The June 17 Memorandum of Understanding between the United States and Iran expired on Monday as talks stalled and the two sides remained divided over the terms of a ceasefire. Full-scale fighting has paused for the time being, but the war that began on February 28 remains unresolved.
Brokered and hosted by Pakistan, the 14-point memorandum was intended to begin 60 days of negotiations toward a wider peace deal. It also set out plans to reopen the Strait of Hormuz, but disputes over shipping routes and control of the waterway helped trigger renewed attacks.
What the memorandum promised
The agreement was signed by Iranian President Masoud Pezeshkian and US President Donald Trump. It called for the immediate and permanent end of military operations on all fronts, including Lebanon, and said a final deal would confirm a permanent end to the war.
The United States agreed to end its naval blockade within 30 days, withdraw forces from near Iran after a final deal, develop a reconstruction and economic-development package of at least $300bn with regional partners, lift sanctions, issue waivers for Iranian oil exports and allow access to frozen overseas funds.
Related coverage: Trump says US will claim Strait of Hormuz after Iran war.
Iran pledged to clear mines in the Strait of Hormuz and allow ships to pass without charge for 60 days. It also reaffirmed that it would not seek nuclear weapons and agreed to negotiate issues including uranium enrichment. Further details were to be included in a final deal backed by the United Nations.
Why the ceasefire terms became disputed
The source report identifies vague wording as the central problem. Former acting director of the US State Department’s Office of Iranian Affairs Joey Hood said the memorandum was poorly written and left room for Iran to interpret it as granting sovereignty over the Strait of Hormuz and a role in Lebanon’s future.
Article 5 promised safe passage for commercial vessels and required Iran to make arrangements for traffic between the Persian Gulf and the Sea of Oman. It also referred to demining, discussions with Oman and other Gulf states, international law and the sovereign rights of coastal states. The parties disagreed over which route ships should use: Oman backed a route close to its coast, while Iran had issued a map directing vessels closer to Iran and designating the Omani side as restricted.
More context: Iran weighs return to US talks as Hormuz conditions remain unresolved.
The memorandum’s Lebanon provision also created a dispute because it did not mention Israel. Iran argued that Israeli attacks in Lebanon should end under the ceasefire, while Israel rejected that interpretation. Article 6 further referred to at least $300bn for Iran’s reconstruction without specifying who would pay, how the money could be spent or how the plan would work. The sanctions language likewise did not clarify whether it covered only US sanctions or also UN-mandated sanctions.
How the agreement broke down
On June 25, the Singapore-flagged commercial vessel Ever Lovely was struck by a projectile while using a route near Oman’s coast. Iran did not claim responsibility and did not deny the attack. Washington blamed Iran, and Trump called it a violation of the ceasefire.
On June 27, US Central Command said US aircraft had struck missile and drone storage sites and radar locations along Iran’s southern coast in response to the ship attack. Iran’s Foreign Ministry said the strikes violated Article 1, which required an end to hostilities. Mohsen Rezaei, an adviser to Iran’s Supreme Leader Mojtaba Khamenei, also accused the United States of violating Article 5.
Also read: Iran links Strait of Hormuz reopening to US concessions.
Iran said it then attacked US military installations in the region and warned that a future response to aggression would be broader. The United States and Iran therefore began exchanging strikes 10 days after signing the memorandum. On July 7, Trump declared the agreement “over” as US attacks continued. Iran later said the United States had violated and suspended its commitments, and that Tehran had suspended its own commitments in response.
What happens after the expiry
The 60-day deadline no longer has practical relevance, according to Iranian Foreign Ministry spokesperson Esmaeil Baghaei, who said the United States had violated the memorandum weeks after it was signed and that talks were never initiated. Negotiations have reached a deadlock, while the ceasefire’s provisions have not prevented renewed hostilities.
Iran has said it is not holding direct talks with the United States because of the alleged violations. Tehran has instead discussed the future management of the Strait of Hormuz with Oman, while Pakistan has tried to restart direct US-Iran negotiations. The memorandum may still provide a basis for future talks, but the source report found no sign that it will be revived or replaced soon.
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