The United States and Iran are moving closer to a preliminary agreement aimed at ending the war in the Gulf, Axios reported quoting two sources familiar with the mediation effort. The news website reported that one source is linked to Pakistan, which has hosted talks between the two sides. Another source has direct knowledge of the negotiations, it said.
The proposed deal takes the form of a one-page, 14-point memorandum. It sets out terms to formally end the conflict and open the door for further negotiations. The draft includes steps to restore shipping through the Strait of Hormuz, ease US sanctions on Iran, and place limits on Iran’s nuclear programme.
The memorandum includes a commitment from Iran to pause uranium enrichment. It also proposes that the United States lift sanctions and release billions of dollars in frozen Iranian funds. Both sides would remove restrictions on shipping through the Strait of Hormuz. The pause on uranium enrichment could last between 12 and 15 years. The draft also sets a 30-day window for detailed negotiations after the agreement is signed.
“We will close this very soon. We are getting close,” said a source involved in the mediation through Pakistan.
What does the proposed deal include?
The framework focuses on immediate de-escalation. It calls for an end to hostilities and a pause in key nuclear activities. It also aims to restore maritime traffic in one of the world’s most important energy routes, reported Axios.
If both sides accept the draft, negotiations will shift to a more detailed agreement. That phase would address sanctions relief, nuclear restrictions, and access to frozen funds. The talks are being led on the US side by envoy Steve Witkoff and Jared Kushner, according to a source familiar with the process.
However, several long-standing US demands are not part of the current draft. These include limits on Iran’s missile programme and an end to its support for regional militias. The draft also does not address Iran’s existing stockpile of enriched uranium, which Washington has previously asked Tehran to give up.
A spokesperson from Iran’s foreign ministry told CNBC that Tehran is reviewing a US proposal with 14 points.
Why are markets reacting strongly?
Reports of progress in talks triggered fluctuations in global markets. Oil prices fell as traders expected a possible end to supply disruptions. Brent crude dropped more than 8% to around $100 a barrel. Stock markets rose, while bond yields declined as investors reacted to the possibility of reduced geopolitical risk.
The developments came shortly after US President Donald Trump paused a naval mission aimed at reopening the Strait of Hormuz. The operation, called Project Freedom, began just days earlier. It sought to escort ships through the blocked waterway but failed to restore normal traffic, reported Reuters.
In a post on social media, Trump said, “We have mutually agreed that, while the Blockade will remain in full force and effect, Project Freedom will be paused for a short period of time to see whether or not the Agreement can be finalized and signed.”
Iran signalled it could allow shipping under new conditions. Officials did not provide details. The White House and the US State Department did not respond to requests for comment. Iranian officials also did not issue an immediate response to Reuters.
Earlier attacks in the Strait of Hormuz have raised tensions. A French shipping company reported that one of its vessels was hit, and crew members were injured and evacuated. Other incidents included strikes on cargo ships and targets in nearby countries.
Iran has restricted access to the strait since the war began on February 28. The United States later imposed its own blockade on Iranian ports.
Iran’s Foreign Minister Abbas Araqchi said during a visit to China that Tehran is seeking “a fair and comprehensive agreement.” He did not comment directly on Trump’s latest statement.
The next 48 hours could prove critical. The United States is waiting for Iran’s response on key points. If both sides agree, the draft memorandum could mark the first step toward ending a conflict that has disrupted global energy flows and raised tensions across the region.