The story so far:

After 40 days of war and more than 60 days of intense negotiations, the U.S. and Iran, on June 15, agreed to a memorandum of understanding (MoU) to end the war and start more substantive negotiations on contentious issues. The deal has kicked off a geopolitical storm, with Israel opposing it firmly, causing an unlikely rift between Washington and Tel Aviv. U.S. President Donald Trump, who ripped up the 2015 Iran deal, which was signed by the Obama administration, calling it the “worst deal” in America’s history, is facing backlash at home for the concessions Washington has made to Tehran. Iran’s leadership claims that they defeated the U.S. and Israel in the war and that the terms of the MoU underscored their victory. While the agreement has brought lingering post-ceasefire skirmishes between the U.S. and Iran to an end, this is not a final settlement.

What does the deal say?

The opening article of the MoU calls for a ceasefire on all fronts, “including Lebanon”. It calls on both sides to respect each other’s sovereignty and to refrain from interfering in each other’s internal affairs. The U.S. has lifted its naval blockade of Iranian ports, while Iran has taken steps to remove its restrictions on the Strait of Hormuz. The text calls on Iran to remove all impediments, including mines, within 30 days of the signing of the deal.

One of the contentious issues during the talks was Iran’s demand for access to its frozen funds and for war reparations. The text says Iran will have its funds unfrozen contingent on progress in the second phase of the talks, without specifying the amount or timeline. Iranian state media have reported that Iran has demanded that $24 billion be unfrozen. Mr. Trump and Vice President J.D. Vance have said that no American money will be paid to Iran. That could be technically correct as the frozen funds are Iranian assets held in different banks across the world under U.S. sanctions. If the U.S. lifts the sanctions, countries and banks could make the transfer.

The U.S. would also work with other regional countries to draw up a plan for Iran’s reconstruction and redevelopment, which would involve $300 billion in financing. Iran will have access to these funds if a final settlement is reached.

What commitments has Iran made?

Iran, on its part, has pledged never to make a nuclear weapon. This has been the official Iranian position for years. The Iranians had made the same pledge in the 2015 Obama-Iran deal as well. While more contentious issues such as Iran’s possession of 60% enriched uranium (which is a step away from weapons-grade purity) and Iran’s enrichment capabilities are to be discussed in the second phase, according to the text released by the White House, both sides have mutually agreed to “downblend” (dilute) Iran’s enriched material under the supervision of the International Atomic Energy Agency (IAEA). Other issues such as enrichment in Iran and the country’s nuclear needs will be discussed as part of the final deal.

Both sides also agreed to maintain the status quo until they reach the final deal — Iran will not expand its nuclear programme and the U.S. will not impose additional sanctions and deploy more troops to the region. Upon signing the MoU, the U.S. will issue waivers for the export of Iran’s crude oil, petroleum products, and other derivatives, and all associated services, including banking, transactions, insurances, and transportation.

Where does Israel stand?

For Israel, the U.S.-Iran deal appears to be a major strategic setback. Israel launched this war with the U.S. on February 28 to bring about regime change in Iran, destroy its nuclear and missile capabilities, and stop the country from supporting its non-state allies such as Hamas, Hezbollah, and Houthis. Israel had been a big proponent of a war on Iran — officials of former U.S. administrations had said Israel had pushed previous Presidents to launch strikes on Iran. After the attacks by Hamas in Israel on October 7, 2023, the Zionist state fought a multi-front war against Hamas, Hezbollah, and the then Syrian regime of President Bashar al-Assad — all Iranian allies. The fall of the Assad regime in December 2024 weakened Iran’s regional standing further, as Syria was a key link between Hezbollah and Tehran. In June 2025, Israel bombed Iran aimed at destroying its nuclear facilities. The U.S. joined in, but after a single strike, Mr. Trump enforced a ceasefire between Israel and Iran. But the 12-day war, as it is called, was only a trial run.

