U.S.-Iran accord gives Iran and Oman future Strait role
The memorandum ends U.S.-Iran fighting but leaves Iran’s nuclear program in place and unlocks major funding, drawing criticism from allies.
By Maya Lindqvist · Senior Technology Correspondent
3 min read
A new U.S.-Iran memorandum has halted fighting between the two countries while setting up a short negotiating window for a fuller agreement, according to Fortune and the text published by the BBC. The terms matter for energy markets and regional security because they reopen the Strait of Hormuz while giving Iran and Oman a future administrative role there.
According to the BBC’s published text, the memorandum calls for an end to hostilities and creates an extendable 60-day period for talks on a more detailed pact. Fortune reported that the follow-on agreement is expected to include a mechanism for monitoring compliance.
The nuclear language leaves one of the central disputes only partly settled. The memorandum bars Iran from acquiring nuclear weapons, according to Fortune’s summary of the text, but it also says Iran will keep the current status of its nuclear program.
The Strait of Hormuz provisions are likely to draw close scrutiny from shipping companies and oil traders. The memorandum says blockades of the waterway will end and commercial vessels will be allowed passage without charge for 60 days, according to the BBC-published text cited by Fortune.
After that period, the memorandum assigns the Strait’s future administration and maritime services to Iran and Oman, Fortune reported. Fortune said that wording appears to leave room for fees later, though the memorandum’s reported terms specify no charge only during the initial 60-day period.
Funding and asset relief
The deal also includes major financial provisions for Iran. Fortune reported that Iran is set to receive a $300 billion investment package, with the funding coming mainly from international partners.
In addition, $100 billion in Iranian assets will be unfrozen, according to Fortune’s account of the memorandum. The report did not specify the timing or jurisdictions involved in the asset release.
The memorandum does not mention Hezbollah, according to Fortune. That omission drew attention because Israel continued strikes in southern Lebanon during the past 24 hours, the BBC reported in live coverage cited by Fortune.
Allied criticism
Fortune reported that many governments welcomed the end of the war and the return of trade through the Strait. At the same time, U.S. allies were angry that the memorandum leaves Iran’s nuclear power program intact, does not address Hezbollah attacks on Israel and strengthens Iran’s position in the Gulf, according to Fortune.
Israeli Prime Minister Benjamin Netanyahu views the agreement as a strategic disaster, Axios reported, according to Fortune. Fortune said Netanyahu’s position is that the memorandum leaves Israel facing Iran without the same U.S. backing.
Republican critics in the United States also attacked the agreement. Former Vice President Mike Pence called it “appeasement,” according to BBC live coverage cited by Fortune.
Sen. Bill Cassidy, a Louisiana Republican, said the memorandum was “the worst foreign policy blunder in decades,” according to the same BBC coverage cited by Fortune. The White House response to those criticisms was not included in Fortune’s report.
This story draws on original reporting from Fortune.