Nick Edser
Business reporter

Stocks in Europe have opened higher as investors react to the framework deal between the US and Iran, with both Germany's Dax and France's Cac 40 share indexes up by about 1.7%.

In London, the FTSE 100 index rose 0.6%. The increase was smaller than elsewhere as shares in energy giants BP and Shell – two of the biggest companies in the FTSE 100 – were down about 4% on news of the lower oil price.

Earlier, Asian shares had surged, with Japan’s Nikkei 225 closing up 5%. Asian markets have seen more dramatic moves as many countries in the region are heavily reliant on the Middle East for oil and gas supplies.

Matt Britzman, senior equity analyst at Hargreaves Lansdown, says global equity markets were “starting the week firmly on the front foot”.

He adds that the framework deal has “given investors a clear reason to dial back some of the geopolitical risk premium that has hung over markets”.

Image source, AFP via Getty Images

President Donald Trump announced on Truth Social that the Strait of Hormuz would open once the "deal" is signed on Friday, "for purposes of mine removal".

As we mentioned in the previous post, Tehran effectively shut the strait - the world's busiest oil shipping channel - after Israel-US strikes in Iran on 28 February.

It could be "weeks to months" for mines to be cleared in the Strait of Hormuz, a retired US Navy rear admiral has told the BBC Radio 4's Today programme.

Admiral Mark Montgomery, who is also a senior fellow at the Foundation for the Defence of Democracies, says this will involve identifying and clearing all the mines, "so that you can have unrestricted transit without US military, or allied military vessels around, looking out for mines and doing constant cue route clearances".

It could also take up to two months for the world to feel "full relief" from the restriction on oil exports once traffic resumes, he adds, though he said there could be some "obvious relief" within a week.

Image source, Getty

In the last hour, Keir Starmer said he hopes the framework agreed by the US and Iran will "restore freedom of navigation in the Strait of Hormuz".

Traffic in the strait has ground to a halt since late February and thousands of sailors have become trapped in the Gulf. About 20% of the world's oil and gas supplies are usually transported through the vital waterway.

The US military has been blockading Iranian ports since April and last week the US military struck three vessels in the strait, killing three Indian sailors.

As of yesterday, US Central Command (Centcom) said it had disabled nine vessels and redirected 142 more since the blockade began on April 13.

As our Chief North America Correspondent Gary O'Donoghue writes, the exact status of the strait upon a framework deal being agreed is something over which divergent views are apparent.

President Donald Trump said on Truth Social that a deal is "complete" and that the strait would reopen "upon the signing of the Deal on Friday".

Iranian semi-official state agency Mehr News has reported what it says are the draft details of a 14-point memorandum of understanding between the US and Iran, including the reopening of the strait within 30 days, "under Iranian arrangements".

Image source, Getty Images

Let us turn to Downing Street, where UK Prime Minister Keir Starmer is speaking to journalists.

Ahead of announcing a new policy on social media access for the under-16s, Starmer says: "Before I start on social media, I want first to welcome the breakthrough reached last night between the US and Iran.

"I congratulate President Trump, the mediators from Pakistan and Qatar, and all those involved."

The PM continues: "This is a hugely significant moment. We have long called for de-escalation and it is vital that all parties see this opportunity to secure stability in the region, and restore freedom of navigation in the Strait of Hormuz."

Starmer says this will "ease the economic pressures" on Britons and those around the world.

He says the UK will now work "closely with our partners to support this agreement and to ensure that it turns into a durable, lasting peace".

We've had more regional reaction, with Egypt welcoming the agreement between the US and Iran.

The Ministry of Foreign Affairs describes it as a "highly significant development" that will restore "security and stability" in the region and around the world.

Its statement says the deal follows months of efforts by regional and international partners and opens "a new chapter".

It adds that it hopes this will be "a major turning point" in creating "a supportive environment for peace" and addressing other issues in the Middle East.

Image source, EPA/Shutterstock

Israel is yet to officially comment on the framework agreement between the US and Iran, which was announced last night by Pakistan.

