U.S. and Iran extend ceasefire, reopen Strait of Hormuz for trade

A significant agreement has been signed to extend the ceasefire between the United States and Iran.

According to a White House official speaking to the BBC, this agreement has already been formally implemented. U.S. President Donald Trump, attending the G-7 summit in Évian-les-Bains, France, signed this historic agreement.

With this agreement, the strategically important Strait of Hormuz will reopen for commercial ships.

This marks a major diplomatic success following the intense conflict among the U.S., Iran, and Israel over the past four months.

The 14-point agreement includes Iran’s commitment to never develop nuclear weapons. Additionally, it involves the establishment of a $300 billion fund for Iran’s “reconstruction and economic development”, although the U.S. is not required to contribute financially to this fund.

The Trump administration has termed this agreement “performance-based”, meaning Iran will benefit only if it fulfills its commitments.

Ending conflict on all fronts and Lebanon’s sovereignty

According to the first point of the agreement, the U.S., Iran, and their allied forces have announced an immediate and permanent cessation of military operations on “all fronts”, including Lebanon.

President Trump expressed concern that Israel’s military actions against Hezbollah in Lebanon could jeopardize the agreement with Iran. Iran has also insisted that Lebanon be included in this ceasefire.

The Iranian Foreign Ministry has warned that any military action by Israel in Lebanon would be considered a violation of the agreement, and necessary measures would be taken in response.

Both sides have now expressed their commitment to refrain from military actions against each other and to respect Lebanon’s territorial integrity and sovereignty.

Commitment to non-interference in internal affairs

The second point of the agreement states that the U.S. and Iran will respect each other’s sovereignty and territorial integrity and will not interfere in each other’s internal affairs. According to American officials, this point might disappoint Iranian government opposition protesters and dissident groups.

Earlier this year, during anti-government protests in various Iranian cities, President Trump had assured protesters that “help is coming soon”, but this agreement indicates a shift in the U.S. strategy.

60-day deadline and presidential signatures

According to the third point, both countries must finalize a permanent agreement within a maximum of 60 days. There is also a provision to extend this period by mutual consent. With the leaders of both countries signing the agreement, the 60-day countdown has begun.

President Trump signed the document during a G-7 dinner at the Palace of Versailles in France, while Iranian President Masoud Pejmanian has also signed it. Although a formal signing ceremony was initially planned in Geneva, it is now unclear whether that will take place.

End of American naval blockade

According to the fourth point, with the signing of the agreement, the U.S. will begin lifting the naval blockade and other restrictions imposed on Iranian ports. According to the Iranian Foreign Ministry and the agreement, this blockade will be completely lifted within 30 days.

During this period, the number of ships allowed to travel to and from Iranian ports will be determined based on the proportion of traffic Iran allows through the Strait of Hormuz.

Additionally, within 30 days of the final agreement, the U.S. has committed to withdrawing all its forces near Iran, effectively returning to the situation before the conflict began on February 28.

Safe passage for commercial ships through the Strait of Hormuz

According to the fifth point, Iran will make every effort to allow commercial ships to pass through the Strait of Hormuz safely and without any fees.

When the conflict began, the closure of this waterway caused global crude oil prices to soar, making its reopening a primary goal for the U.S.

Ship traffic will resume immediately, and technical and military obstacles will be removed, including de-mining operations.

In the long term, Iran will work on a broader agreement with Oman and other Gulf countries to manage this waterway.

$300 billion fund for Iran’s reconstruction

The sixth point mentions that the U.S. and its regional partners will develop a plan worth at least $300 billion for Iran’s reconstruction and economic development.

This mechanism will be ready within 60 days, and the U.S. will provide all necessary permits and exemptions for it. However, the U.S. will not spend a cent from its side.

For example, if Iran complies with the agreement, the United Arab Emirates could build a power plant in Iran with American approval.

The Trump administration has assured the American public that this agreement is different from the 2015 nuclear deal under the Obama administration and that the U.S. will not directly give money to Iran.

End of sanctions and nuclear disarmament

According to the seventh and eighth points, the U.S. will lift all United Nations and unilateral economic sanctions imposed on Iran. However, the timeline for this will be determined in the final agreement.

Iran has agreed not to purchase or develop nuclear weapons and will downblend its enriched uranium under the supervision of the International Atomic Energy Agency.

President Trump had stated that preventing Iran from developing nuclear weapons was 99 percent of his objective when launching ‘Operation Epic Fury’.

Economic sanctions will only be lifted if Iran complies with the terms of nuclear disarmament.

Status quo and release of frozen funds

According to the remaining points (9 to 14), the status quo in Iran’s nuclear program will be maintained until a final agreement is reached, and the U.S. will not impose new sanctions.

Meanwhile, the U.S. will issue necessary exemptions for Iran’s oil exports, banking transactions, and transportation. Foreign funds that have been frozen, which Iran has long demanded be released, will be unfrozen once the agreement is implemented.

American officials have stated that some funds will be released immediately based on Iran’s positive steps in areas such as enriched uranium management.

Both countries will establish a mechanism to monitor this agreement, and the final agreement will be approved through a binding United Nations Security Council resolution.