President Donald Trump emerged from a two-hour Situation Room meeting on Friday without a final decision on a proposed 60-day ceasefire extension with Iran, leaving global oil markets to weigh the gap between diplomatic progress and unresolved terms.
Trump wrote on Truth Social that the US naval blockade of Iranian ports "will now be lifted" and that he would convene a meeting "to make a final determination" on the memorandum of understanding negotiated by US and Iranian teams. The draft agreement would extend the fragile ceasefire that began in early April, reopen the Strait of Hormuz to unrestricted shipping, and set the stage for negotiations on Iran's nuclear program.
"The administration is close to a deal, but certain matters — including the unfreezing of Iranian funds — remain under discussion," a senior US official told the New York Times, speaking on condition of anonymity.
Iran's semi-official Fars news agency, citing informed sources, dismissed Trump's characterization of the terms as a "mixture of truth and falsehood" intended "to portray a fabricated victory." The agency said no final decision had been made in Tehran and that there was no provision in the draft requiring Iran to reopen the Strait without charging fees or to destroy its enriched uranium stockpiles.
Oil markets have already priced in a significant de-escalation premium. Brent crude futures fell 1.1% to $92.67 a barrel Friday, bringing the weekly decline to 10.5% — the steepest since early April. West Texas Intermediate dropped 1.4% to $87.64, down 9.2% for the week. The moves reflect growing expectations that the Strait of Hormuz, which handles about a fifth of the world's traded oil and natural gas, could soon resume normal operations after months of disruption.
The economic toll of the conflict is mounting. US households have spent roughly an extra $450 on energy since the war began in late February, according to Moody's Analytics. The Pentagon has priced the three-month campaign at about $29 billion, though analysts say the true cost could exceed $1 trillion once indirect expenses are tallied.
The Terms Under Dispute
The proposed MOU would see Iran remove all mines from the Strait of Hormuz within 30 days and commit to not pursuing a nuclear weapon, according to US officials. In return, Washington would gradually lift its naval blockade on Iranian ports and relax sanctions, allowing Iran to sell more of its oil. The draft also includes an immediate payment of $12 billion from Iran's frozen assets, per Fars news agency, and a $300 billion reconstruction and investment fund for Iran, the New York Times reported.
But key sticking points remain. Iran's foreign ministry spokesperson Esmail Baghaei said Tehran is "focused on ending the war" and not on negotiating its nuclear program. Iran holds 440.9 kilograms of uranium enriched to 60% purity — a short technical step from weapons-grade levels of 90%, according to the International Atomic Energy Agency. Kazakhstan has signaled willingness to store the stockpile, IAEA chief Rafael Grossi told the Financial Times.
Vice President JD Vance told reporters Thursday that Washington was "not there yet" but "very close," adding that the US was in a position to "substantially set back Tehran's nuclear program." He cited "a couple of issues on the nuclear stuff, the highly enriched stockpile, and also the question of enrichment."
Broader Regional Fallout
The uncertainty extends beyond US-Iran negotiations. Israeli Prime Minister Benjamin Netanyahu said Friday that Israeli forces had crossed Lebanon's Litani River and advanced, while ordering the military to seize 70% of the Gaza Strip. UNICEF reported that an average of 11 children have been killed or injured every 24 hours in Lebanon over the past week.
Trump this week threatened to "blow up" Oman — a longstanding US ally — over discussions about shared control of the Strait of Hormuz. Treasury Secretary Scott Bessent said Friday that Oman's ambassador had confirmed "no plans for tolling the strait."
Chevron CEO Mike Wirth told Bloomberg TV the company will not pay transit tolls for its vessels in the strait, noting "multiple incidents" of attacks on ships. Chevron has six vessels operating under charter in the waterway.
The unresolved status of the deal keeps energy markets in a holding pattern. If approved, the agreement could unlock Iranian oil supply and drive crude prices lower. If talks collapse, the risk of renewed hostilities — and a full closure of the Strait of Hormuz — would push prices sharply higher, with direct consequences for global inflation and central bank policy.
This article is for informational purposes only and does not constitute investment advice.