Markets have welcomed an interim agreement between the United States and Iran aimed at ending a nearly four-month war that has caused a global economic downturn. Stocks soared on Monday as oil prices and bond yields fell.
US President Donald Trump said the deal had not yet been signed, but the two countries had agreed to a “memorandum of understanding” and had withdrawn militarily, and the vital Strait of Hormuz would be reopened as part of the deal.
Here’s what we know about what has been agreed so far and what could happen next.
Has Iran signed a peace deal?
Iran’s Deputy Foreign Minister Kazem Ghalibabadi said the document has been completed and is expected to be signed in Geneva, Switzerland, on Friday. It added: “A permanent and immediate end to the war has been declared on all fronts.” President Trump also said the US naval blockade against Iran would be ended.
The text of the memorandum had not yet been made public as of Monday. What we know comes from the statements of those involved in the negotiations.
Is the Strait of Hormuz open?
President Trump’s response to the Truth Social agreement focused almost entirely on the Strait of Hormuz, saying it would reopen without charge.
He posted on Truth Social: “I hereby fully approve the free opening of the Strait of Hormuz, and at the same time approve the immediate lifting of the US naval blockade. Ships of the world, start your engines. Let the oil flow!”
He later posted that the strait would be opened “for mine clearance purposes upon signing the deal on Friday.”
Iranian state news agency Mehr later reported that the reopening of the strait would be subject to “Iranian arrangements.”
Qatar said on Monday it welcomed the agreement between the United States and Iran as it “addresses outstanding issues between the two countries, including ensuring freedom of navigation in the Strait of Hormuz.”
Has the war ended?
The United States and Iran have suspended hostilities for the time being. The agreement extends the ceasefire for 60 days to create a framework for future negotiations over Iran’s nuclear program, sanctions and regional security.
These negotiations could lead to a final peace agreement. Ghalibabadi said the 60-day nuclear negotiations cannot begin unless the United States releases billions of dollars in frozen Iranian funds. The United States rejected that claim.
President Trump reiterated on Sunday that “Iran will never have nuclear weapons.” He also told the New York Times that the United States could attack Iran again if negotiations fail to reach a solution to Iran’s nuclear ambitions.
“The threat of renewed conflict will remain for months to come,” Torbjorn Soltvedt, chief Middle East analyst at risk intelligence firm Verisk Maplecroft, told CNBC. “The threat of renewed conflict will remain for months to come. Pushing the most difficult issues to later negotiations prolongs the uncertainty and leaves the underlying conflict unresolved.”
Importantly, Israel is not a party to this agreement. Lebanon has been in a state of war since the first attack on February 28th. Attacks on Lebanese targets sometimes undermine the ceasefire. Earlier, Gharibabadi said his announced “permanent and immediate end to the war” included Lebanon. It is unclear whether Israel will accept it.
Israeli Defense Minister Yisrael Katz said in a statement on Monday that the IDF would remain in so-called “safe zones” in Lebanon, Gaza and Syria, adding that Israel would retaliate if Iran attacked the country in response to events in Lebanon.
Who will be able to attend the signing ceremony in Geneva?
The Iranian government has not released a list of those in attendance, but the list could give an indication of the support for the deal among some in Iran’s political establishment.
The country’s Foreign Minister Abbas Araghchi is a key figure in the Pakistan-brokered negotiations and is most likely to be Iran’s senior signatory.
If Parliament Speaker Mohammad Berger Ghalibaf attends, it could signal support from Iran’s conservative and security forces. The presence of senior security chief Mohammad Bagher Zolgadol would signal approval from Iran’s supreme leader. However, Zolgadol is subject to sanctions.
No official U.S. delegation has been confirmed.
According to reports, Vice President J.D. Vance is considering holding a signing ceremony if an agreement is reached. President Trump may also make a direct visit from the G7 summit in Evian, France. Steve Witkoff, the White House special envoy who has led most of the negotiations between the United States and Iran, is likely to participate.
This conflict involves many more parties and countries than just the United States and Iran.
One of the most important signals will be whether Saudi Arabia and the UAE, who are embroiled in a war, will send ministerial representatives. This would suggest that the agreement has broader support from regional countries.
Israeli officials are not expected to attend.
