US and Iran Near Electronic Agreement to Extend Ceasefire for 60 Days

The United States and Iran are approaching the electronic signing of a memorandum of understanding that would extend the ceasefire between the two countries for 60 days. This step aims to pave the way for a "second phase" of "technical talks" addressing outstanding files, marking a notable move toward ending the war.

On Saturday, U.S. President Donald Trump announced that a preliminary agreement to end the Middle East war was scheduled to be signed on Sunday. However, the Iranian Foreign Ministry expressed skepticism about the likelihood of completing the signing at the announced time, urging caution regarding circulating reports about the deadline and noting that consultations are ongoing.

Uncertainty remains regarding the specific terms of the memorandum under development. Nonetheless, U.S. and Iranian officials have revealed key features of the anticipated agreement, which covers several issues including Iran’s nuclear program, the Strait of Hormuz, and frozen Iranian assets.

Despite positive indicators, a clear gap persists between the U.S. and Iranian narratives concerning the agreement’s content.

According to copies of a draft memorandum reviewed by Reuters from Western, Iranian, and Pakistani sources, the proposed text includes lifting sanctions on Iranian oil exports and releasing billions of dollars in frozen Iranian assets. In exchange, the Strait of Hormuz would be reopened and hostilities halted on various fronts, including Lebanon.

The Nuclear Program Moves to a Second Phase

Iranian Foreign Minister Abbas Araghchi stated on Friday that provisions related to managing Iran’s nuclear program will be finalized within 60 days of signing the initial agreement, with the possibility of extending this period.

He affirmed that Iran has not agreed to dismantle its nuclear program and intends to keep uranium in a diluted form.

Conversely, a U.S. official indicated that the final agreement would lead to dismantling Iran’s nuclear program, including destroying and transferring the stockpile of highly enriched uranium, without specifying which party would handle this process.

President Trump described the agreement his administration is negotiating as a "wall" preventing Iran from acquiring nuclear weapons, asserting that Tehran "no longer wants a nuclear weapon, and will not obtain one by purchase, development, or any other means."

The U.S. president added that the United States will, "at the appropriate time and after stabilization," recover remaining nuclear materials buried under Iranian facilities that have been bombed, emphasizing that these materials will be diluted and destroyed either inside Iran or in the United States.

The United States and Israel fear that Iran’s nuclear program could lead to nuclear weapon development, a key justification for the war, while Tehran maintains its program is for peaceful purposes, according to the Associated Press.

Strait of Hormuz: Fees or Services?

On Saturday, President Trump announced that the Strait of Hormuz would be "immediately open to everyone" once the agreement with Iran is signed.

Earlier, a U.S. official stated, "Iran will open the Strait of Hormuz, which is a fundamental condition, and it may be open without fees. At the same time, we will lift the blockade." The official added, "This will happen simultaneously, and the next step will be mine clearance in the strait, with G7 countries potentially playing a role."

Iranian Foreign Minister Abbas Araghchi said on Friday that the management of the Strait of Hormuz "will be different from what it was in the past," clarifying that services provided there "will no longer be free," as reported by Iranian media.

He noted that the Strait of Hormuz is "under the joint sovereignty of Iran and the Sultanate of Oman," explaining that both countries have worked for many years to "ensure navigation security, define transit routes, protect the environment, and provide search and rescue services."

Araghchi emphasized that the presence of Iranian armed forces in the Strait of Hormuz "will remain permanent" as a "guarantee of regional security," and that Iran’s military capabilities will continue to be present to protect the strait.

He stated, "What matters to us is that the entity responsible for managing the Strait of Hormuz is clearly defined, and that the principle that services provided there will no longer be free is established."

The official Iranian news agency IRNA reported that the agreement does not include Tehran’s commitment to "transfer the management of the Strait of Hormuz."

Frozen Assets

Multiple sources indicate that the draft provisions include the United States beginning to release billions of dollars in frozen Iranian assets and easing sanctions on oil exports in exchange for reopening the Strait of Hormuz, according to Reuters.

