US-Iran Peace Deal: After 107 days of conflict in the Middle East, the United States and Iran are set to hold historic peace talks on Friday at the Burgenstock Resort in Switzerland. The venue has been chosen for the formal signing of the US-Iran agreement aimed at consolidating the ceasefire and ushering in a new phase of diplomatic engagement between the two nations.
US President Donald Trump formally signed the agreement during the G7 Summit in Evian-les-Bains, France. The deal is expected to facilitate the reopening of the strategically vital Strait of Hormuz.
What Is the 14-Point Agreement?
Earlier on Wednesday, US President Donald Trump signed a 14-point preliminary draft of the Memorandum of Understanding (MoU) alongside French President Emmanuel Macron during a dinner at the Palace of Versailles in France. The agreement has been named the Islamabad Memorandum of Understanding.
The 14-point agreement states that Iran will never possess a nuclear weapon and includes provisions for a 300 billion dollars fund for the country's "reconstruction and economic development", although the United States is not obligated to contribute financially. The agreement comes four months after the conflict involving Iran, the United States and Israel erupted.
The Trump administration has described the agreement as "performance-based", under which Iran will receive benefits only if it complies with its commitments.
Iranian President Masoud Pezeshkian also signed the agreement in Tehran, while Pakistani Prime Minister Shahbaz Sharif signed it as a mediator and guarantor. US Vice President JD Vance said the agreement came into effect immediately following the digital signatures.
The peace agreement was originally scheduled to be signed in person in Switzerland on Friday. However, according to a BBC report, it was approved earlier to avoid delays in critical negotiations.
Pakistan, Qatar to Attend Talks
According to Reuters, citing the Swiss Foreign Ministry, officials from Pakistan and Qatar will also participate in the talks alongside representatives from the United States and Iran.
However, the detailed schedule and agenda of the meeting have not yet been made public.
According to The New York Times, global markets reacted positively to the announcement of the agreement. International crude oil prices declined, while major stock markets registered gains.
Oil prices fell nearly 2 per cent to a three-month low of 78 dollars per barrel, while shipping activity through the Strait of Hormuz increased.
Three Saudi supertankers leave Hormuz
Three Saudi Arabian supertankers have reportedly departed the Strait of Hormuz for the first time since the Iran-Iraq War. Several other vessels are also said to have resumed movement through the strategic waterway.
Experts, however, believe that it could take around a month for maritime traffic to return to normal levels and until October for oil production to fully recover. They estimate that crude oil prices could eventually fall to around 60 dollars per barrel.
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Mojtaba Khamenei's First Message After Iran-US Deal
Iran's Supreme Leader Ayatollah Mojtaba Khamenei on Thursday issued his first public statement following the digital signing of the US-Iran draft Memorandum of Understanding (MoU). He outlined his position on the agreement and explained why he ultimately approved it despite initial reservations.
Mojtaba said he had concerns about the MoU with the United States at first. However, he approved it after receiving assurances from President Masoud Pezeshkian and senior security officials that Iran's national interests would be safeguarded.
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US Defence Secretary Lashes Out at NATO Allies
Meanwhile, US Defence Secretary Pete Hegseth criticised NATO allies for what he described as a lack of support for the United States during the Iran conflict.
He said that without America, NATO is a "paper tiger". Citing the allies' approach during the conflict, Hegseth said the United States has decided to reduce the number of troops stationed in Europe.
He also hinted at establishing the primary US military base in Poland. Currently, the main American military base in Europe is located in Germany.
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Addressing NATO defence ministers at the alliance's headquarters in Brussels, Hegseth said the NATO allies' stance during the Iran war was "shameful" and warned that such a one-sided relationship would not continue indefinitely.