Trump and Pezeshkian sign preliminary Iran deal, opening Strait of Hormuz for 60-day truce

A deal signed at a distance

Trump signed from the Palace of Versailles, flanked by European leaders including Emmanuel Macron. Pezeshkian signed from Tehran, and Pakistan finalised the document as mediator in Islamabad. A planned joint ceremony in Switzerland for Friday was cancelled after Iranian officials said nothing was confirmed.

“Great work.”

The so-called Islamabad Memorandum of Understanding was transmitted electronically and inked without the traditional handshake or flag-lined hall that usually marks the end of a conflict.

Ceasefire and Strait reopening

The 14-point memorandum orders an immediate and permanent halt to military operations on all fronts, including Lebanon. Iran ordered the removal of tolls on commercial vessels transiting the Strait of Hormuz for 60 days, with the state broadcaster IRIB confirming that the government will cover any unpaid fees during this period.

Vice President JD Vance announced that CENTCOM had allowed more than a dozen ships to cross the US naval blockade. The French LNG carrier Mraikh, loaded with 76,535 tonnes of gas for QatarEnergy, was the first to pass, followed by the Italian vessel Grande Torino after more than 100 days at anchor in the Persian Gulf. Italian foreign minister Antonio Tajani posted video of the passage, calling it one of the first to cross.

The $300 billion question

The text outlines a plan for a reconstruction and development fund of at least $300 billion for Iran, to be drawn from Middle Eastern partners, not from the United States. Washington’s role is limited to relaxing sanctions to facilitate transfers. The agreement also releases $24 billion in frozen Iranian assets. Trump dismissed reports of a US payout as "Democratic propaganda."

“There is no $300 billion payment to Iran from the United States. That is fake news!”

Vance stressed that Iran would see economic benefits only if it fully complies and changes its behaviour. The United States, he said, would not contribute a cent.

Hawks erupt, Iran warns

Republican hardliners and Israeli officials reacted with fury, unearthing Trump’s own past tweets in which he called the 2015 Obama-era deal a "rotten deal" that gave Iran billions. Critics labelled the memorandum appeasement, and veteran correspondent Guillermo Fesser described it as "a full-blown surrender, no matter how he sells it."

From Tehran, parliament speaker Mohamad Baqer Qalibaf warned that if the other side breaks its word, commits treason, or oversteps, the Islamic Republic will deliver a "firm response to the enemy." He added that the United States, having already received a slap during the war, would get a harder one if it followed the same path. Supreme leader Mojtaba Jamenei said he had approved the deal despite holding a "different opinion."

The path forward

Sixty days are set aside to negotiate a final, comprehensive accord that addresses Iran’s nuclear programme. Vance said he hopes to travel to Switzerland this weekend to launch technical talks. The agreement does not bind Israel or Hezbollah, and Israeli strikes on southern Lebanon continued on Thursday, a factor that Washington acknowledges could derail progress. The memorandum also says Iran will never obtain nuclear weapons, but the exact terms of uranium dilution are yet to be settled.