Peace Agreement

U.S. and Iran Agree to End the War

On his 80th birthday, Donald Trump (pictured with Secretary of State Marco Rubio) was finally able to announce the end of the war with Iran.(Bild: AFP/Win McNamee/Getty Images)

The US and Iran have agreed on a memorandum of understanding to end their war. This was announced by Pakistan, the mediating country. “Let the oil flow,” US President Donald Trump confirmed the deal shortly thereafter, along with the accompanying reopening of the Strait of Hormuz. Iran sees itself “as the victor” and announced an immediate end to all attacks. The oil market reacted immediately ...

“After intensive talks, we are pleased to announce that the peace agreement between the United States of America and the Islamic Republic of Iran has been reached,” Pakistani Prime Minister Shehbaz Sharif announced on Sunday evening on the X platform. The agreement is scheduled to be signed in Geneva on Friday.

“Let the oil flow”
Shortly thereafter, confirmation came from the White House—from President Donald Trump himself, also via social media: The Republican “hereby grants full authorization for the duty-free opening of the Strait of Hormuz.” At the same time, he authorized the immediate lifting of the blockade by the U.S. Navy.

The strait would be opened “for the purpose of mine clearance” with the planned signing of the framework agreement with Iran on Friday. “Ships of the world, start your engines. Let the oil flow!” he declared. Following the agreement, Germany, France, the United Kingdom, and Italy declared their readiness to support the resumption of shipping in the Strait of Hormuz.

The Iranian Deputy Foreign Minister also announced an immediate and permanent end to the war and military operations on various fronts, including in Lebanon. He declared Iran the victor in the war that has been ongoing for more than three months. The U.S. and Israel, on the other hand, had not achieved their war aims.

In a statement released on Iranian state television, the Iranian General Staff announced that the Iranian armed forces had imposed their “divine and iron will” on the U.S. and Israel during the war. “The enemy has no choice but to accept defeat and surrender.” 

The Iranian news agencies Mehr and Tasnim have now released details from the 14-point draft of a memorandum of understanding—though it contained unrealistic demands such as reparations payments totaling $300 billion.

The “Wall Street Journal” reported, citing Trump, that the agreement stipulates that Iran would not seek nuclear weapons and would immediately open the Strait of Hormuz. In return, sanctions against the Islamic Republic could be lifted. However, cash payments are not planned. In addition, there would be strict controls. The removal of nuclear material from Iran was not a priority for him at this time and could take place later. Trump told the “New York Times” that Iran would face new military attacks if a final nuclear agreement were not reached.

Oil markets reacted immediately
Oil prices reacted immediately following the statement and confirmations: Brent crude fell by $3.51 per barrel, or 4.02 percent, to $83.82, while U.S. West Texas Intermediate crude oil cost $80.95, a drop of $3.93, or 4.63 percent.

During a series of meetings in the coming days, representatives from both sides are expected to lay “the groundwork for technical talks.” No further details regarding the exact contents of the agreement were initially disclosed. However, the framework agreement is only an intermediate step, albeit an important one—further key agreements regarding the conflict between the two countries, such as the nuclear dispute, are to be negotiated in detail during subsequent talks.