US-Iran Memorandum of Understanding expires: How and why it fell apart 

The June 17 Memorandum of Understanding (MoU) between the United States and Iran expired on Monday amid faltering talks between the two sides. While full-scale fighting has been paused for the time being, the war on Iran, which began on February 28, is far from resolved.

The Islamabad-brokered MoU was supposed to kick-start a 60-day period for peace talks between the two sides and included provisions for the reopening of the Strait of Hormuz, which has become a major flashpoint in the war.

However, the vague wording of many of the clauses caused major disagreements – in particular over who had ultimate control over shipping through the strait, with Iran launching strikes on several ships which had failed to follow its approved route.

As a result, the US re-launched strikes on Iran, triggering more attacks by Iran on US military assets in Gulf countries and Jordan as well as on energy and other infrastructure.

Furthermore, while the MoU provided for a ceasefire on all fronts, including in Lebanon and Gaza, Israel has continued strikes on both territories and still occupies around one-fifth of Lebanon, where it says it is targeting strongholds of the Iran-backed Hezbollah.

We look at key moments of the MoU and why it broke down.

What was the MoU between Iran and the US?

The 14-point MoU was signed on June 17 between Iranian President Masoud Pezeshkian and US President Donald Trump. It was a ceasefire agreed after high-level talks hosted and mediated by Pakistan and triggered a 60-day period for negotiations aimed at reaching a wider peace deal.

In the MoU, both sides agreed on the “immediate and permanent termination of military operations on all fronts, including in Lebanon”.

Under it, the US agreed to end its naval blockade within 30 days, remove its forces from near Iran after a “final deal” was reached and begin work on a reconstruction and development package for Iran of at least $300bn.

The US also agreed to lift sanctions on Iran, issue waivers for Iranian oil exports and allow Tehran to access frozen funds overseas.

For its part, Iran pledged to clear mines from the Strait of Hormuz and allow ships to pass “with no charge” for 60 days.

Tehran also reaffirmed it would not seek to build nuclear weapons and would negotiate over issues such as the enrichment of uranium. Further details of how this would work would come in a “final deal” to be backed by the United Nations.

What were the key sticking points that crippled the MoU from the start?

Ultimately, the woolly wording of the MoU was to blame for it breaking down.

Joey Hood, the former acting director of the Office of Iranian Affairs at the US State Department, said the MoU “was doomed to fail” because “it was very poorly written and it gave Iran the chance to interpret the MoU as giving it sovereignty over the Strait of Hormuz and the future of Lebanon”.

Hood said that “if there were professional diplomats involved from the US side, it never would have been written the way that it was. It never would have allowed Iran that wiggle room”.

Three clauses in particular caused disagreements:

Article 5 of the MoU promised “safe passage of commercial vessels” through the Hormuz strait.

It stated: “Upon the signing of this MOU, the Islamic Republic of Iran will make arrangements using its best efforts for the safe passage of commercial vessels with no charge for 60 days only from the Persian Gulf to the Sea of Oman and vice versa. The traffic of commercial vessels will immediately start, and considering the need for removing the technical and military obstacles and demining by the Islamic Republic of Iran will be instated within 30 days. The Islamic Republic of Iran will conduct dialogue with the Sultanate of Oman to define the future administration and maritime services and the Strait of Hormuz in discussion with other Persian Gulf littoral states in line with the applicable international law and the sovereign rights of coastal states of the Strait of Hormuz.”

However, there was immediately a major disagreement about what routes ships should take through the strait. Oman, through whose territorial waters the strait flows besides Iran, issued a US-backed route allowing vessels to pass close to its coast. However, Iran had previously issued a map requiring ships to pass closer to its own coast, and deeming the Oman side of the strait “restricted”.

Several ships which followed the Oman route were targeted as a result at the end of June as the two sides disagreed over who had the power to authorise routes. Then, the US relaunched strikes on Iran which lasted for nearly two weeks.

Article 1 of the MoU also presented difficulties.