What Tel Aviv wanted was regime change in Tehran, which it thought would reshape West Asia with Israel being at the centre of a new unipolar regional order. But this project collapsed as Iran survived the 40 days of bombing. Iran’s stranglehold of the Strait of Hormuz and its refusal to make concessions on the nuclear issue forced the U.S. to diverge from Israel’s maximalist demands and take a more narrowed-down approach to end the war and address the nuclear question diplomatically. But to address these issues diplomatically after the war’s failure, the U.S. would have to give substantial economic concessions to Tehran. As the U.S. is doing just that, Israel, increasingly isolated and frustrated, fears that the deal would render Iran conventionally stronger, altering the regional balance of power.

Why does Lebanon matter?

Despite being cut off from the Iran-U.S. diplomatic process, Israel still possesses a key card — Lebanon. Israeli troops have occupied parts of Southern Lebanon, a Hezbollah stronghold. Hezbollah, a Lebanese Shia militia-cum-political party, is a close ally of Iran. To have a ceasefire in Lebanon, which has been mentioned in the MoU, Mr. Trump should get Israeli Prime Minister Benjamin Netanyahu on board. Since Israeli troops are present in South Lebanon, Hezbollah, which is far from defeated, is targeting the occupying force. And in the name of striking Hezbollah, Israel is bombing Lebanon.

Both Prime Minister Netanyahu and Defence Minister Israel Katz have said that the Israeli troops will not pull back from Southern Lebanon. This keeps Lebanon as a flashpoint with a potential for escalation. An Iranian delegation was supposed to travel to Geneva to start direct negotiations for the second phase on June 19, but Iran called off talks, citing Israel’s attacks on Lebanon. Mr. Netanyahu seems determined to use the Lebanon card, making the U.S.-Iran peace process complicated. Israel’s continued attacks in Lebanon and its public criticism of the Iran MoU have triggered rare public criticism of Israel from top American officials, including Mr. Trump and Mr. Vance.

Will the agreement hold?

Both Mr. Trump and the Iranians seem determined to take the peace process to the next step. Mr. Trump, who bombed Iran for 40 days, and kept a blockade on Iran for roughly 60 days, realises the massive economic costs of the war. The war was also unpopular at home and cost the U.S. billions of dollars, depleting its stockpile of weapons.

Iran, on the other hand, has emerged regionally stronger. It will restart negotiations with the U.S. without the fear of a U.S. strike. But at the same time, Iran wants long-term economic relief and security guarantees to rebuild the country and address internal resentment. While there are incentives for both sides to reach a final settlement, there are three key sticking points. The first is Lebanon. As long as Israeli troops continue occupation of Southern Lebanon, the country will remain a tinderbox. And given that Israel is critical of the U.S.-Iran deal, Mr. Netanyahu could escalate the war aimed at torpedoing the detente. The war in Lebanon posed the first test to the deal on Saturday when Iran announced that it had closed the Strait of Hormuz, citing Israeli attacks on Lebanon.

The second is Iran’s highly enriched uranium (HEU). The U.S., until recently, argued that Iran’s HEU should be taken out of the country and destroyed, whereas Iran has always opposed such a move. Mr. Trump said last week that the HEU would be diluted “either in America or in Iran”, which was a concession. A final agreement should draw up the modalities for downblending under the IAEA’s supervision, which also means that Iran should restore IAEA access to its nuclear sites.

The third issue is Iran’s ‘enrichment right’. The U.S., until the war began, opposed any enrichment on Iranian soil, which had been the Israeli position as well. Iran says it will continue to enrich uranium for civilian purposes. The final agreement should narrow the gap between these two positions as well.

Published – June 21, 2026 02:46 am IST

Iran said on Tuesday (June 16, 2026) that talks with the United States on its nuclear programme and sanctions relief would likely begin later this week, as President Donald Trump said the Strait of Hormuz would “completely open” once the foes sign their deal.

Follow the updates for the West Asia LIVE on June 16, 2026

Officials say negotiations over a final deal would take place in a 60-day window after the memorandum of understanding to end nearly four months of war triggered by U.S.-Israeli strikes on Iran is physically signed.