This morning, we've heard from far-right Israeli National Security Minister Itamar Ben-Gvir.

Criticising the deal between the US and Iran, he says: "We are not partners to this agreement that does not ensure our security, and it does not bind us in any way."

He adds Israel should not settle for anything less than "the dismantling of Hezbollah", urging a continuation of action against the armed Lebanese political group.

"Every launch of a drone, UAV, or missile toward Israel from Lebanon will lead to an Israeli strike in Dahiya," he adds.

Ben-Gvir has often criticised his own government and has had sanctions imposed on him by the UK and other countries for "repeated incitements of violence against Palestinian communities".

Image source, EPA/Shutterstock

Ursula von der Leyen, President of the European Union Commission, has welcomed the agreement but says "the priority now is its swift and full implementation by all parties".

Von der Leyen says there should be an "immediate reopening of the Strait of Hormuz", describing freedom of navigation as "essential for regional stability and the global economy".

She adds the framework deal opens the door to broader negotiations on peace and security in the Middle East.

"And of course there can be no peace in the Middle East while Lebanon is in flames. Once again Europe calls on all parties to respect Lebanon's sovereignty and territorial integrity and implement a genuine ceasefire," von der Leyen says.

Von der Leyen goes on to say that European leaders who will be at the G7 this week in France will discuss the issue.

Peter Hoskins
Business reporter, Singapore

Asian shares are sharply higher as investors welcome the framework deal.

Japan's benchmark Nikkei 225 share index is up by around 5%, while the Kospi in South Korea is 4.8% higher.

Stock markets in the region have been on a wild ride in recent months, with shares often rising or falling sharply in response to developments in the US-Israel war with Iran.

Asian economies have been hit particularly hard by the effective closure of the Strait of Hormuz as they are heavily reliant on the Middle East for their oil and gas supplies.

Image source, EPA Shutterstock

This morning, we've had more European reaction to news of the framework agreement between the US and Iran.

António Costa, President of the European Council, says he looks "forward to an end to this costly war".

Writing on X, he adds the "weapons must now fall silent and outstanding differences must be resolved by peaceful means".

The EU's foreign policy chief Kaja Kallas describes the framework deal as "a potential breakthrough".

She says the agreement can "give much needed space for deeper negotiations".

Image source, Getty Images

Last night, Pakistan's Prime Minister Shehbaz Sharif said the US and Iran "declared the immediate and permanent termination of military operations on all fronts, including in Lebanon".

He added an official signing ceremony would take place in Switzerland on 19 June - the statement in full.

US President Donald Trump said "The Deal with the Islamic Republic of Iran is now complete".

He also said in a post on Truth Social that he authorised "the toll free opening of the Strait of Hormuz", and the removal of the US blockade of Iran’s ports.

In a second post, he said the deal would "bring Peace and Security to the whole Region”, and that the opening of the strait would mean “oil will flow on both ends again for the Region, and the World".

Iran’s Deputy Foreign Minister Kazem Gharibabadi confirmed in a phone call on state TV that a deal with the US had been finalised and that the official signing would happen in Switzerland on Friday.

"An immediate and permanent end to the war and military operations on different fronts including Lebanon will be announced tonight," he said.

Iranian state media has been reporting what it says are the draft details of a 14-point memorandum of understanding between the US and Iran, although the specific points have not been officially confirmed by either country - read the full list here.

The framework deal is crucial but also just a beginningpublished at 05:56 BST

05:56 BST

Gary O’Donoghue
Chief North America Correspondent

This agreement is quite a moment for Donald Trump – celebrating not just his 80th birthday on Sunday but also a major diplomatic breakthrough.

After so many false dawns, it seems that Washington and Tehran now agree on one thing – that a memorandum of understanding has been finalised, even if the elements stressed in each capital focus on those parts each finds it easiest to stomach.

Another key apparent element of agreement is that Lebanon does feature in both sides' description of the deal – though with Israel and Hezbollah not signatories, there will be significant doubt over their willingness to go along with it.

