Key facts
- The US and Iran have reached a preliminary agreement to resolve a conflict.
- The deal aims to reopen the Strait of Hormuz, a critical oil chokepoint.
- A memorandum of understanding (MOU) was signed on June 14.
- The initial pact includes a 60-day negotiation period for sanctions and Iran's nuclear program.
- The agreement mandates an immediate and permanent termination of military operations.
- Oil prices dropped to their lowest level in three months following the announcement.
The United States and Iran have reached a preliminary agreement to end a conflict that had closed the Strait of Hormuz and impacted global oil markets. Mediated by Pakistani Prime Minister Shehbaz Sharif, the deal, signed on June 14, includes a memorandum of understanding (MOU) that mandates an immediate and permanent cessation of military operations.
The initial pact will reopen the Strait of Hormuz, a critical chokepoint for global energy supply. Following the signing ceremony, scheduled for Friday in Geneva, both nations will enter a 60-day negotiation period to finalize a comprehensive deal addressing sanctions and Iran's nuclear program. The MOU also outlines the removal of the U.S. naval blockade within 30 days and a broader withdrawal of U.S. forces after a final agreement is reached.
President Donald Trump celebrated the agreement, stating, "Ships of the World, start your engines. Let the oil flow!" In response to the news, oil prices fell to their lowest level in three months. However, experts express caution, noting that past negotiations have failed to bridge significant gaps, particularly concerning Iran's nuclear activities. Steven Cook, a senior fellow at the Council on Foreign Relations, commented that negotiations on outstanding issues will likely be "long and difficult."