The unachievable peace deal between Washington and Tehran now seems to be around the corner. Swiss sources confirmed that delegations from Iran, the United States, Pakistan, and some Middle Eastern countries will get together at the Burgenstock mountainside resort in the next couple of days to sign a document that has already been seen and approved by both sides. A signature on the dotted line will bring an end to the war between Iran and the US. But more importantly, it will provide relief to the rest of the world, troubled by the dual blockade of the Strait of Hormuz. International fuel prices have already fallen below $80 at the news of the impending peace deal.
While different versions of a potential deal are being published and talked about—a recent one by Arab News—the actual document won’t be available until it is finally signed in Switzerland. Some keen observers I spoke with said that the Arab News document is an American wishlist that may not get implemented in its entirety. Many claims are being made, including the lifting of sanctions, Iran agreeing to stop supporting its proxies in Lebanon, and the opening of Hormuz. However, according to sources in Pakistan who have an eye on the process, a potential deal would reflect the sensitivity of not just the two signing parties, but other stakeholders in the Middle East and Gulf, too. It is believed that the emphasis will be on opening Hormuz and sorting out the nuclear issue—two matters that are critical for the US.
It is important to note that the talks between the American and Iranian delegations broke down in Islamabad in early April, mainly on the nuclear issue. The sources claim that this remains a sticky point, with both sides trying to sort out the important issue of the extraction of enriched uranium from the bunkers, where the Iranians hid it during American aerial bombing. A twin question is which country would take this material for safekeeping.
US President Donald Trump mentioned in a Truth Social post in May that the US and China are the only two countries with the capacity to extract the material. However, four countries have apparently been named in the agreement: Turkey, Pakistan, Russia, and China. It is claimed that both Turkey and Pakistan declined to play the role, and the US did not approve of Russia, which leaves only China. Notwithstanding that Trump also opposed the idea of transferring Iran’s enriched uranium to China, Pakistani sources are of the view that China may end up playing a significant role. Some say that the role of safekeeping could also go to Azerbaijan, depending on when a final agreement on this issue is arrived at. Clearly, the agreement in Geneva will give a timeline of when and how the nuclear negotiations will proceed. But the country that both sides finally agree upon will only become obvious on the day of signing the deal.
The opening up of Hormuz, on the other hand, is believed to be the relatively easier and possible aspect of the deal, the one most likely to happen.
Balance in the Middle East
For Iran, the important matters pertain to an understanding on the future cessation of hostilities and attacks from the US, removal of sanctions, and payment of war reparations. In an interview with CBS, US Vice President JD Vance mentioned the possibility of Iran getting paid about $300 billion as war reparations and removal of sanctions. However, a close look at the interview indicates that the figure of $300 billion may not necessarily be paid to Iran. For the US, it is critical to link any payment not just with the promise of good behaviour by the Iranian regime but also to ensure some level of confidence among the Gulf states. This means that any money paid to Iran will be conditional, and sent carefully. A lot of commitment of funds will come from Middle Eastern regional states carefully watching Iran’s behaviour.
Just a couple of days ago, some sources I spoke with in Islamabad are of the view that the US could pay a much lesser amount of $24 billion, split into four or five portions. Others believe that the payment may not be under the tag of removal of sanctions, but to aid Iran in de-mining the Hormuz or in measures it would be expected to take to ensure peace in the region. It could also be in the form of aid to help with Iran’s development. Also, there is a role to be played by Gulf countries such as Qatar and Oman in opening some financial doors for Tehran.
For the US, it is equally critical to keep the balance in the Middle East, which means providing some resources to Iran but not opening the financial floodgates in a manner that would flip the geopolitical balance in the region. It is believed that sending a large chunk of resources that could help Iran get back on its feet completely may not be appreciated by America’s Gulf allies.
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End of one chapter
The other sticky point from the Middle Eastern peace perspective is Lebanon. Israel has already expressed displeasure with the peace deal, considering that any formal American commitment on Lebanon would mean a future for non-state actors that could compromise its security. Sources from Pakistan are of the view that this issue may remain hanging. The idea is that while Lebanon could get mentioned in the peace deal, there will be a broad understanding that this may not be tightly linked with the signing of the deal. In any case, the Iranian commitment to not supporting the proxies in Lebanon mentioned in the Arab News’ version of the agreement sounds dicey, as it places a lot of responsibility on Iran’s shoulders that it is not likely to agree to.
The three things obvious from the chatter on the agreement so far are: (a) the war between Iran and US will end, (b) the air of tension in the Middle East is likely to remain but with the possibility of trade and communication reopening, and (c) a window of opportunity will be opened up for Iran without seeming to open a wider door for it to dominate regional politics. The agreement may be closing one chapter of conflict, but it is not likely to change the overall environment in the region. As someone I spoke with remarked about the days to come, “The party has just started.”
Ayesha Siddiqa is a senior fellow at the Department of War Studies at King’s College, London. She tweets @iamthedrifter. Views are personal.
(Edited by Prasanna Bachchhav)