US and Iran near deal to extend ceasefire and reopen Strait of Hormuz

The war began with US and Israeli strikes across Iran on 28 February, prompting Iran to attack Israel and US-allied states in the Gulf and to close the Strait of Hormuz, a key shipping route for the world's oil and liquefied natural gas.

Despite a ceasefire agreed in April, the US and Iran have exchanged intermittent fire, including two rounds of tit-for-tat strikes this week.

US President Donald Trump said on Thursday that he had cancelled scheduled attacks against Iran because negotiators had just made a great settlement, a deal that was likely to be signed imminently.

On Friday, Iranian media published some details from the alleged 14-point deal. Trump said the report had nothing to do with the terms that were agreed to and bears no relation to the truth.

A few hours later, Pakistani Prime Minister Shehbaz Sharif, whose country helped mediate the deal, said the memorandum of understanding between the US and Iran had been agreed and awaited finalising.

Iran's Araghchi was quoted in state media saying there are supporters and opponents of the latest terms among Iran's top security body, the Supreme National Security Council. He added that a collective decision had not been reached. For now, we must wait, he said. If approved, the agreement will be signed remotely.

Israel is not involved in the talks, which are meant to lead to an extension of the ceasefire and the start of negotiations on key issues, including Iran's nuclear programme. For decades, Iran has been accused by Western countries of trying to build a nuclear weapon. It has denied the accusations, saying its programme is for peaceful purposes to generate electricity and for research.

In a detailed briefing with journalists on Friday afternoon, US officials said the deal would reopen the Strait of Hormuz in return for the US lifting its blockade on Iranian shipping. Those steps would come into effect more or less immediately. This would be followed by a 60-day period of negotiation focusing on Iran's enriched uranium, an essential ingredient to make a nuclear bomb. Officials said that this would result in all that material being destroyed on site and then removed from the country, though the precise mechanism for doing so is still to be worked out.

On the economic side, officials stressed there would be no money provided up front, an apparent rejection of earlier Iranian news reports suggesting some Iranian assets would be unfrozen before substantial negotiations had begun. Instead, US officials said, there would be a staged reintegration of Iran into the global economy, with measures such as the lifting of sanctions and the potential unfreezing of assets happening incrementally.

The US officials emphasised that the memorandum of understanding was not based on trust or promises, but on performance. Iran would only receive economic benefits when it could be verified that it had implemented measures it had committed to.

Even though there is a sense of cautious optimism from all sides, the US, Iran, Pakistan and Qatar, which has also helped with mediation efforts, there is still a small distance to go. Variations of this agreement have been expected several times over the past month or two, only to fall away at later stages.

The difference now, according to the US administration, is both a greater level of optimism and a greater openness about the substance of the agreement. For his part, the Iranian foreign minister said that as soon as the final stages of our negotiations are completed, this agreement will be signed and announced.

As for the Strait of Hormuz, the crucial waterway through which some 20 percent of the world's oil and liquefied natural gas normally transits, Araghchi said its administration would no longer be the same as before. Since closing the Strait, Iran has insisted on a fee to be paid by vessels seeking to cross, with the US insisting passage should be free to all shipping.