U.S. President Donald Trump said on Monday he had ordered a five-day postponement of planned military strikes on Iranian power plants, signaling a potential de-escalation in a conflict now entering its fourth week.

In a post on his Truth Social platform, Trump said the decision followed what he described as “very good and productive” discussions with Iran over the past two days aimed at achieving a “complete and total resolution of hostilities in the Middle East.”

“Based on the tone and substance of these detailed and constructive talks, which will continue throughout the week, I have instructed the Department of Defense to postpone any and all military strikes against Iranian power plants and energy infrastructure for five days, subject to the success of ongoing meetings,” he said.

The move came just hours before a deadline Trump had set for potential action, after warning over the weekend that Iranian power facilities could be targeted if Tehran did not reopen the Strait of Hormuz to global shipping within 48 hours.

Iran, however, denied that any direct or indirect negotiations had taken place. The semi-official Fars News Agency reported that there had been no communication with Washington, citing a source who claimed Trump had backed down after being warned that Iran would retaliate by striking power plants across the region. Tehran has issued an immediate statement saying there has been “no direct or indirect contact” with the US president, with Foreign Minister Abbas Araghchi saying Trump was “buying time”.

A source familiar with Israeli military planning said Washington had kept Israel informed of its contacts with Tehran, adding that Israel was likely to follow the U.S. lead by suspending strikes on Iranian power plants and energy infrastructure. The office of Prime Minister Benjamin Netanyahu did not immediately respond to requests for comment.

Trump’s announcement had an immediate impact on global markets. Brent crude prices briefly fell by around 13%, dropping below $100 a barrel before recovering to about $105 by midday. U.S. stock futures, which had been declining earlier, rebounded sharply to post gains of more than 2%.

The crisis has centered on the Strait of Hormuz, a vital chokepoint through which roughly a fifth of the world’s oil and liquefied natural gas passes. Iran has effectively shut the passage, triggering widespread concern over global energy supplies.

Iran’s Islamic Revolutionary Guard Corps had warned earlier Monday that it would retaliate if the United States carried out strikes, threatening to target power plants in Israel and facilities supplying U.S. bases across the Gulf. Tehran also signaled it could escalate further by mining Gulf waters, potentially disrupting maritime traffic across the region.

The risk of attacks on energy infrastructure has heightened fears of widespread disruption, particularly in Gulf countries that rely heavily on electricity for desalination. Nations such as Bahrain and Qatar depend entirely on desalination for drinking water, while the United Arab Emirates and Saudi Arabia rely on it for the majority of their supply.

Fatih Birol, head of the International Energy Agency, said the unfolding energy crisis could surpass the combined impact of the oil shocks of the 1970s and the gas shortages triggered by Russia's invasion of Ukraine.

Despite the diplomatic signals, fighting on the ground has continued. The Israeli military said it launched a new wave of strikes on infrastructure in Tehran early Monday. Iranian media reported that six people were killed and 43 wounded in attacks on residential buildings in the western city of Khorramabad.

In southern Iran, a strike on Bushehr reportedly hit a meteorological facility, killing the head of the airport’s weather department. Footage released by the Iranian Red Crescent showed rescue teams pulling victims from a heavily damaged residential building in northern Tehran.

Across the Gulf, Saudi Arabia said two ballistic missiles were fired toward Riyadh, with one intercepted and the other landing in an uninhabited area.

The war, launched by the United States and Israel on February 28, has killed more than 2,000 people and sent shockwaves through global markets, driving up fuel prices and intensifying inflation concerns.

Behind the scenes, diplomatic efforts appear to be underway. A U.S. source told Axios that Turkey, Egypt, and Pakistan have been relaying messages between Washington and Tehran. Their foreign ministers have held separate discussions with U.S. envoy Steve Witkoff and Iranian Foreign Minister Abbas Araghchi.

“The mediation is ongoing and making progress,” a source familiar with the talks said. “The discussions focus on ending the war and resolving all outstanding issues. We hope to have answers soon.”