Iranian Foreign Ministry spokesperson Esmail Baqaei was quoted by the Iranian Fars News Agency as saying that releasing frozen assets is a fundamental part of the agreement.

President Trump, however, asserted that the agreement does not involve transferring American funds to Iran, emphasizing that "no money will move" to Tehran under the agreement, signaling his refusal to provide new funding despite reports about the possible release of frozen Iranian assets.

On Friday, a senior U.S. official told journalists in a phone call that it is not possible to specify Iran’s gains in advance because everything depends on implementation, including Iran’s reintegration into the global economy. The official confirmed that releasing frozen Iranian assets, easing sanctions, and other measures remain contingent on Tehran’s level of commitment.

Uncertainty Regarding Lebanon

Reuters reported that a draft agreement calls for halting hostilities on various fronts, including Lebanon. However, Israeli Defense Minister Yisrael Katz warned that Israel might continue independent operations against Iran.

Israeli Prime Minister Benjamin Netanyahu stated that Tel Aviv will not be a party to the agreement, amid tensions with Washington over restrictions on military operations in Lebanon.

When asked about Lebanon on Friday, a U.S. official responded that "achieving peace requires commitment from all parties," adding that "Hezbollah and Iran bear part of the responsibility if rocket attacks continue or their support persists."

The official also referred to what he called "Israeli concerns," but said the United States does not expect Israel or regional countries to give up their right to self-defense. He added that the U.S. believes involving all parties in the peace process will encourage others to follow suit.

First Step in the Process

Thomas Warrick, chief advisor at the Atlantic Council in Washington, anticipated that restrictions on the Strait of Hormuz would be lifted upon signing the agreement, with negotiations on the nuclear file, sanctions, and frozen assets commencing simultaneously.

In an interview with Al-Sharq, Warrick described lifting the blockade on Iran as the "first step" that will quickly reveal whether Tehran intends to target ships entering or exiting the strait.

Warrick, a former U.S. State Department official in the Middle East and International Justice Affairs office, noted that Tehran sees the possibility of imposing "fees" on strait transit but warned that Washington would consider such fees a breach of the agreement if implemented.

Regarding nuclear negotiations, Warrick said it will take weeks before it becomes clear whether the parties are close to a final deal, highlighting that the fate of pre-enriched uranium will be the most critical test.

He doubted that Iran would completely relinquish its enriched uranium but suggested Iran might agree to reduce its enrichment level, lowering the potential for its use in nuclear weapons.

Warrick added that this would require heavy equipment to extract uranium from underground facilities and predicted that Iran would not permit American engineering or construction teams to supervise or even monitor this process.

Divergence in Priorities

Former Iranian Foreign Ministry official Hadi Afkahi said the negotiations are moving toward formulating a "memorandum of understanding" rather than a final agreement, involving two main tracks amid clear differences in priorities between the two sides.

Afkahi told Al-Sharq that the first track in the memorandum covers files related to the regional situation, particularly Tehran’s proposals concerning the Strait of Hormuz, lifting maritime restrictions, and releasing frozen Iranian assets, alongside American commitments to implement agreed obligations.

The second track pertains to a more complex later phase, including the Iranian nuclear file, especially the fate of enriched uranium and the mechanism for dealing with the International Atomic Energy Agency, expected to be the focus of subsequent negotiations if the first phase succeeds.

Afkahi stated that progress on the first track remains conditional on stopping the war, emphasizing that failure to meet this condition would freeze progress on outstanding issues.

He pointed out that one of the main points of contention involves decision-making mechanisms within the Iranian side, noting internal differences that affect the pace of negotiations and finalizing the memorandum’s provisions.

Afkahi also highlighted that some issues, notably the status of the Strait of Hormuz, remain disputed.

He affirmed that enforcement guarantees remain a central focus, with each side demanding clear commitments from the other before moving to the next negotiation phase.