Iran has issued a pointed warning to the United States, demanding that Washington honor its commitments and avoid interpretations that contradict the explicit terms of the war-end Memorandum of Understanding (MOU). Tehran further stated that contradictory US statements on a possible war-ending agreement are deepening Iranian mistrust of Washington, adding a fresh layer of tension to an already fragile diplomatic process. The warning marks a significant escalation in the war of words between the two sides, coming amid sharply conflicting accounts over the finality and substance of the negotiations.

Iran had previously stated that it has not reached a final decision on a proposed peace agreement with the US, directly contradicting President Donald Trump's claim that the deal had received backing from the country's highest leadership. Trump had announced that planned strikes against Iran were canceled following negotiations and characterized the framework as a "very strong MOU," asserting that Supreme Leader Ayatollah Ali Khamenei had approved it. Iranian Foreign Ministry spokesperson Esmaeil Baghaei, however, stated that while large portions of the agreement had been finalized, Tehran had not concluded its review, saying: "We have not reached a final conclusion on this matter."

US Administration Pushes Back on Leaked Terms

Trump directly accused Iran of leaking false deal terms to the media, stating: "The terms that Iran leaked out to the fake news have nothing to do with the terms that were agreed to, in writing. What they said, including their weak and pathetic statement on having a deal, bears no relation to the truth. Very dishonorable people to deal with." Adding to the pushback from Washington, US Vice President JD Vance took to X to counter what he described as widespread misinformation surrounding the potential agreement. Vance stated: "I'm seeing a lot of fake information about a potential deal to reopen the Strait and end Iran's nuclear weapons program. First, the Iranians are not receiving any cash, and no funds are being released for simply signing a deal or attending a meeting."

Deal Status and Key Developments

The core objective of the agreement remains ensuring that Iran will not obtain a nuclear weapon. Iran's latest warning that the US must honor the explicit terms of the MOU and refrain from contradictory interpretations has further complicated the diplomatic picture. The following table outlines the current state of the diplomatic process based on available statements:

Market Impact and Economic Consequences

The uncertainty surrounding the deal has had tangible effects on global financial markets. Oil prices surged previously on fears that fighting could disrupt shipments through the Strait of Hormuz, while global stocks swung sharply on escalation and ceasefire headlines. Since the conflict reignited in late February, the S&P 500 has fallen 7%, while Brent crude surged more than 20% as traders priced in the risk of disruptions to Middle Eastern energy supplies. Elevated energy prices contributed to a rise in US headline inflation to 4.20% in May from 3.80% in April. Hopes for a deal helped reverse some losses recently, with the S&P 500 rising 1.75% and Brent crude prices falling to around $89 per barrel.

Strategic Importance of the Strait of Hormuz

At the center of the conflict is the Strait of Hormuz, one of the world's most important energy chokepoints. Roughly one-fifth of global energy shipments normally pass through the narrow waterway, making any disruption a major concern for oil traders and policymakers. Iran's latest demand that Washington adhere strictly to the MOU's explicit terms, combined with its warning that contradictory US statements are eroding trust, has added a new layer of uncertainty to the negotiations. Trump has indicated that additional military action could follow if Tehran fails to reach an agreement, leaving the prospects for a resolution increasingly in doubt.

Treasury Secretary Scott Bessent credited a four-stage pressure campaign with bringing Iran to the negotiating table, citing maximum pressure, “epic fury,” “economic fury,” and finally a naval blockade. Speaking on CNBC on Wednesday, Bessent said the administration had not pursued regime change but had “changed the regime,” and that Tehran was willing to discuss its nuclear program for the first time since 1979. He told the Economic Club of New York the night before that Washington was offering Iran carrots, with sticks held in reserve.

President Donald Trump stated in a social media post that Iran had assured Washington there were “no tolls, no insurance costs, and no other charges of any kind” being sought on ships transiting the Strait of Hormuz. Trump warned that if the information proved false, negotiations would end immediately. The ultimatum arrives as Iran and Oman reportedly began discussions on a joint framework for managing Hormuz transit, including possible fee structures.

Bettors on Polymarket on Wednesday assigned roughly a 44% probability that traffic through the Strait of Hormuz would return to pre-disruption norms by July 31. The market for normalization by December 31 stands at 86%. The odds of the Iranian regime falling this year are at 10%, down from a high of over 50% during the war.

Prediction Market Probabilities

Incentives and Oil Market Impact

Iran’s potential incentives include a 60-day U.S. waiver allowing it to sell crude on international markets, the lifting of Washington’s naval blockade, and the conditional release of frozen assets. Brent has fallen below $75 a barrel for the first time since the conflict began, with the IEA estimating the UAE is now exporting at nearly 85% of pre-war levels.

Bessent added that Iranian oil sales would be invoiced in dollars under the framework, meaning every transaction runs through a payment system Washington can monitor and, if needed, shut down. Bessent framed it as part of a broader push to reinforce dollar dominance, citing Venezuela as another sanctioned producer returning to the dollar system. Vandana Hari, founder of Vanda Insights, said last week that crude’s slide was “entirely sentiment-driven” and that the market was front-running a best-case reopening of the strait.