Trump Cancels Strikes on Iran, Claims Peace Deal to Reopen Strait of Hormuz is Imminent

President Donald Trump abruptly canceled a wave of scheduled military strikes against Iran late Thursday, announcing instead that the United States and Tehran are on the verge of signing a historic peace agreement to end their three-month war. Taking to social media, Trump declared that negotiations had reached a breakthrough and that the final points of a settlement had been approved by the highest levels of Iranian leadership. The sudden pivot from military escalation to diplomatic resolution marks a potential turning point in a conflict that has paralyzed global shipping and sent energy markets into turmoil.[2][5]

The proposed memorandum of understanding outlines a phased de-escalation designed to immediately relieve pressure on the global economy. According to details leaked to the press, the agreement centers on a 60-day ceasefire extension and the rapid reopening of the Strait of Hormuz. Under the framework, the United States would lift its naval blockade on the vital shipping lane, allowing a return to pre-war maritime traffic volumes within 30 days. In exchange, Washington would temporarily waive specific sanctions, permitting Tehran to resume limited oil exports during the two-month truce.[3][4]

Beyond immediate maritime relief, the 60-day window is intended to serve as a negotiating period for a broader, permanent treaty addressing Iran's nuclear ambitions. Trump has repeatedly emphasized that any final settlement must ensure Iran cannot develop a nuclear weapon, describing it as the central objective of his administration's pressure campaign. Iranian state media confirmed that the future of the country's nuclear enrichment program would be on the table during these forthcoming talks, though Tehran has historically maintained that its nuclear initiatives are strictly for civilian purposes.[3][4]

Despite the optimism emanating from the White House, Iranian officials quickly moved to temper expectations of an imminent signing ceremony. Foreign Ministry spokesperson Esmaeil Baghaei acknowledged that large portions of the negotiating text have been finalized, but he firmly denied that the Islamic Republic had formally agreed to the deal. Baghaei stated that the proposal is still being reviewed by relevant decision-making bodies in Tehran and warned that Iran would not compromise on its established "red lines."[1][6]

The diplomatic whiplash follows a highly volatile week that saw the fragile April ceasefire nearly collapse. Prior to calling off the attacks, Trump had threatened to strike Iran "very hard," specifically targeting vital energy infrastructure such as Kharg Island. The U.S. military had already launched a wave of attacks targeting Iranian surveillance and air defense systems, while Iran retaliated by launching drones and missiles at U.S. positions in neighboring Gulf states and attempting to strike commercial vessels transiting the Strait of Hormuz.[5][8]

The prospect of an end to the hostilities triggered an immediate and massive rally across global financial markets. Equities surged on the news, with the Dow Jones Industrial Average leaping more than 800 points and the S&P 500 climbing 1.3%. Investors reacted to the easing of macroeconomic anxiety, as the three-month closure of the Strait of Hormuz—a chokepoint for roughly a fifth of the world's oil supply—had severely disrupted supply chains and forced central banks to grapple with sudden inflationary spikes.[7]

Energy markets experienced a sharp sell-off as the geopolitical risk premium evaporated. Brent crude, the international benchmark, tumbled 3.5% to fall below $90 per barrel, while U.S. West Texas Intermediate dropped to roughly $87 per barrel. The decline in crude prices offers immediate relief to global consumers and businesses, though analysts caution that the market remains highly sensitive to any potential breakdown in the final stages of the diplomatic process.[7][8]

Regional allies are closely monitoring the negotiations, with Israel taking a particularly keen interest in the security implications of the pact. Following a phone call with Trump, Israeli Prime Minister Benjamin Netanyahu’s office clarified that Israel is not a party to the memorandum of understanding. However, Netanyahu expressed appreciation for the U.S. president's commitment to ensuring that any final treaty will mandate the dismantling of Iran's nuclear enrichment infrastructure, limit its ballistic missile production, and halt its financial support for proxy militant groups across the Middle East.[3][4]

The logistical framework for formalizing the truce is already taking shape, with Trump suggesting that a signing ceremony could take place in Europe—potentially Switzerland—as early as this weekend. Vice President JD Vance is expected to attend the summit to sign on behalf of the United States. However, seasoned diplomats warn that the final mile of negotiations is often the most perilous, and until the ink is dry, the possibility of last-minute spoilers derailing the fragile consensus remains a significant threat.[1][2]