How the US and Iran Might Spin Their Deal to End the War

**SPEAKER_1** (0:02)
Bloomberg Audio Studios, Podcasts, Radio, News.

**SPEAKER_2** (0:07)
We start the week with the news that we have all been waiting for for months, a Middle East deal on the prospects and not quite in time.

**Sarah Holder** (0:16)
The US and Iran announced a proposed interim peace agreement that would end nearly four months of fighting and reopen the Strait of Hormuz.

**SPEAKER_4** (0:24)
Trump's saying, the Strait will reopen entirely and toll free after the deal is signed later this week, saying, ships of the world, start your engines, let the oil flow.

**Sarah Holder** (0:35)
Brent Oil traded below $85 a barrel in reaction to the news, down from a peak of over $125 a barrel at the height of the war.

**SPEAKER_5** (0:44)
And the stock market is shooting up like a rocket today, like record kind of numbers.

**Sarah Holder** (0:50)
But neither the US nor Iran has released the text of the 14-point negotiating blueprint, what they're calling a Memorandum of Understanding, which is scheduled to be signed Friday. And Israeli officials said on X that they are not bound to the agreement. This is The Big Take from Bloomberg News. I'm Sarah Holder. Today on the show, Bloomberg's national security editor Nick Wadhams on the US and Iran's latest Deal to Make a Deal, what it will take for the two sides to come together and what it means for global markets.
Nick, neither the US or Iran has yet released details of what is in this memorandum of understanding. But based on what you're hearing, what are the main areas that the two sides have agreed to hash out over the coming days?

**Nick Wadhams** (1:44)
What we're seeing here are broad contours right now with not a lot of specifics. And the main things are, one, essentially extending the ceasefire between the US and Iran for a further 60-day halt in fighting. And then, as quickly as possible, reopening the Strait of Hormuz to get oil flowing again. Obviously, markets have responded quite favorably to that. But there is so much here we do not know. And we just got off of a briefing with a senior administration official talking to reporters.
And they made clear that essentially there's going to be a 60-day window where the Strait will be open. But a lot of the details and mechanics about how ships will pass through the Strait in the future still has to be negotiated. So it's a little bit of a situation where the more we learn about this memorandum of understanding, the narrower its objectives seem to be and the more it seems to leave the thorniest issues for later.

**Sarah Holder** (2:42)
In a sea of unknowns, the clearest outcome from these talks over the weekend is that Strait of Hormuz will reopen for this 60-day window. Talk through what that actually means, what mechanics still have to be negotiated and how long it could take global shipping operations to go back to normal during these 60 days or beyond.

**Nick Wadhams** (3:02)
Well, there are a bunch of things there. One, we don't know how many mines are actually in the Strait of Hormuz right now. So what you've heard President Trump say yesterday was essentially, OK, we're going to sign this deal on June 19th because we need those four or five days to clear the mines from the Strait and essentially reassure shippers that they can send their vessels through. We had senior administration officials on a call this morning telling us they had actually already signed the deal and shipping should resume almost immediately, though they didn't expect traffic to really get back to more robust levels for a couple of weeks.
The big issue there of course is that as much as the US and even Iran can offer those reassurances, it's the shippers that are going to decide whether they want to risk sending their ships through that very narrow waterway. And so far everything we're hearing from the shippers is they are not ready to just sort of fire up the engines and head through the Strait. They want to wait and see, they want to see the text of the document itself, and they also want reassurances about what's going to happen. It seems right now that Iran will not charge any tolls for ships moving through. But what we do know is that Iran has already made some indications that it's going to charge sort of a service fee, which feels a little bit like a toll by another name. But again, those details have not been explained to us.

**Sarah Holder** (4:27)
In terms of the timeline here, what happens next?

**Nick Wadhams** (4:30)
Well, this is one of the big questions that we are all trying to answer. It's still very much unknown. We do have some broad outlines. They sign a deal in Switzerland on the 19th. That then starts the clock ticking on what's meant to be a 60-day window to negotiate these big issues around Iran's nuclear program. But these are the type of negotiations that are extremely technical and would take weeks or months. I mean, when the Obama administration was negotiating its own deal with Iran, that took years to do. So there is that possibility that negotiations could extend well beyond the 60 days. But then that brings up another issue, which is that President Trump is under a lot of pressure from hawks at home who believe that Iran's sole goal here is to essentially drag out these talks for as long as possible. So if things move past that 60-day deadline, he's going to come under a lot of pressure to either walk away from the talks, get a solution or restart the military campaign.