The United States and Iran have reached a preliminary agreement regarding ending their conflict in the Middle East. However, diplomats note that the road ahead remains long, as several more days will be needed before the agreement can be finalized by both sides. After that period, a “60-day phase” will begin, during which the peace agreement will be tested on a provisional basis. Markets, though cautiously, are reacting positively, with Brent crude falling below the “psychological threshold” of $100 per barrel and the S&P 500 posting slight gains.

The deal between the two sides includes reopening the Strait of Hormuz, as well as a public commitment by Iran not to develop nuclear weapons and to hand over its enriched uranium while shutting down its enrichment facilities. However, in none of these three areas has it yet been decided exactly how these steps will be carried out. This appears to be the point where talks have stalled: on Saturday, U.S. President Donald Trump said that “an agreement will soon be announced,” but yesterday he stated that “we are not in a hurry.”

As political tensions have erupted inside the United States over whether the agreement represents a concession — with some Democrats calling it a “surrender” — President Trump is being very careful about how the agreement is presented publicly. “Don’t listen to the losers, the deal I make will be better than Obama’s,” he wrote yesterday.

The Three “Sticking Points”

The path toward finalizing the agreement appears longer because, while both sides seem to agree on the core issues, negotiations are slowing over difficult details. What are they?

1. Control of the Strait of Hormuz

Regarding the reopening of the Strait of Hormuz, there is a major disagreement that has become public. Although both sides agree that the peace deal should reopen the strategically vital shipping route — especially for global oil transport and trade — they have not agreed on how or by whom this will be managed.

Iran considers it self-evident and a “legitimate right,” according to leaks attributed to Iranian Foreign Minister Abbas Araghchi, that Tehran should retain full control of the strait.

This would not necessarily be a problem for the United States if the leaked terms of the agreement were not being interpreted in Washington as an American “surrender” to Iran. Trump insists that his deal “will not be like Obama’s” and will not involve giving money or resources to Iran, suggesting that serious disagreement remains on this issue.

At the same time, Iranian sources in local media — specifically a military official who advises Iran’s Supreme Leader Mojtaba Khamenei — insist that the country “has the legitimate right to manage the strait.” Tehran appears unwilling to back down because this is not merely a matter of pride, but survival: Iran needs control of the strait to generate desperately needed revenue.

The question remains: who will yield?

2. Enriched Uranium and Nuclear Facilities

Another major sticking point concerns enriched uranium and Iran’s enrichment facilities.

All sides understand that preventing Iran from obtaining nuclear weapons is a “red line” and non-negotiable condition for Israel — something Prime Minister Netanyahu reportedly reiterated to Trump in a phone call yesterday and received reassurances about.

Iran has reportedly agreed, as part of the deal, to surrender all stockpiles of enriched uranium and dismantle enrichment and nuclear weapons development facilities. The problem lies in how this process would occur.

Tehran remembers the previous nuclear agreement — the so-called “Obama deal” — in which international inspectors monitored Iran’s nuclear program for peaceful purposes and oversaw disposal of enriched uranium and toxic waste.

This time, however, Trump’s team reportedly insists that enriched uranium be handed directly to American authorities, who would physically transport it from Iran to the United States. Trump also wants Americans — not international inspectors — overseeing the dismantling of Iran’s nuclear program, believing the previous international inspection regime had been deceived.

From Tehran’s perspective, such a process resembles the humiliation of a defeated country surrendering after war.

3. Public Declaration Against Nuclear Weapons

This issue appears to be an Iranian counterproposal intended to break the deadlock over uranium enrichment.

Iranian officials are reportedly willing to publicly declare that Iran neither seeks, intends, nor plans to develop or acquire nuclear weapons. Such a declaration would obviously satisfy Israel to a very large extent and is now being considered in Washington.

The key question is whether this declaration could serve as the “counterbalance” Iran wants in order to avoid what it sees as a humiliating process demanded by Trump.

There is also a timing issue: Trump reportedly wants any agreement regarding uranium enrichment to remain in force for at least 20 years. Iranian sources suggest this could be one reason why the enrichment issue may ultimately be excluded from the peace agreement altogether.

Mistrust on Both Sides

Analysts say both sides remain deeply suspicious of each other. For this reason, several more days will likely be required even after the preliminary agreement and any remaining obstacles are resolved before a final peace agreement can be signed.

If — or rather when — this happens, a 60-day ceasefire period would begin.

Over the past 24 hours, both American and Iranian officials have emphasized the concessions they hoped to secure. Iranian officials said Saturday that a possible agreement might only stipulate that nuclear issues would be negotiated within 30 to 60 days.

“If an agreement is reached,” Trump wrote on social media Sunday, “the United States could lift the blockade of Iranian ports,” which Washington had used to pressure Tehran into reopening the Strait of Hormuz.

Secretary of State Marco Rubio stated that the United States is ready to begin “very serious talks” regarding Iran’s nuclear program if Iran reopens the Strait of Hormuz, implying that the Trump administration may accept a temporary agreement that does not immediately eliminate Iran’s nuclear capabilities.

“You can’t solve nuclear issues in 72 hours on a napkin,” Rubio said Sunday during a visit to New Delhi. “The strait must reopen immediately, and then we will begin, based on agreed parameters, very serious negotiations on enrichment, highly enriched uranium, and their commitment never to acquire nuclear weapons.”

Why Oil Prices Are Falling… Only Slightly

In any case, it is obvious that the parties appear very close to a peace agreement — something Israeli Prime Minister Benjamin Netanyahu also hinted at after speaking with Trump by phone. Markets seem to be receiving encouraging signals, judging by the decline in oil prices.

Brent crude fell about 1.5%, slipping below the psychological threshold of $100 per barrel to $99. West Texas Intermediate crude dropped roughly 5% to $92 per barrel.

This relatively cautious decline in oil prices may indicate that investors and analysts also remain wary of both negotiating sides. They appear to be waiting to see whether the agreement currently being crafted will actually be finalized.

Investors may also recognize that it could take several more months before global shipping through the Strait of Hormuz fully returns to normal. More than one-fifth of the world’s traded oil passes through the strait.

Currently, between 1,500 and 2,000 ships remain stranded in the Persian Gulf. Even if the strait reopened tomorrow, restoring normal shipping operations would still take considerable time.

Shipowners and marine insurers would first need confidence that the agreement is durable and that it is safe for massive oil tankers — and their crews — to transit the route again.

In addition, since Iran’s navy is now effectively nonfunctional, the United States and allied naval forces — possibly including assistance from Greece and the Hellenic Navy — would reportedly need “at least several weeks” to deploy minesweepers and clear naval mines believed to have been laid by Iran.

Until completely safe shipping corridors are established and guarantees exist that the strait is free of explosives, marine insurers may require tankers to travel with escorts or under additional security measures, increasing delays and transportation costs, according to the International Energy Agency.

“At least two to three months will likely be needed before export operations can be fully restored,” the agency reportedly noted.