan Law, an exiled politician who was the subject of several spying operations, and a second young activist in the UK whose family was being persecuted in mainland China. Wai also infiltrated Hong Kong pro-democracy groups and was instructed to gather information on politicians, including the former Tory leader Iain Duncan Smith and the peer Helena Kennedy. Yuen, Wai and a third British national, Matthew Trickett, were arrested with seven others in May 2024 after a failed break-in of a flat in Pontefract, West Yorkshire, that belonged to Monica Kwong, a personal assistant who had fled Hong Kong in 2023 after being accused of defrauding her employer out of £16m. The seven others arrested, who had recently arrived in the UK, fled the country after being released. The police did not have the interpretation resources to analyse the 200 devices that were seized during the arrest in order to charge them. Yuen and Wai were charged alongside Trickett, 37, an immigration enforcement officer and former Royal Marine. Trickett was found dead “by his own hand”, the judge said, in a park in Maidenhead, Berkshire, shortly after he was bailed. Helen Flanagan, the head of Counter Terrorism Policing London, which led the investigation, said: “Wai and Yuen were targeting pro-democracy campaigners here in the UK and sending highly sensitive details about them and their families to the Hong Kong authorities. “Our investigation, along with the convictions and sentences show how seriously this kind of activity is taken in the UK and that it will not be tolerated. It should also serve as a warning to anyone else who might consider doing similar that it is simply not worth it and that when you are caught, you will likely face a lengthy prison sentence.” Flanagan added that she hoped the sentencing “reassures those living in the UK who may be concerned about being targeted by any foreign state, that we will take action to stop this from happening and that we will do everything we can to help keep them safe”. Wai, who described Chinese dissidents as “cockroaches”, worked as a frontline uniformed officer with the Met based in Hounslow between February 2015 and April 2019 when he resigned. At the time, he was under investigation for misconduct after he told a supervisor that he had used his deceased grandfather’s address on a loan application to avoid tax. He had also accessed police records as a favour for friends, but police said there was no evidence he had used its database for spying. Despite the misconduct investigation being held on his files, Wai was later allowed to join the City of London police as a volunteer constable. Wai, who has also served in the Royal Navy, was sentenced to six years for assisting a foreign intelligence service and four additional years for misconduct in public office. A City of London police spokesperson said: “After Wai was arrested, we carried out an extensive review of his time as a special constable, despite assurances this position was not used in his offending. “Our checks concluded no live misconduct on Wai’s file when vetting was granted. “Despite his sentence today, Wai is still subject to an accelerated misconduct hearing related to his role as a special constable. “Our vetting procedures have improved since 2019 and we regularly review our processes in line with national guidance to ensure they are as robust as possible.”

Choppy waters ahead as Iceland gets ready for its own EU referendum

As the UK marks the tenth anniversary of its fateful Brexit referendum next Tuesday, Iceland is fast approaching its moment of truth about the EU – albeit from the opposite direction. On 29 August, Icelanders will be asked whether or not to they want to come back to the table with Brussels for negotiations about joining the EU. Iceland originally applied in 2009 after the financial crash, but pulled out of talks in 2013 saying it couldn’t go any further without a referendum. Now, after more than a decade on hold, membership talks are back on the agenda. When I met Iceland’s youngest ever prime minister, Kristrún Frostadóttir, last year she said she expected a referendum in 2027 as a “necessary step forward”. But that was before Donald Trump’s threats to invade Iceland’s closest neighbour Greenland. Iceland’s government, no doubt driven by the sudden geopolitical focus on the Arctic, announced that the referendum would be brought forward. While fear of invasion by a US president who appears to have difficulties distinguishing between Iceland and Greenland, has convinced some Icelanders of the need to join the EU, the island is divided. And on both sides of the debate, Brexit has become a watchword. For the pro-EU camp, British Leave campaign misinformation and the sense that the UK hasn’t exactly flourished since its exit from the EU are evidence for why the Nordic country should do the opposite. “I am fearing that we will face a Brexit moment,” Iceland’s pro-European foreign minister, Þorgerður Katrín Gunnarsdóttir, told me recently, referring to the disputed claims used by the leave campaign in Britain for how much money the UK sent to the EU. Brexit, she said, “should be an example of how not to run a campaign.” In the Eurosceptic camp the UK’s struggles to leave on its terms are presented as very good reasons not to join. “The EU wanted to make Britain’s departure as painful as possible,” Haraldur Ólafsson, from anti-EU group Heimssýn, told the Reykjavík Grapevine. “What is lost in one day can take many hundreds of years to get back.” *** ‘The loudest voices are probably the most extreme’ While public debate over the issue is starting to gather momentum, polls show that the pro-EU campaign has a lot of work to do to convince voters. Iceland, like Norway, is already a member of the European Economic Area (EEA) as well as the Schengen passport-free travel area. But a recent Gallup poll found 54% opposed joining the EU and 46% in favour. Another poll found that 53% would vote yes to resuming talks and 47% said no. Even if Icelanders vote yes they will, in contrast to the UK experience, be given a second referendum on whether or not to accept any terms of entry negotiators return with. “Of course the biggest question is always about the fisheries, but the EU has hinted that there could be an exemption for Iceland in that regard,” Freyja Steingrímsdóttir, executive director of the Association of Icelandic Journalists told me. Fishing is of phenomenal value to Iceland: the total value of fisheries assets for 2023 were put at 1,059 bn Icelandic Króna (about €7.3bn). The other big discussion point is the euro, Steingrímsdóttir stressed. “Iceland has a history of high inflation and high interest rates and a very unpredictable economy and probably more Icelanders would like to join the eurozone than actually the EU.” While the question in August’s referendum is in some ways hypothetical, the financial and emotional cost of voting in favour is very real. Hulda Þórisdóttir, a politics professor at the University of Iceland, says this is already shaping up to be a very contentious referendum that is far more complicated than a left v right divide. There is, she says, support for the EU on both sides of the political spectrum. “The loudest voices are probably the most extreme voices,” she tells me. “The vast majority of ordinary people who are trying to weigh the pros and cons may be feeling a little bit lacking in good information.” And then there are the domestic and international forces at play – in tandem with the election-altering potential of AI tools. As experts have warned, Iceland may struggle to ensure that voters have clear and correct information about the vote. In addition to fishing, the arguments against joining the EU include agriculture, fears about maintaining the high living standards of a progressive country – a world leader on equality – and Iceland’s relationship with the US. *** ‘This idea of a hard fought independence is very much still alive’ The most emotive argument however, is arguably that of sovereignty, which is baked into the Icelandic sense of self. Recent events in Greenland have only reminded Icelanders of their potential vulnerability. “This idea of a hard fought independence is very much still alive with the Icelandic national soul,” says Hulda Þórisdóttir. Iceland only gained full independence from Denmark in 1944. But the argument works both ways. Pro-EU campaigners argue that only a strong alliance with like-minded European nations can strengthen Iceland’s sovereignty. A sense, says Þórisdóttir, that “we are alone at sea” if not inside the EU. Flying between Reykjavík and the Greenlandic capital Nuuk on a tiny plane being tossed around by the elements in January, it was difficult to think about anything other than quite how alone and at sea both islands are. Whether or not Icelanders vote to restart EU negotiations this summer, Brussels and continental Europe will remain – geographically at least – very far away. • To receive the complete version of This Is Europe in your inbox every Wednesday, please subscribe here.