Trump States that the Peace Agreement with Iran is ‘Largely Negotiated’ as the Hormuz Discussions Reach the Final Stage-by Harold Gunatillake
Introduction: Trump shares an optimistic update on the Iran agreement. In a friendly and approachable tone, he describes the recent progress, noting that the deal has been ‘largely negotiated’ and that the final touches are being worked out between the U.S., Iran, and other important Middle Eastern partners. He also highlights the positive development that “the Strait of Hormuz will be opened, signalling progress. Mr Trump
warmly confirms his engagement with regional leaders from Saudi Arabia, the UAE, Pakistan, Egypt, Jordan, and Bahrain, as well as a productive call with Israeli Prime Minister Benjamin Netanyahu, which he describes as “went very well.’ He concludes on a hopeful note that ‘final aspects and details of the Deal are currently being discussed, and will be announced shortly,’ emphasising collaboration and forward momentum.
Washington / Gulf Region — U.S. President Donald Trump announced that a long-awaited peace agreement with Iran has been “largely negotiated,” signalling the most significant diplomatic breakthrough since the conflict escalated earlier this year. The development follows a tense cycle of military threats, regional pressure, and back-channel diplomacy involving multiple Middle Eastern states and international mediators.
Trump stated that the understanding was reached following a series of high-level conversations with leaders across the Middle East, including Saudi Arabia, the United Arab Emirates, Qatar, Pakistan, Egypt, Jordan, Bahrain, and Israel, all of whom have been involved in or supportive of the mediation efforts. He characterised the emerging agreement as a “Memorandum of Understanding about PEACE,” noting that negotiators are finalising the remaining details before a formal announcement.
Iranian officials have confirmed that discussions are advancing, with both sides collaborating on a 14-point framework to end hostilities and promote regional stability. However, Tehran has advised that certain issues remain unresolved, despite recent indications that positions have “converged.”
One of the most closely watched elements is the reopening of the Strait of Hormuz, which Trump said will be included in the agreement.
Reports indicate that the proposed deal may involve clearing mines, lifting certain blockades, and ensuring toll-free passage during a 60-day ceasefire window—steps that could ease global energy pressures and restore normal shipping flows.
While the final text has not yet been released, officials on all sides describe the momentum as positive, with expectations that a formal announcement could come soon.
The Strait of Hormuz framework has been successfully reached, marking a significant step forward. This achievement is truly encouraging and opens the door to future cooperation and progress.
At the centre of the emerging agreement is the reopening of the Strait of Hormuz, the world’s most critical oil and gas corridor.
Trump confirmed that negotiators have established a framework that would allow commercial shipping to resume under monitored conditions, easing fears of prolonged disruption to global energy markets.
The strait has remained partially restricted for weeks due to heightened military activity and Iranian defensive measures. Shipping insurers, energy traders, and governments have warned that continued closure could trigger severe economic shocks across Asia, including Sri Lanka.
Strike Paused After Gulf Allies Urged Restraint
The diplomatic momentum accelerated after Trump paused a planned large-scale military strike on Iran. According to U.S. officials, the decision came after Gulf Arab allies—including Saudi Arabia and the United Arab Emirates—privately urged Washington to give diplomacy more time, fearing that a full-scale conflict would destabilise the region.
The pause coincided with a new peace proposal from Tehran, delivered through Pakistan, which has been playing a quiet but pivotal mediating role. Pakistani officials have reportedly shuttled messages between Washington and Tehran over the past week.
Final Details Still Under Negotiation
Despite Trump’s declaration that the deal is “largely negotiated,” officials from multiple countries say key details remain unresolved. The memorandum of understanding is still being refined, with negotiators working on verification mechanisms, maritime security guarantees, and the sequencing of de-escalation steps.
Trump has held a series of calls with regional leaders—including Saudi Crown Prince Mohammed bin Salman, UAE President Mohammed bin Zayed, and Israeli Prime Minister Benjamin Netanyahu—to coordinate final positions ahead of the agreement’s announcement.
Diplomats say the coming days will determine whether the framework can be converted into a durable peace arrangement or whether unresolved issues could trigger another round of confrontation.
Global Stakes Remain High
The outcome of the negotiations will have far-reaching consequences. A stable reopening of the Strait of Hormuz would ease pressure on global fuel prices, restore confidence in maritime trade routes, and reduce the risk of a wider regional war.
For smaller economies such as Sri Lanka—already burdened by debt, inflation, and high import costs—the stakes are particularly high. Any sustained disruption in Gulf shipping lanes would directly affect fuel prices, transport costs, and the broader economic recovery.
A Fragile but Critical Moment
While Trump has projected confidence, analysts caution that the situation remains fluid. Iran’s leadership has signalled willingness to engage but insists that any agreement must include security assurances and relief from certain U.S. pressures.
For now, the world watches as negotiators attempt to convert a fragile pause in hostilities into a lasting diplomatic breakthrough—one that could reshape the strategic landscape of the Middle East and bring relief to global markets.
SIDEBAR: The Implications of the U.S.–Iran Breakthrough for Sri Lanka
Fuel Prices: Immediate Relief if Hormuz Reopens
Sri Lanka imports nearly all of its petroleum from the Gulf region. Any closure or tension in the Strait of Hormuz increases global crude oil prices, which in turn affect domestic fuel costs, electricity tariffs, transportation fares, and food prices. A stable reopening of the strait could alleviate pressure on the Ceylon Petroleum Corporation and help stabilise domestic inflation.
