By Nana Karikari, Senior Global Affairs Correspondent
Iran insisted Friday that a final decision to end its war with the United States has not been reached, directly challenging President Donald Trump’s sweeping announcement that a peace deal is imminent. The diplomatic friction came hours after Trump abruptly canceled a fresh round of military strikes on Iran, claiming negotiators had just achieved a “great settlement” to halt the months-long conflict.
Speaking from the Oval Office, Trump declared a major breakthrough. He asserted that a formal agreement is being finalized and predicted a signing ceremony in Europe within days. However, Iran’s Foreign Ministry spokesperson, Esmail Baghaei, quickly countered the White House, calling reports of a finalized agreement “speculative” and stating plainly that “nothing has been finalized.”
The surprise development capped 48 hours of heavy military escalation. Just hours before reversing course, Trump had warned on social media that the U.S. military would hit Iran “VERY HARD TONIGHT” and seize its primary energy infrastructure. The sudden pivot back to diplomacy highlights Trump’s rapid shifts between severe threats and absolute peace claims.
Diplomatic Breakthrough or Premature Rhetoric
The administration framed the development as a decisive resolution to the war, which began on February 28 when joint U.S. and Israeli forces launched wide-ranging strikes on Iran. Trump described the emerging framework as a “very strong memorandum of understanding,” though he admitted the details remain “a little conceptual.”
“We have a deal that Iran will never have a nuclear weapon, which was the whole purpose of what we had to go through to get this,” Trump told reporters. He added that the accord would secure the reopening of the blockaded Strait of Hormuz “as soon as we have it signed.” Trump claimed he spoke to regional leaders, including Gulf allies and Israeli Prime Minister Benjamin Netanyahu, asserting that “the whole Middle East is very happy.”
Tehran quickly tempered Washington’s triumphalism during a live phone call on state television. Baghaei confirmed that while mediators were active, Iran has not reached a final decision regarding any agreement.
“The problem is that the contradictions in America’s position have caused turbulence to this process,” Baghaei said Thursday night. He noted that while the text of a memorandum is mostly finalized, Washington introduced “excessive demands” and “new requests.” He emphasized that Tehran would not “depart from its red lines.”
This is not the first time the American president has claimed a resolution was close without one materializing. Trump previously suggested a deal was near on April 20, before declaring himself “not satisfied” with the terms on May 27. Independent analysts remain skeptical of the current timeline. Political science professor Robert Pape noted that the conflict is “not at an endgame, we’re in the middle game.”
Details of the 14-Point Document Leaked
Iranian state media provided further clarity on Friday morning regarding the specific terms under discussion. According to reports, the draft version of the Iran-U.S. memorandum of understanding contains an explicit commitment from Washington to lift oil sanctions. In return, Tehran would commit to fully reopening the Strait of Hormuz to all marine traffic within 30 days.
The Mehr News Agency reported that the framework is structured as a rigid 14-point document. The text dictates that final negotiations cannot officially begin until a series of preconditions are met by Washington. These conditions include the suspension of current oil sanctions, the complete lifting of the U.S. naval blockade, and the release of half of Iran’s frozen financial funds.
Additionally, the Iranian state media report details expansive geopolitical demands. The draft mandates that all American forces must withdraw from Iran. Additionally, the text stipulates that the U.S. and its international allies would need to present formal reconstruction plans for Iran valued at a minimum of $300 billion.
A Rapid Sequence of Tit-for-Tat Escalations
The diplomatic opening follows two days of intense military exchanges that threatened to plunge the region into an uncontained war. The latest friction began on Monday when a U.S. Apache attack helicopter crashed in the Persian Gulf. Both pilots were rescued
safely. Trump blamed Iran for downing the aircraft. The U.S. military then launched a wave of retaliatory strikes on Wednesday. U.S. Central Command confirmed these operations targeted military, surveillance, and radar installations across southern Iran.
Iran’s Foreign Ministry warned that the U.S. attacks had “effectively rendered the ceasefire… meaningless.” The Islamic Revolutionary Guard Corps then retaliated, launching strikes against American bases in Bahrain, Kuwait, and Jordan.
Jordanian forces reported shooting down approximately 20 Iranian missiles. Kuwait’s military stated that its forces engaged hostile aerial targets. Local authorities in Bahrain reported that an Iranian drone strike injured an 11-year-old girl. The strike also caused extensive damage to civilian homes and vehicles.
In response to the mounting violence, UN Secretary-General António Guterres expressed deep concern through a spokesperson. Guterres urged all parties to “return to the full implementation of the ceasefire and avoid any further deterioration.” A chorus of international powers—including Pakistan, Russia, China, Turkey, India, and Saudi Arabia—simultaneously issued urgent calls for de-escalation.
The Core Sticking Points of the Conflict
Despite the apparent progress achieved via Qatari mediators in Tehran this week, deep geopolitical rifts persist. The primary U.S. and Israeli objective remains the permanent containment of Iran’s nuclear program. Western intelligence fears Tehran’s stockpile of highly enriched uranium could be used to build an atomic weapon. Iran maintains its research is purely peaceful.
This underlying anxiety was magnified early Friday. Iran’s state-run broadcaster, IRIB, aired a 3D graphic simulating a nuclear explosion over a city. The network quickly issued a correction. It stated that the broadcast was an internal “editing error” and not the result of a cyberattack.
Regional alliances further complicate the diplomatic path. Iran continues to insist that any comprehensive peace agreement must end fighting in Lebanon between Israel and the Tehran-backed militia Hezbollah. Conversely, Netanyahu appears intent on pursuing his goal of destroying the militant group.
