Markets are celebrating the first US-Iran deal aimed at ending their war that caused a global recession and lasted nearly four months. Stocks rose on Monday, as oil prices and bond yields fell.
No agreement has been signed, although the parties have agreed on a “memorandum of understanding” and de-military, and the critical Strait of Hormuz will be reopened as part of the agreement, according to US President Donald Trump.
Here’s what we know about the deal and what might happen next.
Did Iran sign a peace deal?
The Deputy Minister of Foreign Affairs of Iran, Kazem Gharibabadi, said that the document has been finalized and will be signed on Friday in Geneva. He added, “The end of the war forever and immediately declared on all sides.” Trump also said the US naval blockade of Iran would be lifted.
The text of the memorandum of understanding has not been released, as of Monday. What we do know are the statements of those involved in the negotiations.
Is the Strait of Hormuz open?
The Strait of Hormuz is not officially open yet, but both Trump and Iran’s Deputy Foreign Minister said it would reopen on Friday after signing in Geneva.
Trump’s response to the Social Truth deal focused almost entirely on the strait, saying it would be reopened without tariffs.
He wrote on Truth Social: “I hereby fully authorize the free opening of the Strait of Hormuz, and, at the same time, I authorize the immediate lifting of the United States Navy blockade. Ships of the World, start your engines. Let the oil flow!”
He later wrote that the strait would open “when the Deal is signed on Friday, for the purpose of removing the mine.”
Iranian news agency Mehr later reported that the reopening of the strait would be under “Iranian plans.”
Qatar said on Monday that it welcomes the agreement between the US and Iran “to resolve the issues that exist between them, including ensuring that there is freedom of navigation in the Strait of Hormuz.”
Is the war over?
The US and Iran have set up an imminent war. The deal will extend the ceasefire for 60 days to create a framework for future talks on Iran’s nuclear program, sanctions and regional security.
These negotiations could form a final peace agreement. Gharibabadi said the 60-day nuclear talks can only begin if the US releases billions of dollars in frozen Iranian currencies. The US has rejected the claim.
Trump also said on Sunday that “Iran will never have a nuclear weapon.” He also told the New York Times that the US could attack Iran again if talks fail to produce a solution to its nuclear ambitions.
“The threat of a renewed conflict will continue in the coming months. Adding more difficult issues to the latest negotiations increases uncertainty and leaves the conflict unresolved,” Torbjorn Soltvedt, principal analyst at intelligence firm Verisk Maplecroft, told CNBC.
Most importantly, Israel is not a party to the agreement. The country has been at war since the first strike on February 28. Its attacks on targets in Lebanon have shaken the ceasefire at times. Earlier, Gharibabadi said the “permanent and immediate end to the war” he declared included Lebanon. It is not clear whether Israel accepts that.
On Monday, Israel’s Defense Minister Israel Katz said in a statement that the Israeli Defense Forces will remain in the so-called security areas in Lebanon as well as in Gaza and Syria, adding that Israel will retaliate if Iran attacks the country because of the events in Lebanon.
Who can attend the Geneva signing?
Tehran has not yet released a list of attendees, which could reveal what is behind the deal in parts of Iran’s political establishment.
Abbas Araghchi, the country’s foreign minister, was involved in the talks led by Pakistan and is likely to be Iran’s most senior signatory.
If the speaker of the parliament Mohammad Bagher Ghalibaf attends, it may indicate a buy-in for Iran’s conservative and security institutions. If top security official Mohammad Bagher Zolghadr attends, that would mean Iran’s supreme leader approves. Zolghadr, however, is under sanctions.
There are no official US embassies confirmed.
Vice President JD Vance was reportedly considering a signing ceremony if the deal was done. Trump can also go there directly from the G7 summit in Évian-les-Bains, France. White House envoy Steve Witkoff, who has led much of the US-Iran negotiations track, is likely to participate.
The conflict involves many groups and countries beyond just the US and Iran.
One of the most important signs will be that Saudi Arabia and the United Arab Emirates, both involved in the war, are sending representatives of their Cabinets. That would suggest that the agreement has broad support from countries in the region.
Israeli officials are not expected to attend.
Correction: This article has been updated to correct the name of the Israel Defense Forces.
