US, Israel, and Iran Reach Two-Week Ceasefire Agreement to Reopen Strait of Hormuz

The United States, Israel, and Iran agreed to a two-week ceasefire on Tuesday evening, April 7, 2026, less than two hours before a deadline set by US President Donald Trump for Tehran to reopen the Strait of Hormuz or face further military action. The agreement, mediated by Pakistan, came after Pakistani Prime Minister Shehbaz Sharif and the country's military chief, Field Marshal Asim Munir, urged Washington to extend its deadline and pressed Tehran to reopen the strait. Iran's Minister of Foreign Affairs Abbas Araghchi confirmed that Tehran would cease counter-attacks and ensure safe passage through the waterway for the duration of the ceasefire, coordinating with the country's armed forces. Trump announced the deal on his Truth Social platform, writing: "This will be a double sided CEASEFIRE!" The war, now in its sixth week, has claimed more than , including more than 1,600 civilians in Iran, according to tallies from government sources and human rights groups.

Pakistan's mediation hailed as "gift" by traders Pakistan's role in brokering the agreement drew widespread recognition, with stock market traders and analysts describing the outcome as a "gift from Pakistan." Sharif announced on X that he had invited Iranian and US delegations to meet in Islamabad on Friday, April 10, 2026, for formal talks. Iran presented a 10-point plan that Trump described as a "workable basis for negotiations," though analysts noted that significant sticking points remain. A source briefed on the talks expressed wariness about the ceasefire holding, describing it as a "trust-building exercise" and warning that the US side believed Iran might be using the pause to buy time. Iran's Supreme National Security Council portrayed the deal as a victory for Tehran, claiming Trump had accepted Iran's conditions. Trump, in turn, told the French news agency AFP that the outcome represented a "total and complete victory" for the United States. The ceasefire's scope remained contested: Israeli Prime Minister Benjamin Netanyahu's office stated the pause does not apply to Lebanon, in apparent contradiction to earlier comments from Sharif, who said the agreement included a cessation of Israel's campaign there. Lebanon's state news agency reported continued Israeli strikes across southern Lebanon, including an air strike near a hospital that killed four people.

„Total and complete victory. 100 percent. No question about it.” — Donald Trump via Irish Independent

The US-Israel military campaign against Iran, designated Operation Epic Fury, began on February 28, 2026, and resulted in the death of Supreme Leader Ali Khamenei in the initial strikes. His son, Mojtaba Khamenei, was appointed Supreme Leader on March 9, 2026. Iran responded by closing the Strait of Hormuz to commercial shipping, disrupting global energy markets and triggering an international diplomatic effort to reopen the waterway. British Foreign Secretary Yvette Cooper chaired a meeting of more than 40 countries in London the week before the ceasefire to discuss economic and diplomatic measures to press Iran into reopening the strait.

Oil prices collapse, European stocks surge on the news Global financial markets reacted sharply to the ceasefire announcement, with oil prices and equity indices moving in opposite directions. Prices for Brent crude fell at times below 92 dollars per barrel, reaching their lowest level since mid-March, while the Brent and WTI grades dropped by 13 to 15 percent overnight, according to Swiss market analysts. European stock markets opened sharply higher, with the German DAX rising 4.9 percent to 24,047 points, the Euro-Stoxx-50 climbing 4.4 percent to 5,879 points, the London FTSE-100 gaining 2.5 percent to 10,608 units, and the Vienna ATX advancing 3.6 percent to 5,637 points. Asian indices had already jumped by more than 5 percent in some cases earlier on Wednesday. Chief Economist Thomas Gitzel of VP Bank wrote that the ceasefire offered hope that the rise in inflation rates would remain "a short episode," and that central banks could refrain from feared interest rate hikes if oil prices ease sustainably. Analysts cautioned, however, that oil prices are not expected to fall back to pre-war levels immediately, as damage to production facilities would need to be assessed in the coming weeks.

DAX (Frankfurt): 4.9, Euro-Stoxx-50: 4.4, ATX (Vienna): 3.6, FTSE-100 (London): 2.5

Starmer flies to Gulf, Merz calls for permanent peace deal British Prime Minister Keir Starmer traveled to the Gulf on Wednesday to meet regional leaders and discuss diplomatic efforts to support and sustain the ceasefire. Starmer's visit had been planned before the ceasefire was announced, but took on added significance given mounting domestic pressure over UK access to British airbases used in the US-led campaign. Starmer welcomed the agreement, stating that the international community must work to turn the two-week pause into a lasting resolution and ensure the permanent reopening of the Strait of Hormuz.

„I welcome the ceasefire agreement reached overnight, which will bring a moment of relief to the region and the world.” — Keir Starmer via The Guardian

German Chancellor Friedrich Merz also welcomed the deal, stating that the goal must now be to negotiate a permanent end to the war through diplomatic means, and that Germany would contribute to ensuring free shipping in the Strait of Hormuz. Merz said the German government was in close exchange with the United States and other partners to support further negotiations, and thanked Pakistan for its mediation role.

„The goal must now be to negotiate a permanent end to the war in the coming days. This can only be achieved through diplomatic means.” — Friedrich Merz via Wirtschafts Woche