New Draft Memorandum Hints Reopening Strait of Hormuz

The United States and Iran could be getting closer to a temporary peace deal after new details of a new draft memorandum came to light over the weekend. The proposed US-Iran deal aims to to calm down tensions in the gulf amid the ongoing ceasefire. It eyes resume commercial shipping via reopening of the Strait of Hormuz and a new nuclear talks process between the two nations.

Details On The New US-Iran Draft Memorandum

The draft memorandum presents a plan for Iran to allow commercial shipping in the Strait of Hormuz. On America’s side, it would relax its naval surveillance near Iranian ports, per Reuters report. The deal also would set up a 60-day negotiating window for a more comprehensive agreement on Tehran’s nuclear program and sanctions relief.

The Strait of Hormuz continues to be one of the world’s vital energy corridors. Typically, about one-fifth of the world’s oil traffic travels through the route.

The region has been plagued by tensions in recent months, which had already affected shipping activity and raised concerns in global financial and energy markets. Now, with with the US-Iran deal, if it’s reopened, fuel and energy markets could see a relief, according to experts.

Recently, U.S. President Donald Trump also signaled signing a final deal by Sunday itself. He even said that the Strait of Hormuz would be reopened “immediately” after both parties sign the agreement.

The US-Iran memo is said to contain provisions on economics, among other things. The United States wouldn’t impose new sanctions on Iran in the negotiation process.

Washington could also temporarily lift sanctions on Tehran to permit the resumption of oil sales to the West. In addition, it has been reported that frozen Iranian assets equivalent to approximately $25 billion could be transferred in the future. For this purpose they could use direct transfers, regional financial cooperation, and credit transfers.

MoU Offers Resolution On Nuclear Power Issues

On the nuclear front, Iran would pledge to refrain from developing a nuclear arm. It would maintain the same level of nuclear activity as long as an overall deal is accomplished. The US-Iran memorandum also sets out plans for future talks on Iran’s stockpiles of highly enriched uranium.

Both sides’ officials showed some progress, but negotiators suggested that technical and political discussions continue. Iranian officials have also warned of possible changes to the draft before it can be formally signed.

The news on US-Iran negotiations had a positive impact on Bitcoin and the overall crypto market. At the time of writing, the BTC price traded at $64,557, up by approximately 1.28% in the last 24 hours. Other cryptocurrencies like ETH, XRP, and BNB coin also gained slightly amid signs of a decrease in geopolitical tensions.