Trump says Iran gets no money in 60-day deal, warns of bombing

Trump said Iran will receive no upfront cash under the 14-point memorandum of understanding signed this week, warning the US would resume bombing "right smack in the middle of their head" if Tehran fails to comply during a 60-day negotiation window.

"If they don't behave, we'll go right back to dropping bombs right smack in the middle of their head, OK?" Trump told reporters at the G7 summit in Evian, France, before a state dinner at Versailles with French President Emmanuel Macron.

The agreement lifts the US naval blockade and reopens the Strait of Hormuz toll-free for 60 days, moves that sent Brent crude down 1% to $78.19 a barrel Wednesday. Pre-war levels stood near $70 before the conflict began Feb. 28. The deal also commits to a $300 billion reconstruction fund for Iran, though senior US officials said Washington is not required to contribute "a cent of money."

The Strait of Hormuz handles about 21% of global oil trade, and its closure sent energy prices surging, contributing to a slide in Trump's approval ratings. With negotiations set to begin Friday at Switzerland's Burgenstock resort, the question is whether 60 days is enough to resolve the nuclear dispute that triggered the conflict. Trump said the deadline is not hard — "it could take longer" — but added: "If it doesn't get done in 60 days, that's all right. We go back to bombing."

Iran's top negotiator, Parliament Speaker Mohammad Bagher Ghalibaf, struck a defiant tone, telling state broadcaster Fars that Iran's "finger is on the trigger" and that distrust of the US remains even if a final peace agreement is reached. The comments highlight the fragility of a deal that both sides acknowledge is only a framework.

The memorandum leaves the core dispute over Iran's nuclear program unresolved. The US and Iran agreed that Tehran "shall not procure or develop nuclear weapons" — the same commitment made under the 2015 Joint Comprehensive Plan of Action, which Trump abandoned in his first term. The IAEA will be tasked with inspecting what remains of Iran's nuclear infrastructure, Director General Rafael Grossi said, calling the agreement "a good step forward."

Oil Markets and the Strait of Hormuz

The immediate economic impact has been a decline in crude prices, though analysts warn the relief may be temporary. Brent crude has fallen more than 5% from its post-war highs but remains about 12% above pre-conflict levels. Shipping companies have said they will only resume normal operations once security guarantees are clear, with BIMCO, one of the largest international shipping associations, calling the situation "still very risky."

Five sanctioned Iranian tankers have already crossed the US blockade line in the Gulf of Oman over the past 24 hours, according to MarineTraffic.com data, while Qatari LNG tankers are heading back toward Gulf ports in anticipation of the strait's reopening. Iran's economy has suffered an estimated $270 billion in war damage, according to the government's spokesperson, with more than $24 billion in frozen assets held abroad.

Israel's Defiance Complicates the Deal

A major sticking point has emerged over Lebanon. The agreement calls for the "immediate and permanent termination of military operations on all fronts, including in Lebanon," but Israel has continued airstrikes in southern Lebanon. Prime Minister Benjamin Netanyahu's government says it is not bound by the US-Iran deal, with National Security Minister Itamar Ben-Gvir declaring: "Trump's agreement does not bind us."

Iran's Foreign Ministry said the continued Israeli presence in Lebanon would constitute a violation of the agreement, raising the risk that the ceasefire unravels before formal talks begin. Trump has expressed frustration with Netanyahu, telling the New York Times that the Israeli leader is "a very difficult guy" and complaining that Israeli operations in Lebanon "throw a negative light on the big deal."

This article is for informational purposes only and does not constitute investment advice.