After being at a war for over four months, the US and Iran will finally be signing an interim memorandum of understanding on Friday. The signing, which will take place in Switzerland, will pave the way for 60 days of negotiations aimed at ending the conflict and imposing strict limits on Tehran’s nuclear programme.According to a draft of the agreement, Iran would be allowed to immediately resume oil exports and gain access to an economic development programme worth at least $300 billion as part of broader efforts to reach a permanent peace deal addressing its nuclear activities.The draft document, which has not yet been officially released by either side, is already being circulated by the US among allied nations attending the G7 summit in France. Another person familiar with the discussions told Reuters that technical details are still being finalised, indicating that some language could change before the signing ceremony.
Inside the agreement:
Oil and uranium concernsThe agreement outlines significant economic relief for Iran in exchange for ending its restrictions on the Strait of Hormuz and reaffirming that it will never seek a nuclear weapon. Once the memorandum is signed, the US treasury department would issue waivers allowing exports of Iranian crude oil and petrochemical products, Bloomberg reported.The US would also end its naval blockade of Iranian ports, while both countries would work to restore maritime traffic through the Strait of Hormuz to pre-war levels within 30 days.Oil markets reacted sharply to expectations surrounding the deal. Brent crude dropped below $78 a barrel, reaching its lowest level in more than three months. Prices have fallen 15% over the past four trading sessions, marking the longest losing streak of the year amid expectations that the reopening of the Strait of Hormuz could increase global supplies.At the same time, the draft agreement does not directly address Iran’s existing stockpile of enriched uranium. Instead, it states that the future of Iran’s enriched uranium “will be adequately addressed in a final agreement” alongside other unresolved nuclear issues.Financing framework and frozen fundsUnder the draft agreement, the US and its regional partners would establish a framework to support Iran’s rehabilitation and economic development with financing of at least $300 billion. The document also states that the US undertakes that Iran’s frozen funds “will be released and made fully available”, although no timetable has been specified.A US official declined to discuss the details of the draft but said Iran would only receive the benefits of the agreement if it fulfilled its obligations. These include never obtaining a nuclear weapon, neutralising its enriched nuclear material and ensuring freedom of navigation through the strait.Iran, meanwhile, is seeking guarantees over access to its frozen assets. The semi-official Tasnim news agency quoted Central Bank Governor Abdolnaser Hemmati as saying Tehran would demand “full assurance regarding effective access” to those funds after the interim agreement is formally signed.According to Hemmati, American commitments to release Iranian assets are “explicitly and actionably stated” in the agreement.
Dispute over $300 billion figuresUS President Donald Trump had previously denied that Washington would pay Iran $300 billion. The draft agreement instead states that the US and its partners would ensure financing of that amount.One of the major challenges in the negotiations remains the conflict involving Israel and the Iran-backed militant group Hezbollah. The draft states that the war will be ended “on all fronts, including in Lebanon”, a provision that would require the approval of Israeli Prime Minister Benjamin Netanyahu, who has so far refused to end Israel’s campaign against Hezbollah along the country’s northern border.“It’s crucial that Israel stays in southern Lebanon for the time being, cleaning after the Hezbollah infrastructure,” Mark Regev, former Israeli Ambassador to the UK, told Bloomberg.Iran’s parliament speaker and chief negotiator Mohammad Bagher Ghalibaf said Israel “must withdraw from occupied territories” in Lebanon, according to the semi-official Mehr news agency.The draft also provides for the eventual lifting of US sanctions on Iran, although this would only occur as part of a final agreement negotiated during the next two months. In addition, the US would withdraw military forces “from the surrounding areas” within 30 days of a final settlement.Uncertainty over timelineThere remains uncertainty over when the text of the agreement will be made public. Trump has said it would be released sometime after Friday’s signing ceremony, while a senior US official said earlier this week that publication could come within days.The ceremony is expected to take place at the Bürgenstock mountain resort overlooking Lake Lucerne, according to the Swiss foreign ministry. US Vice President JD Vance is expected to lead the American delegation, while Iran is likely to be represented by Ghalibaf.Meanwhile, speaking at the G7 summit, Trump described the agreement as a “done deal” that would prevent Iran from developing nuclear weapons. He also said the US would not pay war reparations or invest money in Iran, adding that Tehran’s leaders “have to prove themselves, I think, before any of us go in there.”