Hormuz Day 90: A Tentative MoU Is the First Real Off-Ramp, and It Is Unsigned

SITREP

281200Z MAY. US officials say American and Iranian negotiators have reached a tentative memorandum of understanding to turn the April 8 ceasefire into a more durable 60-day settlement. The core bargain: the Strait of Hormuz reopens to unrestricted transit with no tolls, Iran removes the mines it laid within 30 days, and the US lifts its naval blockade of Iranian ports in proportion to the restoration of commercial shipping. In exchange, Washington issues sanctions waivers letting Iran sell oil. The draft also carries Iranian commitments never to pursue a nuclear weapon and to open the 60-day window by negotiating disposal of highly enriched uranium and a path on enrichment.

This is the closest thing to an off-ramp in 90 days of crisis. It is also unsigned. The deal is pending Trump’s final approval, and Iranian state media says it is not finalized on Tehran’s end either. It lands inside a live escalation: US “self-defense” strikes hit mine-laying boats and a SAM site at Bandar Abbas around May 25 (Fars reported four killed), and on the night of May 27 Iran fired a ballistic missile at Kuwait that CENTCOM called an “egregious ceasefire violation.”

The Terms

Item	What the draft says	Catch
Hormuz transit	Unrestricted, no tolls, no harassment	Physical reopening lags the signature
Mine clearance	Iran clears within 30 days	Verification and tempo unspecified
US blockade	Lifted “in proportion” to restored traffic	Conditional, not a clean swap
Sanctions	US waivers so Iran can sell oil	Waivers, not statutory relief; reversible
Nuclear	No weapon; negotiate HEU disposal, enrichment	Hardest issues deferred into the window
Lebanon	Israel-Hezbollah fighting ends	Separate track, fragile

The Sequencing Problem

A swap only works if both sides trust the order of moves, and this draft does not give a clean one. Iran clears mines over 30 days while the US lifts the blockade “in proportion to” restored commercial traffic, so each side is asked to act on the other’s partial performance. Iran has spent the war demanding guarantees the war will not resume; Washington has spent it striking inside Iran during a ceasefire it insists is holding. Neither has reason to move first, and the May 25 to 27 exchanges show how little it takes to stall the clock.

The Sanctions Read

The relief is structured as waivers, not a lifting of the underlying regime. That distinction is the whole risk. Waivers issued under existing OFAC authorities can be revoked by the same executive that grants them, with no act of Congress required, which is precisely what happened to the JCPOA framework in 2018. For a refiner in India or a trading house in the Gulf, a 60-day waiver against a reversible backdrop and secondary-sanctions exposure is thin cover. Expect cautious, discounted lifting under tight documentation rather than a rush back to Iranian barrels. Asset unfreezing, if it materializes, runs through correspondent banks that will demand certainty the MoU does not yet provide.

The Oil Read

Brent traded in the high $90s into the announcement, ~$96 intraday, capping a month that ran ~19% lower, its worst since 2020. Most of the de-escalation premium has already come out of the curve on reopening hopes dating to the May 23 “largely negotiated” comment. The asymmetry now favors the downside on a clean signing and the upside on a collapse, but the near-term floor under prices is physical, not political: the strait stays shut until mines are cleared and war-risk insurance reprices. Underwriters will not write Hormuz hulls on a press briefing. Until clearance is verified and rates fall, open transits stay near the post-May 6 floor regardless of what the paper says.

Scenarios

• Most likely (50%): Trump signs a modified version within 7 to 10 days; mine clearance and insurance lag, so physical reopening trails the announcement by weeks.
• De-escalation (25%): Clean signing, verified clearance begins, Brent slides toward the high $80s as the risk premium drains.
• Escalation (25%): Sequencing dispute or another Kuwait-style strike collapses the draft; the loose truce frays back toward open exchange.

Watch For

• Whether Trump signs, and what he adds or subtracts before he does.
• Tehran’s official line beyond state media’s “not finalized.”
• First verified mine-clearance activity off Bandar Abbas and the strait.
• War-risk insurance quotes for Hormuz hulls; rates, not rhetoric, gate the reopening.
• OFAC waiver text: scope, duration, and any snap-back trigger.