Kashmir Impulse Desk

Washington, June 18

US President Donald Trump and Iranian President Masoud Pezeshkian signed an interim agreement on Wednesday to halt hostilities and launch negotiations over Tehran’s nuclear programme, while Washington agreed to ease sanctions and allow Iran to resume unrestricted oil exports in one of the most significant concessions offered to the Islamic Republic in years.

The memorandum of understanding, brokered with Pakistan’s help, takes immediate effect and sets 60 days for negotiations aimed at reaching a broader agreement on Iran’s nuclear activities and regional security issues, according to details released by US officials and Iranian state media.

Pakistani Prime Minister Shehbaz Sharif, whose government helped mediate contacts between Washington and Tehran, said in a post on X that the accord had been signed by both leaders and had entered into force immediately.

The agreement marks the first formal understanding between the two countries since a conflict that began on Feb. 28 and drew in regional powers, disrupted global energy supplies and raised fears of a wider Middle East war.

Despite repeated references by Trump to ambitions ranging from dismantling Iran’s nuclear programme to curbing its regional influence, the interim accord largely restores conditions that existed before the conflict while leaving many of the most contentious issues unresolved.

“This was not easy,” Trump said before signing the document during a dinner with French President Emmanuel Macron at the Palace of Versailles, according to video released on social media.

Video posted by White House officials showed Trump signing a paper copy of the agreement and handing it to Secretary of State Marco Rubio as those present applauded.

In Tehran, state-run IRNA published photographs showing Pezeshkian holding a signed copy of the accord bearing both leaders’ signatures.

The text of the agreement has not been formally released.

US officials, speaking on condition of anonymity, briefed journalists on its contents after days of secrecy, while Iranian state television later published what appeared to be a largely similar version.

Under the accord, the United States will move to waive sanctions that have severely restricted Iran’s oil exports, allowing Tehran to sell crude oil on international markets while broader negotiations continue.

The sanctions relief represents a significant departure from the approach taken in the 2015 nuclear agreement between Iran and world powers, under which major sanctions relief was granted only after Tehran implemented extensive restrictions on its nuclear activities.

Iran earned more than USD 46 billion from oil exports in 2024 despite sanctions, with China remaining its largest customer.

Analysts are likely to view the immediate sanctions waivers as a major concession by Washington because they reduce one of the principal sources of leverage available during negotiations.

The accord also envisages a pathway toward lifting additional US and United Nations sanctions, though officials said the timetable and conditions would be determined during future talks.

Some provisions, including the possible release of frozen Iranian assets and broader economic measures, would be implemented gradually and linked to progress in negotiations, according to officials familiar with the discussions.

The agreement also references plans for up to USD 300 billion in reconstruction and investment assistance for Iran, although Trump said the United States would not contribute directly and that any funding would come from other countries.

Vice President J D Vance has previously suggested Gulf Arab states could play a role in financing reconstruction, though it remains unclear whether regional governments would support such a commitment.

One of the most immediate effects of the accord is the reopening of the Strait of Hormuz, the strategic waterway connecting the Persian Gulf to global shipping routes.

The closure of the strait during the conflict disrupted energy markets, drove up oil prices and contributed to rising costs for consumers worldwide.

According to draft provisions released by both sides, the waterway will reopen without tolls for an initial two-month period, while shipping traffic is expected to return to pre-war levels within 30 days.

The agreement also calls for lifting a U.S.-led blockade of Iranian ports and acknowledges that naval mines deployed during the conflict may need to be cleared before normal maritime traffic resumes.

Before the war, roughly one-fifth of globally traded oil and natural gas passed through the strait.

The agreement requires Iran to dilute part of its stockpile of highly enriched uranium but leaves the ultimate future of its nuclear programme to negotiations scheduled over the next two months.

The United States and Israel launched military operations against Iran in February, arguing that Tehran must be prevented from acquiring a nuclear weapon.

Iran has consistently denied seeking nuclear arms and says its nuclear programme is intended solely for peaceful purposes.

While Trump described the agreement as “very strong”, he also signalled that military action remained an option if talks fail.

“It’s a memorandum of understanding, and if I don’t like it, we’ll go back to shooting at them, dropping bombs,” Trump said.

The interim nature of the accord leaves substantial uncertainty over whether a comprehensive settlement can be reached before the 60-day deadline expires.

The agreement also includes language supporting Lebanon’s territorial integrity amid continuing tensions involving Israel and the Iran-backed Hezbollah movement.

That provision could prove among the most contentious aspects of the accord.

Iran has argued that Israel should withdraw from territory occupied during the conflict, while Israeli leaders have indicated they will continue military operations they consider necessary for national security.

The accord is expected to face scrutiny in Washington and elsewhere, particularly from critics who argue the sanctions relief offered to Tehran exceeds the commitments secured in return.

The deal also contrasts with Trump’s criticism of the 2015 nuclear accord negotiated under former President Barack Obama, which he abandoned during his first term after calling it the “worst deal ever”.

Whether the interim agreement evolves into a lasting settlement will depend largely on the outcome of nuclear negotiations over the next two months, with both sides still divided on the scope of Iran’s enrichment activities, sanctions relief and regional security arrangements.