In a major policy shift, the United States and Iran signed a memorandum of understanding on June 17. The agreement, signed remotely by Presidents Donald Trump and Masoud Pezeshkian, proposes up to $300 billion in reconstruction funding for Iran and immediate relief on fossil fuel export sanctions.
In return, Iran has pledged to halt nuclear weapons development and begin down-blending its enriched uranium stockpiles under International Atomic Energy Agency supervision. The deal also establishes a ceasefire and the resumption of commercial shipping through the critical Strait of Hormuz.
The MOU is an interim agreement. The two sides have 60 days to finalize specifics, including the funding sources for the reconstruction package. The agreement does not address Iran's ballistic missile program or its network of regional proxy groups, which has drawn criticism from U.S. lawmakers.
Markets reacted to the reduced geopolitical tension. The Strait of Hormuz handles about 20% of the world's daily oil consumption, and its stabilization removes a major risk factor for global energy markets.
Investors should monitor the next 60 days as a critical window for implementation.