Updated at 6:54 a.m.
By Parisa Hafezi, Yomna Ehab and Humeyra Pamuk
DUBAI/WASHINGTON, June 15 (Reuters) – The U.S. and Iran said they had agreed terms to end their war and reopen the Strait of Hormuz, news that brought relief to markets although the pact may hinge on an end to hostilities in Lebanon and defers talks on Tehran’s nuclear program.
While still a framework, the deal marked the biggest breakthrough towards resolving the conflict that has killed thousands and upended energy markets since it began with joint U.S.-Israeli strikes on Iran in February.
“The Deal with the Islamic Republic of Iran is now complete,” U.S. President Donald Trump wrote on his Truth Social platform at around 5:30 p.m. in Washington (2130 GMT) on Sunday. His post came shortly after Pakistani Prime Minister Shehbaz Sharif, whose country has served as a mediator, announced a deal had been struck.
The memorandum of understanding is scheduled to be officially signed on Friday in Switzerland.
The precise terms were not immediately known. Sharif said in a post on X that the pact called for “the immediate and permanent termination of military operations on all fronts, including in Lebanon.”
Leaders of the Group of Seven wealthy nations are due to arrive at a French lakeside resort on Monday, where Trump will be pressed for details.
LEBANON HAS BEEN A STICKING POINT
While the U.S. and Iran had largely ceased hostilities as they engaged in weeks-long negotiations, Lebanon has suffered the deadliest spillover of the conflict. Some 1.2 million people have been uprooted by an Israeli offensive against the Iran-backed group Hezbollah, which opened fire on Israel in support of Tehran on March 2.
Lebanon has been a persistent sticking point in talks, with Israel and Hezbollah ignoring calls from Trump and others to stop their attacks on each other, while Iran made a full ceasefire in Lebanon one of its demands.
The secretariat of Iran’s Supreme National Security Council said war and military operations on all fronts, including Lebanon, would end permanently starting on Monday night.
Iran’s Foreign Minister Abbas Araqchi said there must be a complete halt to Israeli attacks against Lebanon and wrote on Telegram that the U.S. bears responsibility for implementing the framework deal.
Hezbollah has not yet publicly commented on the U.S.-Iran deal, but Lebanese and foreign security sources told Reuters that the group had last fired at Israel before midnight on Sunday night and had not launched operations since then.
The pace of Israeli attacks has decreased dramatically, they added.
Before the memorandum was announced, Trump said he would bring peace to the region, including Lebanon, and that there should be no more Israeli attacks on Lebanon or Hezbollah attacks on Israel.
Israeli Prime Minister Benjamin Netanyahu has yet to respond publicly to the U.S.-Iran agreement.
But Defense Minister Israel Katz said that Israel would oppose any pressure to withdraw its forces from areas it is occupying in southern Lebanon.
STRAIT TO REOPEN
Trump said the Strait of Hormuz, a major shipping route for global oil and gas supplies that Iran has effectively shut down for months, would open on Friday, and that he had ordered the end of the U.S. blockade of Iranian ports.
“Ships of the World, start your engines. Let the oil flow!” Trump wrote.
Oil prices fell on the news, though shippers remained cautious and ensuring the waterway is clear of mines could take weeks. Brent crude futures fell some 5% on Monday while stock markets jumped.
The war has become a political liability at home for Trump and his fellow Republicans in Congress, with Americans deeply frustrated by rising gas prices ahead of November’s midterm elections. But Trump has also faced pressure from members of his own party who insist that Iran’s nuclear program must be completely shut down.
During his first term, Trump withdrew the U.S. from a 2015 multilateral Iran deal, negotiated by Democratic President Barack Obama, that lifted sanctions on Tehran in exchange for limits on its nuclear program and international inspections.
Iran responded by ramping up its enrichment of uranium, producing more than 400 kg (around 900 pounds) of material at close to bomb-grade purity.
RELEASE OF FROZEN ASSETS
The agreement was sealed despite an Israeli strike on Lebanon on Sunday that drew criticism from both Iran and Trump.
Iran’s deputy foreign minister, Kazem Gharibabadi, said a more expansive agreement on the wider conflict would be negotiated during a 60-day ceasefire period, including sanctions relief for Iran.
The fate of Tehran’s nuclear program, another thorny issue, will also be addressed in those later talks, sources previously told Reuters.
Leaders outside the Middle East welcomed the announcement.
In a joint statement, Britain, Germany, France and Italy said they were prepared to lift sanctions on Iran in response to “clear, verifiable steps” to limit its nuclear program.
China also welcomed the deal.
