The United States and Iran have reached a preliminary agreement aimed at ending the ongoing war in the Gulf and reopening the Strait of Hormuz, one of the world’s most critical energy corridors. US President Donald Trump confirmed the deal on June 15, just before attending a G7 summit in France, and stated that a formal signing ceremony involving Vice President JD Vance is scheduled to take place in Geneva on Friday.

The agreement comes after more than three months of conflict that began on February 28, following US and Israeli strikes targeting Iran, which resulted in the death of Supreme Leader Ayatollah Ali Khamenei and prompted retaliatory attacks across the region. The conflict has caused at least 7,000 casualties, predominantly in Iran and Lebanon, and severely disrupted global energy markets by cutting off roughly one-fifth of the world’s oil supply.

Under the terms of the preliminary deal, a 60-day ceasefire is to be extended, providing negotiators time to address complex issues such as Iran’s nuclear program. The Strait of Hormuz blockade will be lifted, allowing oil shipments to resume once mine removal and security assurances are in place. Iran has proposed sharing control of the strait with Oman, while the United States insists the strait will remain open toll-free.

Officials from both countries have yet to release full details of the agreement, though US sources have indicated that the accord could bring significant economic benefits to Iran. These include the lifting of sanctions, release of frozen foreign assets, and the establishment of a $300 billion reconstruction fund financed by neighboring Gulf allies. However, these benefits are contingent on Iran fulfilling US demands to renounce nuclear weapons development and halt support for the Hezbollah militant group.

Iranian officials maintain that they have made few concessions, continuing to deny any intention of developing nuclear weapons. The status of Iran’s uranium stockpile remains unresolved under the current terms. Furthermore, the deal falls short of US objectives related to dismantling Iran’s ballistic missile capabilities and ending its regional military influence.

Pakistan played a mediating role in the negotiations, with its government reporting that both sides agreed to an immediate and permanent cessation of hostilities on all fronts, including Lebanon. The deal represents the most significant diplomatic breakthrough in the conflict to date, though many challenges remain before a comprehensive resolution is finalized. Oil prices have already responded, falling to their lowest levels since early March following news of the agreement.