U.S., Iran sign preliminary deal to end war, with free passage through Strait of Hormuz expected in final pact

The United States and Iran have already signed a memorandum of understanding (MOU) aimed at ending their monthslong war, with a formal signing ceremony scheduled for later this week, senior U.S. officials said Monday.

During a press call, officials said U.S. President Donald Trump, Vice President JD Vance and Iran's parliamentary speaker Mohammad Bagher Ghalibaf inked the MOU that would extend the countries' cease-fire for 60 days, during which negotiations will take place to address nuclear and other issues to reach a final peace deal.

The electronic signing came ahead of a formal ceremony set to take place in Switzerland on Friday.

The officials confirmed that the MOU states that the Strait of Hormuz will be open toll-free for 60 days, noting that Washington expects toll-free traffic in the channel — a key shipping route for oil, natural gas and other commodities — to be part of the final agreement.

Other details of the MOU were not immediately available, but the officials said they will be released within the next day or two. The MOU is a page-and-a-half "general document" that sets out a framework under which Iran receives the benefits of the deal only by meeting its obligations, Vance told CNN.

"They will be put out in the next 24 to 48 hours, and this is really just the first MOU," one official said during the press call.

"And then we're going to launch into the real technical discussions later this week [...] the vice president will continue to lead these negotiations," he added.

Another official expected a "significant increase" in ship movements through the Strait of Hormuz, the waterway that Iran all but closed during the war that began with the U.S.-Israeli attack on the Islamic Republic in late February.

"You will see a significant increase in traffic in the Strait of Hormuz, actually starting already, and that will ramp up slowly over time," the official said, noting that there may not be a "return to normal" in the next two weeks.

Observers anticipated that the return of traffic to prewar levels would take time, given the need to clear mines and secure safe passage along the waterway, not to mention safety concerns among risk-averse seafarers.

The MOU makes it "explicit" that traffic in the strait will be toll-free for two months, the officials said amid questions over whether it can continue to remain so beyond the set period.

"We're quite explicit in this MOU. The strait will be open toll-free for 60 days, and we expect that to become part of the final agreement as well," the second official said.

During a summit with French President Emmanuel Macron on the margins of the Group of 7 summit in Evian-les-Bains, France, Trump reaffirmed that the strait will be toll-free under the MOU.

"We have an agreement where it's going to be open and it's toll-free. We had a little argument on that [...] It's toll-free," he said.

But Iranian state media reported that Iran and Oman will manage the strait after the 60-day period is over.

Restoring free passage through the strait was a key part of the U.S.-Iran negotiations, as disruptions to maritime traffic in the waterway have pushed up energy prices, deepened inflation concerns and weighed heavily on the global economy.

Korea and other countries have hoped for an early peace settlement between the United States and Iran as their vessels have been trapped in the Strait of Hormuz due to the war. Two dozen Korea-linked vessels remain stranded in the strait.

Asked about the absence of Iran's Supreme Leader Mojtaba Khamenei in the signing of the deal, the second official said that the Iranian parliamentary speaker is "the person with currently the most influence" in Iran's national system who is "given sanction" by the supreme leader and Tehran's National Security Council.

"President [Trump] wanted to sign it personally because he wanted to show his dedication to the process and dedication to seeing this through to a successful resolution," he said.

The officials reiterated that any U.S. benefits under the peace deal would be contingent on Iran's "performance."

"We discussed the possibility of releasing frozen funds, sanctions relief [...] a big $300 billion fund to rebuild their country," the first official said. "All of these things are going to be tied to performance."

The official underscored that the United States is "prepared" to release Iranian funds frozen by U.S. sanctions and ease anti-Tehran sanctions but reiterated that all U.S. steps will be tied to "verifiable milestones" in Iran's implementation of the deal.

"We'll do some small gestures of that in the beginning if they make some small gestures to us that show that they're willing to meet their commitments as well," he said.

In the CNN interview, Vance said that the MOU "contemplates a very significant sanctions relief package" for the Iranian people, restating that they can get the benefit only if they meet their obligations under the agreement.

Yonhap