In truth, the deal – while crucial – is just a beginning.

It will kick off a period of 60 days during which the US and Iran will have to agree on how to destroy and remove Iran's nuclear material. That in itself could easily falter.

The exact status of the Strait of Hormuz is also something over which divergent views are still apparent, and the details around the timing of sanctions relief and the unfreezing of Iranian assets is still not consistent between both parties.

Many of these questions will linger until the full final text is made public.

One thing is clear, though: Trump's assurance to the Iranian people that "help was on its way" and that, when the US was finished, the government would be theirs to take does not look likely to happen any time soon.

A framework deal to end the Iran war has been reached.

Here's what you need to know about the latest developments:

• On Sunday morning, Israel launched strikes on Beirut's southern suburbs in response to "Hezbollah’s launch of aerial targets toward Israeli territory" earlier in the day, the IDF said
• Trump said Israel's strike on Beirut "should not have happened", and urged both sides to stand down as the US and Iran were "very close to a deal"
• The strikes at first appeared to threaten the ongoing negotiations between the US and Iran
• A framework deal was reached hours later, with mediator Pakistan first making the announcement
• Trump then confirmed the deal
• Iranian leadership also confirmed the deal and said it would be signed in Switzerland on Friday
• Leaders from the UK, France, Germany and Italy welcomed the announcement
• Specifics of the deal have not been officially confirmed, but Iranian state media reported that it includes an end to some US sanctions on Iran, Iran committing not to produce nuclear weapons, and a permanent ceasefire on all fronts including Lebanon
• Iran's deputy foreign minister said talks on a final deal will happen over a 60-day period

France will host the G7 in the lakeside resort of Evian-les-Bains from Monday, with the seven member states expected to discuss the framework deal between the US and Iran alongside other key matters.

Although the agreement is not due to be signed until Friday, G7 leaders will likely ask US President Donald Trump for further details of the accord, with a particular emphasis on the reopening of the Strait of Hormuz.

As we reported earlier, French President Emmanuel Macron has said leaders will also discuss the support for Lebanon under the new accord.

The informal grouping includes the US, the UK, Canada, France, Germany, Italy and Japan. The European Union (EU) will also be in attendance this week, but does not count as one of the core "7" as it is a bloc, rather than a single nation.

Other items on the agenda for this year's summit include support for Ukraine amid its war with Russia, and the rise of artificial intelligence.

Image source, Reuters

Earlier on Sunday, US Vice-President JD Vance told Fox News that the agreement with Iran had the potential to "fundamentally transform the Middle East for the next 50 years".

"This region of the world has been a basket case for my entire life and longer than that," he told the outlet.

Vance said Donald Trump had managed to "eliminate the threat of Iran".

He added that it will now be possible "to build to a new era of Middle East prosperity and success".

"Where frankly we can generate a lot of prosperity for the American people out of that region."

Shaimaa Khalil
Los Angeles

Iran's football team has arrived in the US for the World Cup, landing in Los Angeles just as a deal was announced to halt hostilities between Iran and the US.

The deal to end the fighting between the US and Iran came just a day before the Iranian team’s opening World Cup match against New Zealand in Los Angeles, easing fears of further escalation but doing little to remove the controversy surrounding the team.

Iran's striker Mehdi Taremi told the BBC the ongoing tension has overshadowed the tournament from the moment the squad arrived.

Preparations have also been disrupted.

The team faced visa problems and was forced to move its World Cup base camp to Mexico.

When Iran takes to the pitch in LA, many in the city's large Iranian community won't be there to watch.

Some are planning protests against Fifa's ban on the pre-revolutionary Lion and Sun flag, while others see the team as representing a regime they want gone.

The players insist they're here to unite Iranians and focus on football.

But for this squad, politics has been impossible to escape.

Ghoncheh Habibiazad
Senior reporter, BBC Persian

Iran's nuclear programme has been the focus of diplomatic talks, sanctions on Iran, and inspections for decades. It was often referred to by Donald Trump as the reason the US joined with Israel in launching strikes on the country in late February.

