US President Donald Trump gives a speech in the Oval Office of the White House in Washington, DC, USA on June 11, 2026.
Daniel Heuer | Reuters
Pakistan Prime Minister Shehbaz Sharif said Sunday that the United States and Iran have agreed to a deal to end the nearly four-month war, with both sides declaring an immediate and permanent halt to military operations on all fronts, including in Lebanon.
“I am pleased to announce that, after intensive consultations, a peace agreement has been reached between the United States and the Islamic Republic of Iran,” Sharif said in a post on X, noting that Pakistan has been acting as a mediator between the two countries.
“The formal signing ceremony will take place in Switzerland on Friday, June 19th,” Sharif said.
US President Donald Trump confirmed an agreement had been reached shortly after the prime minister’s announcement. “The agreement with the Islamic Republic of Iran is complete,” the president said in a post on Truth Social.
“I hereby fully authorize the free opening of the Strait of Hormuz, and at the same time authorize the immediate lifting of the U.S. naval blockade,” Trump wrote.
In a subsequent post, President Trump said the strait would open to traffic on Friday.
“With the opening of the strait following the signing of Friday’s agreement, oil will once again be flowing from both ends for the purpose of demining, for the benefit of the region and the world!” he said.
Iran’s Supreme Council for National Security confirmed on Sunday that it had finalized a memorandum of understanding under which Iran would “immediately and permanently” cease military operations on all fronts, including Lebanon.
A Persian-language statement translated by MS NOW said the naval blockade against Iran would also be lifted immediately, but negotiations on a final agreement would be postponed until Washington first implements its commitments under the memorandum of understanding.
According to the Associated Press, Iranian state media broadcast a television banner declaring that the United States was “forced to sign an agreement to end the war.”
Iranian state television also said Iran’s Foreign Ministry said the United States and Israel were “responsible for the dangerous consequences of continued security instability and tension in the region.”
Qatar’s Ministry of Foreign Affairs said in a statement that it welcomed the agreement, which includes measures to ensure freedom of navigation in the Strait of Hormuz. Qatar said it “considers this an important step towards strengthening sustainable peace and promoting economic growth regionally and internationally.”
European countries including the UK, Germany, France and Italy said on Sunday they were willing to lift sanctions on Iran in exchange for the country tackling its nuclear program, Reuters reported.
“Iran must never acquire nuclear weapons. We stand ready to work with the United States, Iran, and the IAEA to end this problem,” the country’s leaders reportedly said in a joint statement.
On Friday, Iranian state media reported that a 14-page memorandum of understanding had been drafted outlining the terms of a proposed peace deal, including that the United States lift oil sanctions and Iran commit to reopening the Strait of Hormuz within 30 days.
The agreement follows weeks of mixed messages from both Washington and Tehran over the course of the conflict, as a fragile ceasefire remains in place amid diplomatic efforts to end the war.
The agreement was put in jeopardy early Sunday when the Israel Defense Forces announced that Iran-backed Lebanese Hezbollah had launched a projectile into Israel. A subsequent Israeli airstrike in Beirut drew condemnation from President Trump, who warned Iran and Hezbollah not to fight back.
President Trump urged both sides not to “explode.”
The Strait of Hormuz, a key shipping lane in the Middle East, has been effectively closed since the conflict began in late February. The blockage of waterways has severely constrained the supply of a range of goods, including oil, gas and fertilizer, causing price hikes and raising fears of a return to stagflation.
Inflation rates have already begun to rise in many major countries, with annual inflation in the United States reaching 4.2% in May, the highest level in three years.
Vice President J.D. Vance said in an interview on Fox News shortly after the deal was signed that the deal was “a great thing for the American people.”
“We know they’re struggling with high gas prices, and the president is certainly very concerned about that fact,” Vance said. “What we can do is lower energy costs not just now but in the long term.”
The European Central Bank on Thursday announced a quarter-point rate hike, the first rate hike since 2023, as euro zone inflation continues to fall below target due to the Iran war.
The move made the ECB the first major global central bank to raise key interest rates in response to an energy shock.
Market expectations changed through the war, and expectations for widespread interest rate cuts waned, replaced by a prolonged high interest rate environment across economies.
The Fed is expected to raise rates by the end of this year, according to CME’s FedWatch tool.