Before the deal was announced, a senior Iranian official told Reuters that, under the terms of the draft, the U.S. would agree to release $25 billion of frozen Iranian assets.
A U.S. official, also speaking before the announcement, said the agreement would ultimately lead to the dismantling of Iran’s nuclear program, with its stockpile of highly enriched uranium to be destroyed and removed. The senior Iranian official said the draft deal would allow Iran, which denies seeking a nuclear bomb, to dilute its enriched uranium inside the country.
(Reporting by Reuters bureaus; Writing by Lincoln Feast, Joseph Ax, Alexandra Hudson; Editing by Stephen Coates, Aidan Lewis)
By Kentaro Okasaka, Jeslyn Lerh, Emily Chow and Stine Jacobsen
June 15 (Reuters) – Shippers in Asia and Europe said confidence in resuming transit through the Strait of Hormuz could take weeks to rebuild and navigation will only restart once safety is assured, after the U.S. and Iran agreed on a framework deal to reopen the waterway.
U.S. and Iranian officials are expected to sign a memorandum of understanding to end their war, halt the U.S. blockade of Iran and reopen the strait on Friday. Global oil prices fell about 5% on Monday in response.
Shippers have welcomed news of the deal, but are still waiting for more details, including mine clearance in the strait.
“Initial reactions in the shipping industry are muted. AIS data shows no wave of ships heading towards Hormuz this morning,” Jyske Bank analyst Haider Anjum said in a note to clients.
“The shipping companies probably want to wait until it is clear that the agreement holds, as we have already had Hormuz ‘open’ for a very short time twice before,” he added.
WAR LARGELY STOPPED SHIPPING THROUGH STRAIT
The U.S.-Israeli war with Iran that began on February 28 has largely stopped shipping through the strait, the transit route for roughly a fifth of the world’s oil and liquefied natural gas supply, along with vital products such as aluminium and urea.
While traffic through the waterway remains limited, India’s Petronet sent the LNG tanker Disha through Hormuz on Monday, the only visible shipment so far, data from Kpler and LSEG showed.
The tanker picked up its cargo at Qatar’s Ras Laffan on March 1-2 and had been west of the strait since, with the Dahej terminal in India its eventual destination, according to the data. Petronet did not respond to a Reuters request for comment.
Shipping association BIMCO said on Monday it still considers transits through the strait highly risky, with mines remaining a key concern.
“The next step is for shipowners to be reassured that transiting the Strait of Hormuz is not only permitted but also safe,” said Jakob Larsen, BIMCO’s chief safety and security officer.
CONCRETE INFORMATION AWAITED
A spokesperson for the Japanese Shipowners’ Association said on Monday that while the group welcomed the peace agreement, it wanted to “wait a little longer for more concrete information”.
“Given the situation, we cannot simply say, ‘Right then, let’s go’ based on news of the agreement alone,” he added.
Nippon Yusen, the country’s biggest shipper, said it hoped operations would return to normal as soon as possible. Mitsui O.S.K. Lines said it would only resume navigation once safety has been fully confirmed.
German shipowners’ association VDR said on Monday it was “cautiously optimistic” about whether the U.S.-Iran deal could reopen the Strait of Hormuz, while German shipper Hapag-Lloyd said it hoped that vessels will be able to cross the strait this week.
MANY TANKERS STILL STUCK INSIDE GULF
An estimated 155 tankers, carrying oil and chemicals, were in the Mideast Gulf area as of June 15, shiptracking data from Kpler showed, down from 201 tankers at the end of May.
Oil Brokerage’s estimate stood at 215 tankers. Under unrestricted navigation, the traffic pile-up on either side can be resolved in 8-10 days, said Anoop Singh, Oil Brokerage’s global head of shipping research.
While tankers have been quietly moving barrels along Oman’s coast for weeks, sailing dark with U.S. navy support, it would require weeks of de-mining and normalization of insurance rates for resumption of meaningful traffic, said David Jorbenaze, global oil market leader at ICIS.
“Returning to full pre-conflict volumes is realistically a 2027 story, and only if the agreement holds without incident and production recovers at pace,” he added.
(Reporting by Emily Chow, Jeslyn Lerh and Trixie Yap in Singapore, Nidhi Verma in New Delhi, Kentaro Okasaka and Maki Shiraki in Tokyo, Stine Jacobsen in Copenhagen; Additional reporting by Ludwig Berger in Frankfurt, Marie Mannes in Stockholm, Anushree Mukherjee in Bangalore; Writing by Florence Tan and Nerijus Adomaitis; Editing by Tom Hogue and Jan Harvey)
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