Iran maintains its programme is peaceful. The US and Israel have consistently rejected this and say there have been efforts to develop nuclear weapons.

Under a nuclear deal agreed in 2015, Iran had limited its enrichment to 3.67%, which can be used to produce fuel for commercial nuclear power plants. Weapons-grade uranium is 90% enriched or more.

Iran began openly escalating its enrichment levels after Donald Trump abandoned the previous agreement in 2018.

By June last year, Iran was enriching at 60% and had amassed a stockpile of 400kg, according to the International Atomic Energy Organization (IAEA).

The IAEA said last week it had been able to conduct a "routine inspection" at the Bushehr Nuclear Power Plant recently, but it had been almost a year since inspectors had been able to access other nuclear facilities.

UN Secretary-General António Guterres has welcomed "the announcement that the United States and Iran have agreed on a peace deal".

"This represents a critical step towards the peaceful settlement of the conflict," a spokesman said.

Japan's Prime Minister Sanae Takaichi was among the latest group of world leaders to praise the deal.

She says Japan "strongly hopes" that "free and safe navigation through the Strait of Hormuz will be ensured in practice, and that a final agreement on Iran's nuclear issue and other matters will be reached as soon as possible".

Australia's Prime Minister Anthony Albanese says he hopes the deal will lead to a "durable and lasting peace".

"While full recovery will take time, restoring this vital trade corridor is essential to easing pressure on energy prices and economies, including in our region," he says.

New Zealand Foreign Minister Winston Peters said it was a "pivotal, constructive deal" and "a step towards reducing tensions and promoting stability in a region that is critical to global economic security".

We heard before from the leaders of the UK, France, Germany and Italy.

Oil reserves will not be replenished soonpublished at 03:35 BST

03:35 BST

David Waddell
Business reporter

It will take some time before global oil reserves recover.

While some tankers are already positioned to sail straight back into the Gulf, many shipping lines are likely to wait for clarity on how the deal works in practice, and for signs of sustained de‑escalation.

ADNOC, the UAE state-owned oil company, has suggested that full oil flows through the Strait of Hormuz may not resume until the first or second quarter of next year, even in the event of a firm peace agreement.

In March, the International Energy Agency announced that its member countries would release 400 million barrels of oil from their strategic reserves. More than a third of that has already been drawn down.

While producers will seek first to meet the global oil demand (around 104m barrels per day), it will take many months for those reserves to be replenished.

The BBC's Global Affairs Correspondent, Sebastian Usher, talks through what we know so far about the initial agreement announced by the US and Iran:

What the deal means for US and Iranpublished at 02:57 BST

02:57 BST

Tom Bateman
US State Department correspondent

This agreement was ripe for taking place.

Donald Trump has been under growing pressure from the sustained hike in petrol prices which was feeding through to the highest inflation rate in the US in three years.

Iran's economy was being throttled with long-term sanctions currently tightened by the US naval blockade of its ports.

Both sides needed a reprieve.

The deal's priority is to extend the 8 April ceasefire in time and scope – another 60 days pledging no hostilities, lifting the US blockade in return for Iran relinquishing its grip on the Strait of Hormuz, while both sides commit to talks.

We don’t have the text yet but on the basis of how the deal was being briefed by the administration late last week it does not solve in any conclusive way the issues that apparently motivated Trump’s attack in the first place, nor those which drove Iran’s aggressive retaliation.

To get to something each side can sell as a victory, Trump needs a long-term (at least 20 years), verifiable prohibition on nuclear enrichment by Tehran.

Iran needs comprehensive sanctions relief and access to tens of billions of dollars in frozen oil revenues. Those issues and their sequencing have always been core sticking points.

While the deal may contain commitments or "understandings" to talk further about, it does not, as far as we know so far, meaningfully agree on them.

And that's before even mentioning the demands of Israel and hawkish Republicans in Washington that a final deal must also tame Iran's conventional weapons programme and the funding of its armed allies in the region.