Iran's decision to rebuff a 15-point peace proposal from US President Donald Trump and outline its own conditions for a ceasefire reflects growing confidence in its negotiating position after nearly four weeks of war, analysts say.

Despite US-Israeli airstrikes that have killed its top leaders and inflicted huge material damage, Iran's governing system remains in place and it retains the ability to fire missiles and drones at its neighbours and Israel.

KUALA LUMPUR, March 26 (Reuters) - Malaysia's Prime Minister Anwar Ibrahim said on Thursday he had spoken to the leaders of Iran, Egypt, Turkey and other regional countries and said Malaysian vessels were now being allowed to pass through the Strait of Hormuz.

Anwar in a televised address thanked Iran's president for allowing the passage of Malaysian ships.

"We are now in the process of releasing the Malaysian oil tankers and the workers involved so that they may continue their journey home," he said.

JERUSALEM/BEIRUT, March 26 (Reuters) - Israel has said it will seize a chunk of southern Lebanon to create a "buffer zone" against Hezbollah militants, stoking fears among Lebanese of Israeli military occupation that could deepen instability and stoke further displacement.

WHAT HAS ISRAEL DONE, AND WHAT IS IT PLANNING?

By Michele Kambas

LIMASSOL, Cyprus, March 26 (Rtrs) - The Iran conflict is causing a rise in tourist cancellations and a dive in new bookings in Cyprus and to a lesser extent other countries whose economies relyheavily on summer visitors.

The U.S. and Israel launched attacks on Iran on February 28, just as Cyprus's tourism industry was reopening after winter. Then on March 2, as Iran launched a series of counter-strikes, a drone struck a British naval base on the island, triggering a wave of touristcancellations.

By Olivia Le Poidevin

GENEVA, March 26 (Reuters) - The head of the World Trade Organization said on Thursday the multilateral system has fundamentally changed and that countries must look to the future to consider how to reform the global trade system.

"The world order and multilateral system we used to know has irrevocably changed. We will not get it back...We must look to the future," WTO Director-General Ngozi Okonjo-Iweala told delegates at the opening of the 14th WTO ministerial conference in Yaounde, Cameroon.

MOSCOW, March 26 (Reuters) - Russia is in contact with the United States about a new round of talks on a Ukraine peace settlement as soon as conditions allow, the Kremlin said on Thursday.

"We remain open, we are in contact with the Americans, and we are counting on holding the next round of talks as soon as circumstances permit," Kremlin spokesman Dmitry Peskov said.

Peskov rejected the thesis of a New York Times opinion piece that said the Iran war had caused President Vladimir Putin to lose interest in negotiating an end to the Ukraine conflict.

BRUSSELS, March 26 (Reuters) - NATO's European allies and Canada increased defence spending by 20% in 2025 compared to the previous year in real terms, alliance chief Mark Rutte said in his annual report published Thursday, urging NATO members to keep up the momentum.

"I expect Allies at the next NATO Summit in Ankara to show they are on a clear and credible path towards the 5% objective," he wrote, adding that "a strong transatlantic bond remains essential in an age of global uncertainty".

MOGADISHU, March 26 (Reuters) - Drivers of tuk‑tuk taxis in Somalia’s capital are abandoning their livelihoods as fuel prices surge, pushed up by disruptions to oil shipments linked to the Iran conflict.

With fares rising, passengers have dropped away and many drivers in Mogadishu say they can no longer keep their three-wheelers on the road.

ISLAMABAD, March 26 (Reuters) - Pakistan is continuing military operations against Afghanistan after the end of a temporary pause announced for the Islamic festival of Eid-al-Fitr, the spokesperson of Pakistan's foreign ministry said on Thursday.

Fighting between the allies-turned-foes started last month, with Kabul saying more than 400 people were killed in a Pakistani air strike on a drug rehabilitation centre in the Afghan capital last week before the neighbours suspended fighting.

March 26 (Reuters) - The Pentagon is weighing whether to redirect weapons originally meant for Ukraine to the Middle East, as the war in Iran strains supplies of some of the U.S. military's most critical munitions, the Washington Post reported Thursday, citing three people familiar with the matter.

The weapons that could be redirected include air defense interceptor missiles purchased through a NATO initiative launched last year, under which partner countries buy U.S. arms for Kyiv, the report said.