US President Donald Trump said on Thursday that the United States and Iran could sign a peace agreement as early as this weekend, potentially paving the way for the reopening of the strategically vital Strait of Hormuz to international shipping.
However, Iranian officials quickly cautioned that no final decision has been reached, indicating that negotiations remain ongoing despite signs of progress.
If finalised, the agreement would represent the most significant diplomatic breakthrough since the outbreak of the conflict three months ago, a war that has claimed thousands of lives and sent global energy prices soaring.
Speaking to reporters at the White House, Trump said negotiations had reached an advanced stage and suggested that the Strait of Hormuz could reopen shortly after the agreement is signed.
“We just made a great settlement of the war with Iran,” Trump said, adding that a formal signing could take place in Europe as early as this weekend.
He also indicated that Vice President JD Vance could sign the agreement on behalf of the United States.
When asked whether Iran’s supreme leadership had approved the proposed deal, Trump replied that he understood the answer to be yes.
Despite the optimistic remarks from Washington, Iranian Foreign Ministry spokesman Esmaeil Baghaei said negotiations were still under review by the country’s decision-making bodies.
“Large portions of the agreement have been finalised, but Iran will not compromise on its red lines,” he said, stressing that no final conclusion had yet been reached.
Trump’s announcement came shortly after he reportedly cancelled planned military strikes against Iran, citing progress in diplomatic discussions. Financial markets reacted positively, with US stocks rising while oil prices declined amid hopes of de-escalation.
The proposed agreement is expected to address key issues including Iran’s nuclear programme, sanctions relief, access to frozen financial assets and future security arrangements in the region.
Trump reiterated that any settlement must guarantee that Iran cannot develop or acquire nuclear weapons, a position Tehran has repeatedly rejected as unnecessary, insisting its nuclear programme is for peaceful purposes.
Iran, meanwhile, is seeking the removal of international sanctions, access to billions of dollars in frozen assets and recognition of its strategic interests in the Strait of Hormuz.
The conflict, which began following US and Israeli airstrikes on Iran in February, has evolved into one of the most significant geopolitical crises in recent years, disrupting global energy markets and raising fears of a wider regional war.
Although a fragile ceasefire has been in place since April, both sides have continued to exchange military strikes in recent weeks. Iran has launched missile and drone attacks on US facilities in the region, while Washington has conducted operations targeting strategic locations around the Strait of Hormuz.
The political stakes are also high domestically for Trump, as rising fuel prices and concerns over prolonged military involvement have weighed on public opinion ahead of upcoming elections.
Meanwhile, Israeli Prime Minister Benjamin Netanyahu said Israel is not a party to the proposed memorandum of understanding but supports efforts to ensure Iran’s nuclear capabilities are permanently restricted.
The coming days are expected to be crucial as negotiators work to finalise the agreement, which could reshape the security and economic landscape of the Middle East if successfully concluded.
