President Trump announced a temporary ceasefire with Iran on Tuesday, pending the complete reopening of the Strait of Hormuz. The agreement, facilitated by Pakistan, aims to de-escalate the ongoing conflict between the two nations.

Ceasefire Details and Conditions

The ceasefire is set to last for two weeks, beginning immediately. President Trump stated on Truth Social that he believes the U.S. has already achieved its military objectives. However, the agreement is explicitly contingent upon Iran’s full, immediate, and secure reopening of the Strait of Hormuz, a critical waterway for global oil shipments.

Iranian Response and Confirmation

Iranian Foreign Minister Seyed Abbas Araghchi confirmed Iran’s acceptance of the ceasefire. Iran has agreed to halt defensive operations, likely referring to recent missile and drone strikes against U.S. allies in the region, in exchange for a cessation of U.S. attacks. Iranian armed forces will also work to ensure safe passage through the Strait of Hormuz.

International Reactions

Israel has endorsed the ceasefire proposal, according to a White House official. However, Israel clarified that the ceasefire with Iran does not extend to the ongoing conflict between the Israeli military and Hezbollah in Lebanon.

Economic Impact

The announcement of the ceasefire led to a significant drop in oil futures. The U.S. benchmark, West Texas Intermediate, fell by over 13% to below $92 a barrel. Oil prices had previously surged due to disruptions in shipments through the Strait of Hormuz, which handles approximately a fifth of the world’s oil supply.

Negotiations and Remaining Disagreements

Negotiations between the U.S. and Iran are scheduled to commence in Islamabad, Pakistan, on Friday and will span two weeks. Iran has expressed complete distrust towards the American side. Despite the ceasefire, substantial disagreements remain.

Key Iranian Demands

Iran’s 10-point plan reportedly demands the withdrawal of U.S. forces from regional bases, full compensation to Iran, the lifting of all sanctions, and control over the Strait of Hormuz. It also calls for an end to hostilities against groups like Hamas, Hezbollah, and the Houthis. President Trump has indicated opposition to Iran controlling the Strait of Hormuz and collecting tolls.

The status of Iran’s nuclear program also remains a point of contention. President Trump has publicly called for Iran to abandon all uranium enrichment, while Iran maintains its program is peaceful.