It states: “The United States of America and the Islamic Republic of Iran and their allies in the current war, by signing the MOU, declare the immediate and permanent termination of military operations on all fronts, including in Lebanon, and undertake from now on not to initiate any war or any military operation against each other and to refrain from the threat or use of force against each other and ensuring the territorial integrity and sovereignty of Lebanon. The final deal will confirm the permanent termination of the war on all fronts, including in Lebanon and other provisions of this paragraph.”

One of the main issues with this passage is that it made no mention of Israel, which currently occupies Lebanon and has subjected the south of the country to near-daily strikes since early March, killing at least 3,000 people and displacing more than one million from their homes.

While Iran argued that Israeli aggression towards Lebanon must cease under the MoU, Israel disagreed.

Article 6 of the MoU made a vague reference to meeting the cost of rebuilding Iran after the war, but critically gave no details.

It stated: “The United States of America undertakes with regional partners to develop a definitive, mutually agreed plan with at least USD 300 billion for the reconstruction and economic development of the Islamic Republic of Iran. The mechanism for the implementation of this plan will be finalized as part of a final deal within 60 days. All required licenses, waivers, and permissions needed for the relevant financial transactions will be granted by the United States of America.”

There was no indication of who would pay the $300bn or if there would be any restrictions on how it could be spent.

Separately, the MoU, which mentioned the lifting of sanctions on Iran, failed to specify whether these were US sanctions only, or also UN-mandated sanctions.

How did the MoU break down?

The MoU collapsed within a month of being signed, with the US and Iran blaming each other for violating its terms and with renewed hostilities.

On June 25, the Ever Lovely, a Singapore‑flagged commercial vessel, was struck by a projectile while transiting a route close to the coast of Oman. While Iran did not claim this attack, it did not deny it either.

Washington blamed Iran for the attack, with Trump deeming it “a foolish violation” of the ceasefire agreement.

Then, on June 27, US Central Command (CENTCOM) said its aircraft had struck missile and drone storage locations and radar sites along Iran’s southern coastline “as a powerful response to yesterday’s attack on a commercial ship that was transiting the Strait of Hormuz”.

The Iranian Foreign Ministry condemned that US attack, saying the targeting of “coastal surveillance facilities violates Article 1 of the Memorandum of Understanding”, under which both sides had pledged to end hostilities on all fronts.

Mohsen Rezaei, the adviser to Iran’s Supreme Leader Mojtaba Khamenei, additionally accused the US of violating Article 5 of the MoU, which called for the restoration of a safe passage for commercial vessels in the Strait of Hormuz.

Iran retaliated against this attack, saying it hit US military installations in the region on the same day. “In the event of repeated aggression, our response will be more extensive than this,” the IRGC said in a statement at the time.

So, just 10 days after signing, the US and Iran began trading strikes again.

On July 7, Trump declared that the agreement was “over”, as the US continued to attack Iran.

Several days later, Tehran claimed the US had targeted civilian infrastructure in the south of the country, and that at least 50 people had been killed since the renewed attacks began.

Iranian officials said the US had “violated and suspended” all its commitments under the MoU and Tehran had “likewise suspended all our own commitments”.

This month, Iran has stated several times that it is not speaking directly to the US due to its violations of the MoU. Instead, it has held talks with Oman about the future management of the Strait of Hormuz, while Pakistan has been attempting to rekindle direct talks between the US and Iran.

What does the end of the MoU mean for the war?

Ultimately, negotiations have reached a deadlock.

On one hand, the MoU had broken down with hostilities resuming shortly after it was signed. On the other hand, it did form a basis for future negotiations, experts say.

The Iranian Foreign Ministry spokesperson, Esmaeil Baghaei, has stated that there is no longer any relevance to the 60-day deadline following the MoU, saying the US violated the agreement weeks after it was signed.

“Due to the gross and widespread violation of the memorandum by the United States just a few weeks after it was signed, no talks were initiated,” he said.

“As a result, the issue of a 60-day deadline became entirely moot,” Baghaei added.

Hood told Al Jazeera that there is therefore “no sign” of reviving the MoU or reaching a new agreement as “both sides have locked horns”.

He characterised Iran “insisting on having sovereignty over” the Strait of Hormuz as a major obstacle, and predicted that “if Iran were to allow ships to go through again freely”, then Trump would reciprocate “by dropping the naval blockade and the oil sanctions”.