Tehran, Iran – The memorandum of understanding (MoU) signed last week between Iran and the United States is facing collapse after two nights of military clashes in the Strait of Hormuz, coupled with a framework agreement allowing Israeli forces to maintain a presence in Lebanon.
On June 28, the Islamic Revolutionary Guard Corps (IRGC) released a video showing the launch of ballistic missiles targeting the U.S. Ali Al Salem Air Base in Kuwait and the U.S. Fifth Fleet in Bahrain, in retaliation for U.S. airstrikes. The missiles bore the words "war failed" in English and Persian, directed at President Donald Trump.
The incident followed U.S. coordination with Oman and the International Maritime Organization to route vessels through the Strait of Hormuz, forcing many ships into Omani territorial waters. The IRGC subsequently used drones to attack a container ship and an oil tanker, aiming to redirect traffic back to Iranian waters.
Speaking in Iraq on June 28, Iranian Foreign Minister Abbas Araghchi declared that Tehran would assume control of this strategic waterway for 30 days before permitting normal traffic to resume. He emphasized that the first clause of the MoU, signed on June 17, demands an immediate cessation of all military activities on every front, including Lebanon. He also called on the U.S. to pressure Israel into halting its offensives in southern Lebanon.
The U.S.-brokered framework agreement, signed between Israel and Lebanon on June 26, permits Israeli troops to remain in southern Lebanon until Hezbollah is fully disarmed. Hezbollah immediately rejected the deal, calling it a "humiliation and surrender" of Lebanese sovereignty.
Negar Mortazavi, a senior fellow at the Center for International Policy, argued that the Lebanon issue will negatively impact the MoU because Hezbollah was not involved, and previous ceasefires between Lebanon and Israel have frequently been violated. She noted that the disruption of oil exports through the Strait of Hormuz has caused market volatility and given Iran significant leverage: "They are using that leverage to the maximum, not returning to the pre-war state."
On June 28, Iran's President Masoud Pezeshkian, Parliament Speaker Mohammad Bagher Ghalibaf, and Chief Justice Gholam-Hossein Mohseni-Ejei held their first public three-way meeting since the war erupted more than four months ago. Supreme Leader Mojtaba Khamenei, who succeeded his father after a U.S.-Israeli airstrike, has yet to appear, but a new message attributed to him on June 28 stated that "criminals must be punished."
Domestically, over 60 hardline lawmakers postponed plans to protest the closure of Parliament after the speaker announced that sessions would resume following the funeral of Mr. Khamenei next month. On the streets of Tehran, many supporters of the IRGC continue to demonstrate, calling for further attacks to secure concessions from the U.S.
However, a significant number believe that the demands for concessions from the U.S. and Israel are unrealistic. Commentator Vahid Ashtari argued that Iran cannot counter the U.S. blockade or compensate for the lack of fighter jets to strike Washington: "We have missiles and drones for asymmetric defense, but we cannot retaliate for Khamenei or General Soleimani."
Iran's financial markets reacted negatively after the two nights of attacks: the rial depreciated against the dollar from its post-MoU gains, trading at 1.7 million rials to one U.S. dollar on Tehran's black market. The benchmark index of the Tehran Stock Exchange lost over 100,000 points, closing at just over 5 million points on June 28.
Mr. Vahid, a 37-year-old car mechanic at the Grand Bazaar in Tehran, reported that imported auto parts are becoming increasingly scarce and prices are rapidly rising. "I think war will break out again in the next few months, and some people in the bazaar think so too," he said.
