MoU sinking with The Strait of Hormuz Tensions
A Critical Test for the Iran-US Memorandum of Understanding
By Our Geopolitical Correspondent
June 28, 2026
A recent flare-up in the Strait of Hormuz has placed the fragile June 17 Memorandum of Understanding (MoU) between Iran and the United States under severe strain. A series of tit-for-tat strikes over the weekend has not only threatened a return to open confrontation but has also exposed deep and potentially irreconcilable differences in how both parties interpret the agreement’s core provisions.
The escalation began on Friday when the Singapore-flagged vessel Ever Lovely was struck by a projectile while transiting the strategic waterway. This was followed by a similar attack on the Panama-flagged Kiku on Saturday. While Iran did not officially claim these attacks, the US responded with strikes on Iranian coastal radar and missile storage locations, citing “continued Iranian aggression against commercial shipping” in a statement from CENTCOM. These exchanges represent the first significant breach of the MoU since its signing just days prior.
The genesis of this confrontation lies in the interpretation of the MoU’s Article 5, which was designed to reopen the strait and restore the flow of commercial traffic. The agreement, which followed months of global energy disruption, states that Iran will use its “best efforts for the safe passage of commercial vessels with no charge for 60 days only,” and mandates the removal of “technical and military obstacles” and demining within 30 days. A fifth of global oil supplies passed through the strait before the US-Israel war on Iran began in late February.
While the text appears to establish a framework for safe passage, Tehran and Washington appear to be reading from vastly different scripts. A key point of contention is the article’s stipulation that “Iran will conduct dialogue with the Sultanate of Oman to define the future administration and maritime services in the Strait.” For Tehran, this is a clear affirmation of its sovereign authority over the waterway’s management.
In a recent visit to Baghdad, Iranian Foreign Minister Abbas Araghchi stated, “The Strait of Hormuz remains under the total oversight and management of Iran… There is no other party or state in this respect. This is totally clear under the memorandum of understanding.” This position is further underscored by the Islamic Revolutionary Guard Corps (IRGC), which has warned that the only “authorised route” is the northern corridor within Iranian territorial waters, effectively asserting a de facto control that challenges the principle of freedom of navigation.
This stance has been met with firm opposition from the US and its Gulf allies, who insist on unhindered shipping. Washington’s attempt to facilitate transits via a southern route closer to Omani waters, in coordination with the International Maritime Organization, has been met with Iranian warnings and practical enforcement. On Thursday, the IRGC forced four tankers transiting this southern route to turn back, leading to a sharp drop in traffic from 70 transits on Wednesday to 40 by Saturday.
Hassan Ahmadian, an associate professor at the University of Tehran, suggests that Washington is attempting to renegotiate the terms of its own agreement. “What we see is the United States trying to find its way out of this memorandum of understanding while obliging Iran to its end of the terms,” he told Al Jazeera. This perspective is echoed by Tehran-based analyst Abas Aslani, who views Iran’s control of the strait as a critical deterrent. “Iran sees [the strait] as leverage to stop the repetition of any new round of aggression against the country,” he stated.
The rhetoric from Washington has been equally robust. US President Donald Trump on Sunday warned of severe consequences, posting on Truth Social that while US forces struck Iranian targets “for violating the Cease Fire Agreement, AGAIN,” a point may come “when we are no longer able to be reasonable, and will be forced to militarily complete the job… If that happens, the Islamic Republic of Iran will no longer exist.” This was reinforced by US Vice President JD Vance, who affirmed, “violence will be met with violence.”
Iran’s Ministry of Foreign Affairs condemned the US strikes as “a blatant violation” of the UN Charter and a “clear breach of Paragraph 1 of the memorandum.” The IRGC launched ballistic missiles and drones at US forces in Kuwait and Bahrain in retaliation, signaling a readiness to escalate.
Despite the dangerous escalation, some analysts see a path to de-escalation. Vienna-based defence analyst Wolfgang Pusztai noted, “the scale of the retaliation of Iran and also the scale of the American attacks doesn’t really indicate that both sides are for full escalation. So to me it seems to be there is still a chance for a peaceful settlement of this question.”
Economic Implications
For global markets, the situation remains fraught with peril. The disruption to shipping lanes through the Strait of Hormuz is already having a tangible effect on global energy supplies. The increased risk premium on oil and the potential for prolonged instability present a significant challenge to global economic stability.
Looking Ahead
The coming days will be critical. The core issue remains whether the MoU can serve as a genuine foundation for peace or if its ambiguities, particularly Article 5, will prove to be its undoing. With both sides firmly entrenched in their interpretations and demonstrating a willingness to use force, the international community will be watching closely to see if diplomacy can prevail over confrontation in one of the world’s most critical waterways.
