“Let the oil flow!” With those words on Sunday evening, US President Donald Trump announced that the United States had reached an agreement to end the war with Iran after more than one hundred days and open the Strait of Hormuz, with the official signing set to occur on June 19. Shortly after, Iranian officials confirmed that the two sides had finalized a memorandum of understanding (MOU) that would remove the US naval blockade of Iranian ports and extend the current ceasefire.

As details emerge, our experts are sharing their insights on what we know—and still don’t know—about the deal, what it all means, and what to expect next. We’ll update this post as we learn more and additional expert contributions roll in.

Click to jump to an expert analysis:

Nate Swanson: Watch for a “delta” between the MOU’s aspirations and a final deal

Landon Derentz: Don’t be so sure about a fast return to normal for energy markets

Josh Lipsky: These are the big questions markets—and US allies—will now want answered

Victoria J. Taylor: The war’s tactical achievements have not amounted to strategic success

Watch for a “delta” between the MOU’s aspirations and a final deal

We do not know the full details of what is in the MOU between Iran and the United States. To date, there has been more spin than substance, but there are three items to watch for: 1) what the MOU does, 2) what it aspires to do, and 3) what it needs to do to avoid more conflict.

Based on public reporting, the MOU is a fourteen-point plan that codifies the tenuous ceasefires in Iran and Lebanon and outlines areas for future negotiations. It will most likely temporarily reduce violence, increase maritime traffic, and provide parties with more time to hammer out details. It does not appear to resolve the core issues surrounding the mechanics of the Strait of Hormuz, Iranian nuclear concessions, or Iranian financial incentives and sanctions relief. Those issues are supposed to be addressed in a second phase—and plans for addressing those issues are already receiving domestic criticism in the United States, Israel, and Iran for their yet-to-be-confirmed contents.

There are structural incentives in the United States, Iran, and Israel that will make a second phase difficult to achieve. To date, the United States hasn’t shown the patience necessary to complete a complicated nuclear deal that requires new monitoring and verification measures. Creative solutions are also needed for an overlapping sanctions regime that was designed in the first Trump administration to prevent a return to a nuclear deal.

Likewise, Iranian Supreme Leader Mojtaba Khamenei may not want to do anything beyond a small, transactional deal with the United States, given Trump’s withdrawal from the Obama administration’s deal in 2018 and the fact that the United States and Israel killed Khamenei’s father, mother, wife, and son. It’s possible Iran agrees to terms that are wildly in Iran’s favor, but those are likely to be so unpalatable in the United States and Israel that a deal is extremely unlikely. Meanwhile, Israel appears opposed to any deal and will use its influence to block or undermine one—especially if the terms are bad.

An MOU, without any follow-on deal, will be volatile and impossible to sustain on its own. There must be a further understanding regarding the Strait of Hormuz to ensure the resumption of maritime commerce—or else the United States could easily slip back into war with Iran. As details about the parameters for future negotiation emerge, be cautious. There will likely be a significant delta between the aspirations outlined in the MOU and what emerges in a final deal.

—Nate Swanson is a resident senior fellow and director of the Iran Strategy Project at the Scowcroft Middle East Security Initiative. Beginning in 2015, he served as a senior advisor on Iran policy to successive administrations, including most recently as director for Iran at the US National Security Council.

Don’t be so sure about a fast return to normal for energy markets

The reported reopening of the Strait of Hormuz following a fragile understanding between Washington and Tehran is undoubtedly welcome news for global energy markets. Yet the assumption that oil markets will quickly revert to pre-conflict conditions deserves scrutiny.

Much remains uncertain, not least the future of Iran’s nuclear program and the durability of the broader agreement itself. If the strait genuinely reopens—and, critically, if maritime traffic can move without the threat of missiles, drones, or mines—it would be unwise to bet against the ingenuity and determination of the energy sector. Oil-storage facilities throughout the Gulf remain well-stocked, ready to offer immediate relief to markets, while thousands of engineers and technicians are already working to restore production and export infrastructure to prewar levels.

