The United States and Iran signed, on June 19, a memorandum of understanding that formally closes the acute phase of the conflict known as the Twelve-Day War and commits to the full reopening of the Strait of Hormuz. The signing took place in Switzerland, with Pakistan as the principal mediator and a sixty-day window for pending operational closures.

The agreement follows the initial ceasefire of April and the technical negotiations announced last week, when [Pakistan confirmed that the text of the deal was ready](https://www.nbcnews.com/world/iran/live-blog/live-updates-us-iran-drones-trump-deal-war-hormuz-tehran-rcna349750) and Tehran was finalizing its internal deliberations. Coverage from [PBS NewsHour on the initial agreement](https://www.pbs.org/newshour/amp/world/iran-and-u-s-reach-an-initial-deal-to-extend-the-ceasefire-and-open-the-strait-of-hormuz-but-challenges-remain) and [NPR's report on the signing](https://www.npr.org/2026/06/15/nx-s1-5858590/us-iran-deal-updates) both confirm that toll-free navigation for at least sixty days is the centerpiece of the commitment. The UN Secretary-General acknowledged the role of Pakistan, Turkey, Qatar, and Saudi Arabia as facilitators of the process.

The subsequent logistics, however, will be slow. Shipping operators have warned that it will take weeks to clear the bottleneck that built up in the strait during nearly four months of disruption. Goldman Sachs revised its Brent forecast to $80 per barrel for the fourth quarter of 2026, down from a prior projection of $90, and to $75 for the 2027 average. Crude was trading below $80 at Wednesday's close, well below the highs above $100 recorded in March, when Iran shut the waterway in retaliation.

For Latin America the signal is twofold. Mexico, as a net crude exporter, will revise its petroleum revenue expectations and the assumptions underpinning the 2027 budget package. The rest of the region will face reduced imported inflationary pressure through lower fuel and freight costs, a meaningful relief for central banks still debating the pace of rate cuts.

The next test will be operational: the first wave of vessels crossing Hormuz without escort, and the rate decisions by Banxico, the Central Bank of Chile, and the Central Bank of Brazil in July will set the real cost of de-escalation for the region.

Frequently Asked Questions

What is the Twelve-Day War and why is it called that?

The acute phase of the conflict between the United States and Iran lasted approximately twelve days before the April ceasefire, according to coverage from international agencies cited by PBS NewsHour and NPR.

What changes with the June 19 memorandum?

The memorandum signed in Switzerland formally closes the conflict and commits to toll-free reopening of the Strait of Hormuz for at least sixty days, according to NBC News's report on the agreed text.

How long will it take for international oil prices to fall?

Goldman Sachs reduced its Brent forecast to $80 for the fourth quarter of 2026; analysts warn that clearing the vessel backlog in Hormuz will take several weeks.

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