Shipping and Insurance Expenses
During the recent tensions, maritime insurers increased premiums for vessels traversing the Gulf region. Sri Lankan importers—particularly those importing essential commodities such as LP gas, crude oil, and fertiliser—encountered elevated freight charges.
The establishment of a peace agreement would diminish these war-risk premiums, thereby reducing the overall cost of imports.
Migrant Workers in the Middle East
Over 1.2 million Sri Lankans are employed in the Gulf region. Any escalation in tensions poses a threat to their safety and employment stability. A diplomatic breakthrough mitigates the risk of abrupt evacuations, job losses, or disruptions to remittances—one of Sri Lanka’s most crucial sources of foreign exchange.
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Tourism and Investor Confidence
Stability in the Middle East’s geopolitical landscape often boosts travel volumes and positively influences global investor sentiment. Sri Lanka, which remains in the process of revitalising its tourism industry, benefits from regional stability as airlines, travellers, and investors are more inclined to engage with the region.
Economic Breathing Space
With Sri Lanka navigating debt restructuring and IMF-linked reforms, even a slight reduction in global oil prices can provide
fiscal relief. A peaceful Hormuz means fewer external shocks for an economy already fragile.
A Fragile Peace, Yet a Critical Lifeline for Sri Lanka
President Trump’s declaration that a peace agreement with Iran is “largely negotiated” signifies a rare moment of stability in a region where a single miscalculation could have repercussions worldwide. For global powers, this represents a strategic advancement. For Sri Lanka, it is an issue of immediate importance: economic survival.
Sri Lanka’s susceptibility to Middle Eastern tensions is inherent, not situational. We depend on Gulf oil, Gulf shipping routes, and Gulf remittances. When the Strait of Hormuz becomes destabilised, our economy feels the repercussions swiftly. Fuel shortages, price increases, and currency fluctuations are not hypothetical threats—they are tangible memories.
This is why the pause in military escalation is significant. The decision to suspend a planned U.S. strike, the discreet diplomacy via Pakistan, and the coordinated discussions with Gulf leaders all indicate an acknowledgement that regional conflict would be devastating. For Sri Lanka, it would have resulted in rising fuel costs, increased import expenses, and renewed pressure on a population already burdened by the cost of living.
However, this moment also underscores our continued vulnerability. A nation that imports its energy, depends on migrant labour, and relies on secure sea lanes cannot afford to be merely an observer in international geopolitics. We must diversify our energy sources, enhance strategic reserves, and develop economic buffers to mitigate external shocks.
The emerging peace agreement is promising. It provides hope, stability, and an opportunity for global markets to stabilise.
Nevertheless, it remains fragile, sustained by diplomacy, shifting alliances, and the political considerations of influential nations. Sri Lanka must utilise this opportunity not to become complacent, but to prepare.
Here’s my view on what’s happening in Sri Lanka right now.
Despite recent efforts to stabilise the economy, the cost of living in Sri Lanka remains quite high. The official poverty line is about Rs.
16,500 per person per month, yet many families still struggle to cover basic food and non-food needs. Let’s explore some key aspects that shed light on the current economic situation:
**Rising Survival Costs:** The minimum monthly amount needed to meet basic needs is around Rs. 16,571. In bigger cities like Colombo, this amount can go up to Rs. 17,800 or even Rs. 18,000 per person, making it quite challenging for those earning minimum wages.
**Growing Nutrition Challenges:** The gap between the cost of a simple, energy-providing diet and that of a healthy, nutrient-rich diet is widening. A basic diet that keeps energy levels up costs about Rs. 468 daily for a family, whereas a nutritious diet costs over Rs. 1,707 per day. Sadly, nearly half of the population (about 47%) finds it difficult to afford an adequate, healthy diet.
**Inflation and Currency Fluctuations:** Recent increases in inflation — around 5.4% year-on-year in Colombo — along with a sharp depreciation of the Sri Lankan Rupee (with selling rates around Rs. 354 to the US Dollar), have made imported medicines, fuel, and everyday groceries more expensive.
Support from the Government:
To help those most affected during these tough times, the government continues to support programs like Aswesuma. However, many families still feel the strain as their purchasing power declines.
Stay informed about the latest district-by-district living costs and minimum expenditure thresholds by visiting the Department of Census and Statistics Poverty Line Dataset. For the most recent updates on inflation and the economy, don’t forget to check out the Central Bank of Sri Lanka’s Consumer Price Inflation portal.
The ASWESUMA Project.
Under the Aswesuma welfare program in Sri Lanka, monthly payment amounts are categorised by income level. Families with two or fewer members receive half of the stated allowance.
Standard Monthly Amounts:
Extremely Poor: Rs. 17,500 Poor: Rs. 10,000
Vulnerable: Rs. 5,000
Special Monthly Allowances:
Differently-Abled Individuals: Rs. 10,000
Chronic Kidney Disease (CKDU) Patients: Rs. 10,000 Elderly Citizens: Rs. 5,000
www.cabinetoffice.gov.lk
For specific updates or to check your eligibility status, visit the official Welfare Benefits Board or call the hotline at 1924.
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