“Likely on Friday (June 19, 2026), at a location to be determined… a new round of negotiations between Iran and the United States to reach a final agreement will begin,” Iranian Foreign Minister Abbas Araghchi said.

“In the final agreement, decisions will be made on the nuclear issues and the lifting of sanctions,” he added. According to Iran’s deputy Foreign Minister, Mohammad Bagher Ghalibaf, the Islamic Republic’s top negotiator, will attend the signing in Switzerland.

The U.S. side will be represented by Vice President J.D. Vance, who said Mr. Trump himself might also attend. The developments came after Mr. Trump said an Iranian blockade on the crucial Hormuz Strait oil and gas route would be fully lifted by the same day, which would be a major boost to the global economy.

The U.S. had, in retaliation, imposed its own blockade on Iranian ports. “Ships are starting to move, many loaded up with Oil, out of the Strait of Hormuz,” Mr. Trump said on Monday (June 15, 2026), adding later that he did not “think we will need much help” keeping the waterway open.

Sporadic episodes of violence since an April ceasefire had threatened a deal, but weeks of indirect negotiations mediated by Pakistan and Qatar built momentum for an interim agreement. Yet a comprehensive agreement on Iran’s nuclear ambitions and Western sanctions remains unsolved.

Washington and close ally Israel are pressing to strip Iran of its stockpile of highly enriched uranium, said to have been buried by U.S. strikes last year, while Iran has insisted on its right to enrich uranium. The agreed framework has however paved the way for talks on those key disputes.

Powerful document

Asked at the G7 in France when the text would be released, Mr. Trump said, “It’s a very powerful document, and I want it to be released. So probably pretty soon.”

G7 Summit Day 1 LIVE

But he told The New York Times the U.S. was still negotiating whether Iran would suspend enrichment for 20 years, hinting he might settle for 15.

Iran’s military hailed the accord as a victory, claiming it had “humiliated” the U.S. and Israel, while President Masoud Pezeshkian called it “a great achievement” for the region. The ultraconservative newspaper Vatan-e Emrooz praised the agreement as a “Trump surrender document”.

But Mr. Araghchi struck a more cautious note. “We have a history of broken commitments… we have a history of agreements being torn up. All of this is present in our minds,” he said.

A senior U.S. administration official, however, said Mr. Trump, Mr. Vance and negotiator Mr. Ghalibaf had already signed the text electronically. In a flurry of interviews to talk up the deal, Mr. Vance said no U.S. taxpayer money would go to Iran under the deal, as Iranian media reported $12 billion of frozen assets would be released.

Mr. Vance told NBC that U.S. and UN nuclear inspectors will be allowed to enter Iran. “One of the core parts of the agreement is that the International Atomic Energy Agency and the United States are going to help Iran destroy the highly enriched stockpile, and that’s something that’s spelt out very clearly” in the MoU, Mr. Vance said.

“We are not investing any money” in Iran, Mr. Trump said at the G7 summit in France after talks with the emir of Qatar, adding that the main focus of the deal was that Iran would not acquire a nuclear weapon and that “all hell” would “rain down” on the country if it did.

Lebanon crucial to deal

Analysts have warned that the parallel conflict in Lebanon between Israel and Iran-backed Hezbollah presents the biggest threat to the diplomatic thaw. Lebanon was pulled into the war in March when Hezbollah launched rockets at Israel after the killing of Iran’s supreme leader, prompting Israeli strikes and a ground invasion.

That theatre of the conflict could be “the biggest ultimate spoiler” of the coming negotiations, said Ross Harrison, a senior fellow at the Middle East Institute. Israeli figures quickly condemned the deal, and Prime Minister Benjamin Netanyahu pledged that the country’s forces would remain in Gaza, Lebanon and Syria “for as long as necessary”.

But Mr. Araghchi on Tuesday (June 16, 2026) said that ending the war on all fronts, including Lebanon, was “the most important” issue in the peace deal announced with the United States. “Ending the war in Lebanon is an inseparable part of the complete end of the war” he added.

Published – June 16, 2026 06:19 pm IST