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The Memorandum of Understanding (MoU) between the United States and Iran, which was signed on June 17, appeared briefly to have accomplished what weeks of fighting had left undone. It extended the ceasefire, opened the way for a return to negotiations and offered hope of restoring order to one of the world’s most important regions.
Early signs were encouraging. Merchant ships passing through the Strait of Hormuz, which carries about a fifth of the world’s oil trade, began to recover. Oil prices rose sharply, with Iran’s exports doubling from wartime lows under a temporary embargo. About 340 merchant ships passed through the Strait during the week of 22-28 June, making it the most difficult since the war began on February 28. For a short time, negotiations seemed to be going well.
However, within a few weeks, ships began to disappear from the coast again, military exchanges began again and the sheep were looking for a temporary alliance, just to save the original agreement. What appeared to be a diplomatic victory turned out to be another crisis in ending the war. Its rapid unraveling revealed the missing half of the mediation process: the parties agreed on political issues, but not on the measures to be implemented, while the countries that violated the agreement had no chance to act.
Part of the problem was that the signing of the agreement was seen as the end of the mediation rather than the beginning of its most difficult phase. The US and the mediators seem to be focused on obtaining political documents. Success was measured by signatures and public notices, not taking into account the difficulties that inevitably arise when governments, the military, regulators, banks, insurance companies, shipping companies and partners in the regions begin to establish cooperation. Questions of interpretation, sequencing, validation, conflict resolution and confidence building were delayed rather than resolved.
Like many anti-war arrangements, the June MoU relied heavily on ambiguity. This was understandable. Both Washington and Tehran need the political flexibility to present the deal as a win to domestic audiences and leave unresolved issues. Such ambiguities can lead to negotiations where full agreement is not possible.
But ambiguity is useful only if there are clear ways to manage the unresolved issues. Otherwise, disagreements simply move from the negotiating table to the implementation phase, where trust is low and the political cost of failure is high. The MoU also referred to maintaining the nuclear “status quo” without specifying what was allowed or prohibited. It decided to lift the sanctions without specifying under what authority or when the sanctions would be lifted. It also referred to Iran’s frozen economy without knowing how the money would be released, regulated or monitored. Public discussions indicated that around $12bn could be made available, however disagreements quickly arose as to whether the money would remain in a controlled account or be controlled by Iran indefinitely.
A similar weakness was seen in seafood. The agreement called for Iran to “plan to use its efforts to ensure the smooth passage of commercial ships” and negotiate with the Sultanate of Oman to explain the management and maritime activities of the Strait of Hormuz “in accordance with international law and the sovereignty of the countries on the Strait of Hormuz”. However, it has not established a unified system of governance, maritime security, inspection, navigation or dispute resolution. The language also allowed Tehran to interpret the agreement by identifying future responsibilities in managing the crisis.
Commercial vehicles also got off to a good start as markets responded well to the ceasefire announcement. Confidence, however, was not weak because the institutional arrangements needed to promote better delivery had not yet been approved. Although Washington committed to a 60-day temporary ban on the sale of small amounts of oil, banks, insurance and shipping services, many insurers, refiners and shipping companies remained cautious. The two-month court window was too short to allow for the restoration of long-standing, multibillion-dollar business relationships.
Iran undoubtedly benefited from the break. During the discount period, it is estimated to have sold around 70 million barrels of oil, worth around $5bn–$6bn. However, the oil loaded on the trains means that unlimited amounts of money reach Tehran. Uncertainty over sanctions, escrow arrangements and banking procedures prevented trade deals from bringing the financial relief envisaged under the agreement.
The ceasefire also gave both sides time to prepare for the possibility that talks could fail. The United States has also withdrawn military stockpiles and repositioned regional arms, while Iran has used it to temporarily control the political transition and continue operations through the funeral of its supreme leader. Mediators hoped that time would bring political progress. Instead, both sides used it to reinforce their views as negotiations ended. This article is a reminder that implementation is not just an administrative task that follows a good conversation; and diplomacy in other ways. Any disagreements over succession, sanctions, verification, compliance or interpretation will need to be resolved between parties if the agreement is to continue.
The failure of the MoU was not just due to poor drafting. They pointed to a deep weakness in the negotiation process: the countries that reached the agreement had enough confidence to bring the parties together, but not enough power to force them to resolve disputes or honor their commitments once they started.
One encouraging thing is that mediation has grown. What began mainly as a Pakistani initiative has turned into a major diplomatic partnership, with Qatar, Egypt and other regional organizations supporting efforts to restore the ceasefire and revive talks. This expansion increases the political, economic and mediation problems, increases diplomatic opportunities for regional stakeholders, including Israel, Hezbollah and others, and makes the process more difficult if any avenue is closed.
Growth alone, however, cannot solve the problem that has arisen. The additional mediators have a lot in common: they are reliable negotiators with strong regional ties, but they have little influence in the calculations of Washington and Tehran. They can facilitate discussions, reduce conflict and promote dialogue. They cannot, by themselves, guarantee fulfillment.
Recent theories illustrate this point. Mediators are discussing the reopening of the “Iranian official route” in the north, which has been affected by the US military blockade, along with the US-backed southern route where ships have faced Iranian threats. They are also considering ways to pay for the trip, perhaps through a mutual fund or measures that would allow Iran to collect money related to maritime security and environmental projects. These arrangements may help to revive the MoU, but on their own they cannot find time to end the war, restore confidence in trade or maintain meaningful sanctions.
Sustainable development requires a different approach to international aid. As negotiations move from policy acceptance to enforcement, strong external vindicators become increasingly important. Superpowers with significant economic, political and strategic influence can provide incentives, incentives and, if necessary, coercion that smaller mediating states cannot muster. Their involvement should not replace existing mediators, whose integrity and relationships remain important. Instead it should complement their efforts by providing the necessary opportunities to encourage implementation and assure the parties that their commitments will be repaid.
The challenge for the next phase of negotiations is not only to expand the group of mediators, but to distinguish its types. Credible regional advocates can bring Washington and Tehran to the table. But without guarantors who can encourage the implementation and investment of disobedience, any new agreement may face what will happen in the June MoU: signed with hope, viewed briefly and terminated quickly.
The views expressed in this article are those of the author and do not reflect Al Jazeera’s influence.