Netanyahu’s office took steps to distance Israel from Trump’s immediate bilateral negotiations. His office issued a statement confirming that Israel “is not a party to the memorandum of understanding.” The statement noted that Netanyahu expressed appreciation for Trump’s commitment to work toward an agreement that included “the removal of enriched material, the dismantling of enrichment infrastructure, limits on
missile production, and the cessation of Iran’s support for its terrorist proxies in the region.” However, an Israeli source noted that Trump’s announcement caught the prime minister by surprise during an active security discussion.
The Strategic Threat to Kharg Island
The economic stakes of the conflict were laid bare on Thursday morning. Trump threatened to seize Kharg Island in the north of the Gulf. The installation handles roughly 90% of Iran’s crude oil exports. Trump wrote online that the U.S. would take “total control” of Iran’s energy markets “much like we have with Venezuela.”
The threat provoked fierce pushback from Iranian leaders. Mohammad Bagher Ghalibaf, Iran’s top negotiator and parliamentary speaker, warned on social media that “wrong strategies and impulsive decisions” would “explode energy infrastructure and markets and create an endless quagmire that you will be stuck in for years.” He warned Trump, “You will see a different Iran.” The Iranian military similarly stated, “either oil and gas exports are for everyone or they will be available for no-one.”
Trump later walked back the invasion threat during an interview with Fox News. He cited a lack of domestic political will for a prolonged ground campaign. “I don’t know that America has the stomach for it, to be honest,” Trump admitted. “I don’t want to have boots on the ground.” He added, “But if I wanted to, we could put a small group of soldiers and take over the place.”
Pentagon and administration officials confirmed that high-risk plans to capture Kharg Island have existed for months. Wiping out the island’s energy infrastructure would effectively bankrupt Iran and end its war capabilities. However, advisers warned Trump that the operation would require a significant number of ground troops and could result in heavy U.S. casualties. Due to those calculations, the Pentagon considered the plan an “endgame” option of last resort. Iran had been preparing for months by laying traps and moving air defenses to the island.
Economic Strain and Blockade Collateral Damage
The urgency to secure a deal is being driven by severe global economic pressure. The World Bank released a report Thursday projecting that the war will slow global economic growth to 2.5% this year. This is down from 2.9% in 2025, marking the weakest expansion since the Covid-19 pandemic. The report warned that if energy supply disruptions prove more severe, global growth could fall to just 1.3% in 2026. Fertilizer and food prices have already spiked.
The high stakes surrounding the blockaded Strait of Hormuz continue to anchor these macroeconomic worries. Roughly 25% of the world’s seaborne oil trade and 20% of global liquefied natural gas (LNG) pass through the strategic route, rendering it a massive global economic chokepoint.
Though news of a potential settlement caused Brent crude prices to drop initially to around $89 a barrel, energy executives have privately warned the White House that industry oil stockpiles are running dangerously low. The government’s Strategic Petroleum Reserve is also being rapidly depleted. This will force the administration to slow its pace of withdrawals next month.
“The SPR is going to be precariously low,” an industry source said. “What comes next is higher prices.” Another source added, “We are getting closer to the bottom.” Exxon recently stated that it was approaching “unheard of inventory levels.” Executives warned that July is the likely pain point when the market turns volatile. In response, White House spokeswoman Taylor Rogers stated that Trump and his team anticipated short-term market disruptions and implemented an aggressive plan to mitigate impacts.
Despite the long-term warning signs, global stock markets surged on Friday on mounting hopes that a comprehensive peace deal would be finalized. Energy markets continued to experience downward relief as a result. U.S. crude oil futures for July delivery fell by 1.61%. Concurrently, August futures for the international benchmark, Brent crude, dropped by 1.75%.
The enforcement of the U.S. naval blockade has also severely strained Washington’s diplomatic relationship with India. The blockade aims to stop ships from entering and leaving Iranian ports. On Wednesday, U.S. forces disabled a Guinea-Bissau-flagged tanker, the M/T Jalveer. It was transporting Iranian oil and failed to obey U.S. orders. It is the ninth merchant vessel disabled during the campaign.
A separate U.S. strike on Tuesday against a Palau-flagged tanker, the M/T Settebello, killed three Indian national seafarers in the Sea of Oman. A U.S. aircraft fired precision munitions into its engine room. Twenty-one crew members were rescued.
U.S. Central Command maintained that American forces issued warnings before firing on the ship. The leader of the International Maritime Organization condemned the attack. The incident triggered intense public fury in India. New Delhi has formally summoned a senior American diplomat. India urged Washington to halt strikes on commercial shipping. This adds fresh friction to a bilateral relationship already weighted down by steep U.S. trade tariffs and economic strains.
Conflicting Strategic Realities
The coming days will test the validity of Washington’s diplomatic optimism. Trump listed a broad coalition of approving nations, including Saudi Arabia, the UAE, Qatar, Turkey, Pakistan, and Egypt. The geopolitical reality remains complex, as U.S. officials maintain that the economic blockade of Iranian ports will continue fully active “until this Transaction is finalized.”
Yet inside Iran, the political establishment remains highly distrustful. Ebrahim Rezaei, spokesperson for the Iranian parliament’s National Security and Foreign Policy Committee, warned colleagues to remain on a war footing. “The probability of deception by Trump is high,” Rezaei stated, urging Iran to continue its attacks rather than yield to a premature peace claim.
