Once a symbol of cultural prestige, Iran's handmade rugs are no longer selling as fast as they once did, as sanctions weigh on an already troubled economy and buyers' tastes change.

Commanding more than $2 billion in export revenues in its heyday of the early 1990s, the industry now struggles to scrape together around $40 million, marking a dramatic collapse of more than 95 percent.

The reimposition of sanctions in 2018 meant the age-old craft lost what was traditionally its largest market -- the United States.

One year after a devastating war with Israel dealt massive blows to Lebanon's Hezbollah, the Iran-backed movement is still managing to pay its fighters and fund its social services.

The killing of its longtime leader Hassan Nasrallah in an Israeli strike on September 27 last year left the Shiite group reeling, yet it has maintained cohesion under his successor, Naim Qassem.

As the group faces mounting pressure to disarm, the United States has also sought to cripple its finances.

By Humeyra Pamuk

NEW YORK (Reuters) -Syria and Israel are close to striking a "de-escalation" agreement in which Israel will stop its attacks while Syria will agree to not move any machinery or heavy equipment near the Israeli border, a senior U.S. envoy said on Tuesday.

Speaking to reporters on the sidelines of U.N. General Assembly meetings in New York, U.S. Special Envoy for Syria Tom Barrack said the agreement would serve as the first step towards the security deal that the two countries have been negotiating.

By Matt Spetalnick

WASHINGTON (Reuters) -Growing international frustration with Washington over the war in Gaza spilled into the open at the U.N. General Assembly this week, with U.S. allies recognizing a Palestinian state in a major test for President Donald Trump's Middle East policy.

After promising at the start of his second term to quickly end the war between Israel and Hamas, Trump now looks increasingly like a bystander as Israeli forces escalate their onslaught in the Palestinian enclave and he remains reluctant to rein in Washington's closest regional ally.

Syria's new leader warned Tuesday that the Middle East would face a new round of tumult unless Israel reaches a security agreement with his transitional government that preserves sovereignty.

President Ahmed al-Sharaa, a former jihadist whose forces swept out longtime ruler Bashar al-Assad in December, is making a landmark visit to New York for the United Nations General Assembly.

Sharaa again voiced hope for a security agreement with Israel, which has unleashed massive attacks as it takes advantage of a moment of weakness in its historic adversary.

By Gram Slattery and Kanishka Singh

UNITED NATIONS/ WASHINGTON (Reuters) -French President Emmanuel Macron said on Tuesday recognizing the state of Palestine does not amount to forgetting the October 2023 Hamas attack, with the French leader making his comments as he sat next to President Donald Trump in a bilateral meeting.

WHY IT'S IMPORTANT

Trump has condemned moves by Western powers and U.S. allies, including France, to recognize a Palestinian state, saying such steps would reward "horrible atrocities" by Hamas militants.

KEY QUOTES

Qatar's ruler told world leaders Tuesday his country was continuing with its diplomatic efforts to broker an end to the war in Gaza despite Israel's strikes on targets in the Gulf country.

Emir Sheikh Tamim bin Hamad Al-Thani condemned at the UN Israel's "treacherous" strike on his country targeting Hamas leaders in the heart of a Doha residential community where they maintained a liaison office.

Qatar, along with Egypt and Washington, had led efforts to broker a comprehensive ceasefire between Israel and Hamas, with several rounds of fruitless diplomacy executed in Doha.

(Reuters) -If U.S. President Donald Trump really wants to win the Nobel Peace Prize, he needs to stop the war in Gaza, French President Emmanuel Macron said on Tuesday.

Speaking to France's BFM TV from New York, Macron said that only Trump has the power to put pressure on Israel to end the war.

By John Irish and Parisa Hafezi

UNITED NATIONS (Reuters) -Iran and European powers have agreed to continue talks about Tehran's disputed nuclear programme, the Iranian foreign ministry said on Tuesday, after a meeting to try to strike a last-ditch deal to avert the reimposition of U.N. sanctions.

The foreign ministers of France, Britain and Germany - the so-called E3 - along with the EU's foreign policy chief held talks with their Iranian counterpart on the sidelines of the U.N. General Assembly.

US President Donald Trump could only win the Nobel Peace Prize if he stopped the conflict between Israel and the Palestinians over Gaza, French President Emmanuel Macron said on Tuesday.

Macron told BFMTV in an interview from the sidelines of the UN General Assembly in New York that "there is only one person who could do something in the current situation -- the American president."