US-Iran Armistice MOU Takes Effect...Trump Says "Wanted to Avoid Economic Catastrophe"

Aiming to Expedite Normalization of the Strait of Hormuz
Signing Ceremony Still Set for the 19th in Switzerland
Key Issues Including Nuclear Abandonment to Be Discussed Over 60 Days
WSJ: "This Agreement Is a Political Gamble"

The memorandum of understanding (MOU) for ending the war between the United States and Iran has reportedly begun to take effect ahead of the originally scheduled official signing ceremony. U.S. President Donald Trump stated that he sought the agreement to avoid an economic shock caused by a prolonged war with Iran, effectively acknowledging that oil prices and financial market instability influenced the decision to end hostilities.

On June 17 (local time), Axios reported that the United States and Iran had remotely completed electronic signatures on the MOU, and the agreement was already in effect. Initially, both sides had planned to hold an official signing ceremony in Switzerland on June 19. However, Axios said the timeline for signing and implementation was moved up to expedite the reopening of the Strait of Hormuz.

The signing ceremony will take place as planned in Switzerland at Bürgenstock. Vice President J.D. Vance and Iran's parliamentary speaker Mohammad Bagher Ghalibaf are expected to lead their respective delegations and discuss the start of negotiations on Iran's nuclear program.

However, there is still confusion regarding the timing and procedure of the signing. A senior U.S. official explained that the MOU had already been electronically signed on Sunday by President Trump, Vice President Vance, and Speaker Ghalibaf. However, according to Axios, diplomatic sources from the mediator country denied such a signing had taken place. Another source claimed the signing did occur on Sunday and that the upcoming signing would be a “second signing.” Axios reported that the reason for two separate signings remains unclear.

End of Hostilities Driven by Financial Markets, Oil Prices, and Election Burdens... Follow-up Negotiations Key

At a press conference during the Group of Seven (G7) summit in France on the same day, President Trump defended the agreement to end the war, saying, “I did not want to see economic catastrophe.” He referenced Herbert Hoover, the U.S. president during the Great Depression, and added, “He was someone I did not want to become.”

The Wall Street Journal interpreted President Trump’s remarks as an effective admission that the truce and negotiations were prompted by the surge in oil prices and instability in financial markets caused by the prolonged conflict with Iran, as well as concerns over inflation ahead of the midterm elections. Until last month, President Trump had denied that the economic burden on Americans was a factor in the ceasefire talks, saying, “Not at all.”

The agreement is focused on the reopening of the Strait of Hormuz and allowing Iran to resume crude oil exports. The United States will suspend sanctions on Iranian oil sales, and Iran will resume the passage of merchant ships. The agreement reportedly includes a provision that no transit fees will be charged to merchant vessels for 60 days.

However, key issues such as the method of dismantling Iran’s nuclear program, handling of highly enriched uranium, ballistic missile concerns, and support for pro-Iranian armed groups have been deferred to follow-up negotiations to be held over the next 60 days. Iran has promised not to pursue nuclear weapons, but this has been its repeated position in the past. How the nuclear program will be limited and verified must be determined in future negotiations.

Economic Compensation in Return for Iran’s Agreement... Trump’s Political Gamble

Iran will receive economic compensation on the premise of implementing the agreement. The United States plans to allow financial transactions and sanctions waivers necessary to establish a fund of 300 billion dollars for Iran’s reconstruction, as well as providing access to previously frozen assets. However, the Trump Administration drew a clear line, stating that U.S. government funds would not be directly used, and that economic benefits would be offered only if Iran demonstrates what the United States considers “good behavior.”

President Trump said of Iran’s frozen assets, “That is not our money, it is their money,” adding, “At some point, it will have to be returned.” At the same time, he warned that if Iran fails to honor the agreement, “We will resume bombing until they comply.” This was interpreted as a rebuttal to domestic criticism that the agreement was too favorable to Iran.

The Wall Street Journal noted that the agreement also represents a major political gamble for President Trump. While it is based on the assumption that Iran will choose economic recovery over nuclear development, the MOU is not a final peace treaty but rather a provisional commitment to continue follow-up negotiations.

President Trump also suggested he could tolerate Iran retaining some ballistic missiles and said that blocking access to nuclear weapons is more important than securing highly enriched uranium. This could spark backlash from hardliners in the United States and Israel who had sought to completely neutralize Iran’s military capabilities.

This content was produced with the assistance of AI translation services.