From JCPOA exit to the 2026 deal: How US-Iran ties soured under Trump

The United States and Iran are set to sign an initial agreement in Geneva on Friday, mediated by Pakistan, to end the US-Israel war on Iran and begin 60-day negotiations. While details are undisclosed, US President Donald Trump emphasized Iran's nuclear program as a key concern. Relations between the two countries deteriorated significantly under Trump, beginning with the US withdrawal from the 2015 Joint Comprehensive Plan of Action (JCPOA) in May 2018. Following the withdrawal, the US imposed new sanctions on Iran in August and November 2018, targeting various sectors including oil and banking. In April 2019, Trump designated Iran's Islamic Revolutionary Guard Corps (IRGC) as a foreign terrorist organization, leading to retaliatory measures from Tehran.

A US-Iran memorandum of understanding, expected to be signed soon, could lead to the establishment of a $300 billion investment fund for Iran. US Vice President JD Vance stated that access to this fund is contingent on Iran's performance in adhering to the deal, particularly regarding nuclear program inspections. The Trump administration insists this fund is not a direct payout for enriched uranium, but rather an incentive for Iran to rejoin the global economy. Sources suggest the fund would be created by companies eager to invest, not directly from governments. This potential deal aims to end a war that has caused significant damage and economic hardship in Iran, though Tehran may view the conditional nature of the fund as a "dignity problem." Discussions will also address Iran's nuclear program.

A US-Iran deal is reportedly being finalized, with nuclear inspectors set to return to Iran as part of an agreement to end the war. An estimated $24 billion in frozen Iranian assets will be released in four installments. However, these assets are contingent on Iran allowing the toll-free reopening of the Strait of Hormuz and agreeing to certain "understandings" regarding upcoming nuclear talks. JD Vance described the deal as "very general" with many details still to be negotiated.

The White House announced that nuclear talks with Iran have commenced following the signing of a framework agreement. This memorandum of understanding, as described by the White House, represents only a preliminary framework for further discussions. The article does not specify the exact timing or location of these talks, nor does it detail the specific reasons for the agreement beyond its nature as a framework. The key actors involved are the United States and Iran, with the White House making the announcement regarding the initiation of talks based on the signed framework.

Asian nations are experiencing a mix of relief and wariness regarding a US-Iran peace deal, set to be signed in Switzerland on Friday, mediated by Pakistan. The agreement aims to end over three months of conflict in the Gulf, lift the US blockade on Iran, and reopen the Strait of Hormuz, a critical oil chokepoint. This waterway is vital for energy-importing Asian economies, as it handled approximately 20 million barrels of oil daily in 2024, representing 20% of global consumption. While the deal promises immediate relief, regional leaders are awaiting confirmation of the Strait's reopening and a subsequent easing of oil prices. Analysts suggest that the agreement's long-term success will depend on its ability to navigate ongoing nuclear talks and persistent geopolitical distrust.

Following a preliminary deal between the United States and Iran, oil prices have plunged, signaling market optimism. This development has raised questions about whether Chinese firms previously sanctioned for Iran-related business will experience immediate relief. Analysts express caution, noting that while new Iranian oil purchases may not face fresh sanctions, existing sanctions on Chinese importers are unlikely to be lifted swiftly. The US-Iran accord reportedly includes commitments to lift maritime blockades and issue waivers for Iranian oil exports, with a pathway to broader sanctions relief under a future final agreement.

Markets reacted positively to a US-Iran peace deal that will reopen the Strait of Hormuz, causing oil prices to fall to a three-month low of $83 a barrel and wholesale gas prices to drop 6%. This disruption, lasting over 100 days, had significantly impacted global energy supplies. However, a full return to pre-crisis oil and gas supply levels is expected to take months, even with the reopening of the crucial trade route. Buyers are now focused on replenishing depleted emergency crude stockpiles, which could keep prices between $80 and $90 a barrel for the remainder of the year. Damage to Qatar's gas processing facilities and the need to restart production in Iraq and Kuwait will further delay the return of normal gas and oil exports.