PARIS/WASHINGTON — U.S. President Donald Trump said on Monday that the United States and Iran had signed a preliminary agreement aimed at extending a fragile ceasefire and easing tensions in the Gulf.
However, both sides indicated that a permanent truce has not yet been negotiated.
The agreement would extend a ceasefire first announced in April by another 60 days.
It would also reopen the Strait of Hormuz, which Iran has effectively blocked since the United States and Israel attacked Iran in February.
Negotiators are expected to use the next phase of talks to address more difficult issues, including the future of Iran’s nuclear programme.
“The deal’s all signed,” Trump said after arriving in France for a summit of the Group of Seven major economies.
He said Vice President JD Vance would attend a formal signing ceremony in Geneva on Friday.
Oil Prices Fall After Deal Announcement
Oil prices fell to their lowest level since March 10 after the announcement.
The market reaction followed expectations that the Strait of Hormuz could reopen to shipping.
The narrow waterway between Iran and Oman is a critical route for global energy supplies.
Its blockade had disrupted about one-fifth of the world’s oil trade and unsettled global energy markets.
The preliminary agreement marks the most significant diplomatic step so far in efforts to halt the conflict.
The war has killed at least 7,000 people, most of them in Iran and Lebanon.
However, many details of the document remain unclear.
It is also not yet clear whether the new agreement differs substantially from the April ceasefire arrangement.
Iran Says Final Truce Still Pending
Iranian President Masoud Pezeshkian described the U.S.-Iran memorandum of understanding as an “important step” toward ending the fighting.
But he said a final agreement for a lasting truce “has yet to take shape”.
Vance told CNN that the signed memorandum was about one-and-a-half pages long.
He described it as “a very general document”.
U.S. officials said details would be released over the next two days.
Vance said the memorandum included “a very significant sanctions relief package” for Iran.
U.S. and Iranian officials said the deal could eventually bring major economic benefits to Iran.
These could include sanctions relief, the unfreezing of foreign assets and a $300 billion reconstruction fund.
Officials said the fund would be paid for by neighbouring Gulf states, which host U.S. military bases.
Nuclear Programme Still Unresolved
U.S. officials, speaking on condition of anonymity, said Iran would need to meet American demands before receiving the full benefits.
They said Washington wants Iran never to build a nuclear weapon.
They also said Iran must cut off support for regional militias, including Hezbollah in Lebanon.
Iran has consistently denied that it intends to build a nuclear weapon.
Tehran previously agreed to sharply restrict its nuclear programme under a 2015 deal with the United States and other world powers.
Trump withdrew the United States from that agreement during his first term.
The new memorandum does not resolve the fate of Iran’s stockpile of enriched uranium.
Trump has said he wants the stockpile destroyed or removed.
Iranian officials say they have given up little by agreeing to resume diplomatic discussions.
They say talks over the nuclear programme were interrupted in February when Trump launched military action alongside Israel.
Strait of Hormuz Reopening Still Needs Security Assurances
The agreement would lift Iran’s chokehold on the Strait of Hormuz.
But shippers say traffic will only resume once safety is guaranteed.
Iran has suggested it will retain control of the strait with Oman.
The United States says the waterway will be open toll-free for 60 days.
Washington also expects that provision to be included in any final agreement.
Lebanon Remains a Sticking Point
The fighting between Israel and Hezbollah in Lebanon remains one of the most sensitive issues.
The conflict has uprooted 1.2 million people.
Iran says the deal requires a full cessation of hostilities in Lebanon.
However, Israeli Prime Minister Benjamin Netanyahu said Israel would keep its forces in southern Lebanon.
He also said Israel would retain the right to respond to Hezbollah attacks.
“Iran wanted us to withdraw from it, but I stood firm,” Netanyahu said at a news conference.
He acknowledged that he and Trump had differed over aspects of the conflict.
Israel has not directly participated in the peace talks with Iran.
A U.S. official said Israeli withdrawal from Lebanon was not a condition of the deal.
Disagreement over Lebanon was also a point of contention in the April ceasefire agreement.
Fighting Reported After Announcement
Security sources said fighting in Lebanon had reduced after the agreement was announced.
However, they said it had not stopped completely.
Lebanese state media reported that an Israeli drone struck a car in the southern Lebanese town of Kfar Tebnit, killing the driver.
Netanyahu said Israeli forces had killed four “militants”.
Iranian Foreign Minister Abbas Araqchi said Israeli attacks must stop immediately.
Privately, Israeli officials have expressed concern about the deal.
One senior official, speaking on condition of anonymity, described the agreement as “terrible for Israel”.
The official said that view was shared across the Israeli government, from Netanyahu down.
The next stage of talks in Geneva is expected to determine whether the preliminary memorandum can become a lasting truce.