The United States and Iran are poised to formally sign a memorandum of understanding (MOU) on June 19 in Switzerland, following an earlier digital signing on Sunday. This interim accord, described by US Vice President JD Vance as a "very rough document" of about a page and a half, aims to establish a 60-day ceasefire and halt active hostilities. While both nations claim victory, the full text of the MOU has not yet been released, raising questions and leading to speculation about its exact terms, particularly surrounding financial incentives and the reopening of the Strait of Hormuz.
The deal includes a 60-day halt to fighting, effective upon the formal signing, and sets the stage for two months of negotiations on Iran's nuclear program and other issues. A near-final draft seen by Bloomberg News indicates that Iran is set to receive sanctions waivers allowing immediate oil sales, with other financial incentives deferred. The agreement also provides for the suspension of specific petroleum-related trade restrictions, which has already caused crude oil prices to fall to multi-month lows, and is expected to lead to the reopening of the Strait of Hormuz within 30 days of signing. This has driven the US industrial equity benchmark up by approximately $2.1$ percent to a record $1,519.18$.
One of the most contentious points revolves around the release of frozen Iranian capital and the potential establishment of a $300 billion investment fund for Iran. Iranian state-affiliated Mehr News agency reported that the 14-point draft MOU provides for the release of $24 billion in frozen Iranian assets, a figure which US Vice President JD Vance disputes, stating it "just doesn't appear anywhere in any of the texts." Other reports reference figures around $12 billion up to over $100 billion. The idea of an investment fund, which The New York Times quoted sources saying would not come from governments but from companies eager to invest in Iran, is intended to help Iran, where the war inflicted an estimated $29 billion in damage and the population faces high inflation.
Differing accounts also exist regarding the Strait of Hormuz. President Donald Trump has emphasized that passage would be "toll-free," stating it would remain open without charges, as it was before the war. However, senior US officials indicated that toll-free passage would apply for 60 days, with the imposition of fees afterward remaining undecided. Iran's Foreign Ministry spokesman, Esmail Baghaei, stated that Iran was not seeking to collect transit tolls but would design and levy charges for navigation services, insurance, and environmental protection.
Implementation risk remains a primary concern as the MOU defers hard structural questions to the 60-day negotiation window. There are no contractual guarantees that this period will yield a durable resolution, and analysts describe the agreement as tentative. Iranian Foreign Minister Abbas Araghchi noted that while the memorandum would bring economic benefits, Tehran would not solely rely on them, citing Iran's history of "broken promises, non-compliance, and the tearing up of agreements" when discussing the upcoming sanctions and nuclear program negotiations.
