Mediation led by Pakistan and Gulf nations is nearing a memorandum of understanding to extend the current six-week truce by 60 days, with negotiators reporting convergence of views and a final draft under review. Officials expect a potential announcement within three to four days as bargaining centers on ending hostilities on all fronts.

Key differences remain over the future of Iran’s nuclear program and demands for sanctions relief, neither of which are currently on the table for the draft agreement. The US insists that Iran must relinquish highly enriched uranium and commit to never developing a nuclear weapon, maintaining leverage in negotiations.

The proposed deal includes a gradual reopening of the Strait of Hormuz, a vital energy passage closed since the conflict began on February 28. Restoring free passage could ease global supply chain bottlenecks and reduce volatility in freight rates and oil shipments.

Reopening the strait and extending the ceasefire could dampen oil price spikes and lower market volatility, benefiting bank trading desks and corporate lending divisions. However, unresolved sanctions and nuclear uncertainties continue to pose downside risks for financial institutions with energy sector exposure.