The challenge is that energy markets run on certainty. A stop-and-start ceasefire that repeatedly disrupts shipping routes, delays mine-clearing operations, or enables periodic attacks on critical infrastructure will slow the return of supply and keep risk premiums elevated. Gulf producers remain committed to their role as reliable suppliers, but stability cannot be manufactured overnight, and globally, inventories are at multiyear lows.

Markets have responded positively, with oil prices falling on the news. Even so, prices remain substantially above where they began the year. A geopolitical premium is likely to persist given the deep mistrust among all parties and the significant drawdown of commercial and strategic inventories used to offset recent supply losses. Returning to prewar pricing will require not only the restoration of disrupted supply but renewed expectations of oversupply—something the OPEC group of oil-producing countries may seek to engineer, though likely not before later this year.

Another challenge is that the war caused structural damage. Portions of the region’s downstream infrastructure and liquefied natural gas export capacity, including facilities at Ras Laffan, will require extensive repairs. Even under the most optimistic scenario, a return to business as usual will take time.

—Landon Derentz is vice president for energy and infrastructure at the Atlantic Council, and senior director and Morningstar chair for global energy security at its Global Energy Center. He served as director for energy at the White House during the first Trump administration.

These are the big questions markets—and US allies—will now want answered

Don’t expect markets to celebrate a deal-signing for too long. The news, announced just as Asian markets opened, sent futures higher and oil prices lower—for the moment. Over the past month, as news of each potential deal has rocketed around Bloomberg terminals, energy traders have priced in the likelihood that sooner or later a deal will actually materialize. That means markets, which are by design forward-looking, have already been pricing in today’s outcome.

If you had been wondering why oil is trading at under $90 a barrel instead of $120+ given the prolonged closure of the Strait of Hormuz, it’s precisely because this outcome has been well-telegraphed. Markets want answers to two key questions going forward to turn the rally into momentum: 1) Does the strait actually open as promised? and 2) How much will transiting the strait now cost relative to before the war? The risks of mines, drones, and another flare-up all have to get rolled into those calculations. Until there’s more hard evidence regarding both questions, markets will only see the signing of the peace deal as one more data point.

These aren’t just market questions; these are the questions Group of Seven (G7) leaders will ask Trump when he arrives in Evian, France on Monday for this year’s G7 summit. The bloc’s economies have been hit with higher inflation thanks to the war—with the European Central Bank raising interest rates last week for the first time in three years. The global economy has experienced too much whipsawing in the past 100+days of war to breathe easy based on a deal with no details, and the first test of those details will come as Trump is pressed by French President Emmanuel Macron and others gathered for the summit. Trump likely wanted to come to the meeting with a deal in place. Now he has set the terms for the leaders meeting—and they will be reacting to him.

—Josh Lipsky is vice president and chair of international economics at the Atlantic Council and the senior director of the GeoEconomics Center. He previously served as an advisor at the International Monetary Fund.

The war’s tactical achievements have not amounted to strategic success

The Iran deal is likely the best possible outcome, but it is perhaps no better than what could have been achieved had the United States pursued diplomacy rather than war in the first place.

The Trump administration can rightfully claim that it decimated key elements of Iran’s military power. But despite these tactical successes and the elimination of key Iranian leaders, the war was a strategic failure. The regime remains in place, and it is emboldened after its retaliation throughout the Gulf. Rather than convince Iran to abandon its nuclear program, the war may have persuaded the Iranian leadership that a nuclear deterrent is the best way to safeguard its future.

Since the United States launched this war, its strategic objectives have changed. It has ultimately failed to bring regime change and instead strengthened the hand of the hardliners.

While the deal will reportedly reopen the Strait of Hormuz, Iran has demonstrated that its longstanding threats to close the strait are not just bluster and it can wreak havoc on the global economy. The ability to close the strait is a potent weapon that Iran will threaten to wield in the future.

There is a possibility that this ceasefire could pave the way for a more permanent deal, but it is more likely this will be a temporary and fragile understanding that will, in the best-case scenario, prevent renewed war through the end of this administration.

—Victoria J. Taylor is director of the Atlantic Council’s Iraq Initiative. She served most recently as deputy assistant secretary of state for Iraq and Iran during the Biden and Trump administrations.