Iran, US agree to halt war and reopen Hormuz, sending oil prices tumbling
Iran's Foreign Minister Abbas Araghchi also said there must be a complete halt to Israeli attacks against Lebanon.
Traffic moves past the Iranian national flag displayed on a building at Enghelab square in Tehran, Iran, on Jun 14, 2026. (File photo: AFP)
DUBAI: United States and Iranian officials said on Sunday (Jun 14) they had reached an agreement to end their war and reopen the Strait of Hormuz, a preliminary pact that sent oil prices falling but left the fate of Tehran's nuclear programme to further negotiations.
While still a framework, the deal marked the biggest breakthrough towards resolving the conflict that has killed thousands and upended energy markets since it began with joint US-Israeli strikes on Iran in February.
"The Deal with the Islamic Republic of Iran is now complete," Trump wrote on his Truth Social platform around 5.30pm local time in Washington on Sunday.
His post came shortly after Pakistani Prime Minister Shehbaz Sharif, whose country has served as a mediator, announced a deal had been struck early on Monday local time.
The memorandum of understanding is scheduled to be officially signed on Friday in Switzerland.
The precise terms of the deal were not immediately known. Sharif said in a post on X that the pact called for "the immediate and permanent termination of military operations on all fronts, including in Lebanon".
LEBANON HAS BEEN A STICKING POINT
Lebanon has suffered the deadliest spillover of the conflict, with thousands of people killed and some 1.2 million people uprooted by an Israeli offensive against the Iran-backed Hezbollah group, which opened fire on Israel in support of Tehran on Mar 2.
The country has been a sticking point in negotiations, with Israel and Hezbollah ignoring calls from Trump and others to stop their attacks on each other in recent weeks.
The secretariat of Iran's Supreme National Security Council said war and military operations on all fronts, including Lebanon, would end permanently starting on Monday night.
Iran's Foreign Minister Abbas Araghchi said there must be a complete halt to Israeli attacks against Lebanon and wrote on Telegram that the US bears responsibility for implementing the framework deal.
Nabih Berri, speaker of the Lebanese parliament and a Hezbollah ally, said the deal laid the foundation for security and stability in the region, including in Lebanon.
Israeli Prime Minister Benjamin Netanyahu has yet to respond publicly to the US-Iran agreement.
But Defence Minister Israel Katz said that Israel would oppose any pressure to withdraw its forces from areas it is occupying in southern Lebanon.
"This is the main lesson from the events of Oct 7," Katz said.
"Prime Minister Netanyahu made this clear to US President Trump and other senior American officials, and I also clarified it yesterday to US Defense Secretary Pete Hegseth."
STRAIT TO REOPEN
Iran's deputy foreign minister, Kazem Gharibabadi, said a more expansive agreement on the wider conflict would be negotiated during a 60-day ceasefire period, including sanctions relief for Iran.
The fate of Iran's nuclear programme, another thorny issue, will also be addressed in those later talks, sources previously told Reuters.
Trump said the Strait of Hormuz, a major shipping route for global oil and gas supplies that Iran has effectively shut down for months, would open on Friday, and that he had ordered the end of the US blockade of Iranian ports.
"Ships of the World, start your engines. Let the oil flow!" Trump wrote.
Oil prices fell on the news. Brent crude futures fell 4 per cent in early trading on Monday, while stock markets jumped.
The war has become a political liability at home for Trump and his fellow Republicans in Congress, with public opinion polls showing Americans deeply frustrated by rising gas prices ahead of November's midterm elections.
But Trump has also faced pressure from members of his own party who insist that Iran's nuclear programme must be completely shut down.
Republican Senator Lindsey Graham, a leading Iran hawk, praised the deal but said he would be "watching closely" the coming negotiations on Iran's nuclear programme.
"Under our law, any nuclear deal with Iran will be sent to Congress for review and a vote," he said. "Congratulations to all in getting us to this point."
During his first term, Trump withdrew the US from a 2015 multilateral Iran deal, negotiated by Democratic President Barack Obama, that lifted sanctions on Tehran in exchange for limits on its nuclear programme, including international inspections.
Iran responded by ramping up its enrichment of uranium, producing more than 400kg of material at close to bomb-grade purity.
RELEASE OF FROZEN ASSETS
The agreement was sealed despite an Israeli strike on Lebanon on Sunday that drew criticism from both Iran and Trump.
Netanyahu has disregarded American demands that Israel curb its military action in Lebanon to allow the US to reach a deal with Iran, saying it will retain freedom of operations there.
Meanwhile, Iran made a full ceasefire in Lebanon an important component of its demands.
Leaders outside the Middle East, who have kept a wary eye on the conflict, welcomed the announcement of a deal.
In a joint statement, Britain, Germany, France and Italy said they were prepared to lift sanctions on Iran in response to "clear, verifiable steps" to limit its nuclear programme.
China also welcomed the deal.
Before the deal was announced, a senior Iranian official told Reuters that, under the terms of the draft, the US would agree to release US$25 billion of frozen Iranian assets.
The Trump administration has previously said any release of Iranian money would only take place once Iran has fulfilled certain conditions under a peace deal.
A US official, also speaking before the announcement, said the agreement would ultimately lead to the dismantling of Iran's nuclear programme, with its stockpile of highly enriched uranium to be destroyed and removed.
A senior Iranian official said the draft deal would allow Iran, which denies seeking a nuclear bomb, to dilute its enriched uranium inside the country.
