US waives Iran sanctions after talks; Lebanon fighting abates

The United States granted Iran a 60-day sanctions waiver on Monday following the first round of talks under a newly established peace agreement, while officials reported a continued reduction in fighting in Lebanon under efforts aimed at ending hostilities across the region.

The developments came after a tense weekend that threatened the week-old accord. U.S. President Donald Trump had warned that military action could resume if Iran interfered with shipping through the Strait of Hormuz after Tehran announced the strategic waterway was closed. However, tanker traffic through the strait began to recover on Monday, and oil prices continued to decline.

U.S. Vice President JD Vance said discussions with Iranian officials in Switzerland had established a strong foundation for a final peace agreement, although Iran denied that negotiations on its nuclear program had begun.

The conflict involving U.S.-Israeli attacks on Iran and Israeli military operations in Lebanon has killed thousands of people and displaced millions. The war has also disrupted global markets and pushed oil prices higher. However, oil prices settled 3% lower on Monday after Vance reported progress in the negotiations.

Representatives from both sides met at the Qatari-owned mountain resort of Buergenstock in Switzerland, where they agreed on a roadmap toward a permanent agreement within 60 days, according to mediators Pakistan and Qatar.

The parties also agreed on a mechanism to end fighting in Lebanon between Israel and the Iran-backed Hezbollah group. In addition, they established a communication channel aimed at ensuring safe passage for commercial vessels through the Strait of Hormuz and preventing further conflict in the vital shipping route.

As part of the initial economic relief measures outlined in the agreement, the U.S. Treasury announced a sanctions waiver effective through August 21. The waiver allows Iran to sell oil and related products and receive payment for those exports.

### Vance Expresses Optimism

Vance, who has maintained a positive outlook since the memorandum of understanding was signed last week, said Iran had agreed to allow nuclear inspections and create mechanisms to manage frozen assets abroad and oversee ceasefire arrangements.

“We laid a very good foundation for a successful final deal,” Vance told reporters after the talks.

However, Iranian Foreign Ministry spokesperson Esmaeil Baghaei told the state-run IRNA news agency that Iran had not discussed nuclear issues or made any new commitments.

Trump said on Truth Social that Iran would agree to weapons inspections to ensure what he called “nuclear honesty.”

“If Iran doesn't live up to their agreement, or if they're not behaving, I will do what I have to do,” Trump later told reporters.

Iran has significantly limited inspections by the International Atomic Energy Agency since the United States and Israel launched air strikes last year and suspended them entirely after the war began in February. Tehran continues to insist that its nuclear program is intended solely for peaceful purposes.

Iranian Foreign Minister Abbas Araqchi said the agreement secured sanctions waivers for oil and petrochemical exports, access to some frozen assets abroad, and the launch of a reconstruction and development plan for Iran.

Vance also said White House envoy Jared Kushner had proposed a mechanism under which the United States and Qatar would oversee Iranian funds once they are unfrozen, allowing the money to be used to purchase American agricultural products such as corn, soybeans, and wheat.

“So, the money that we lift is going to go to our farmers,” Trump said.

However, Iranian Central Bank Governor Abdolnaser Hemmati disputed that claim, saying Iran would not be required to spend the funds solely on U.S. products. According to Iran's Tasnim news agency, some of the unfrozen assets could be used to purchase other non-sanctioned goods.

### Ceasefire Holds in Lebanon

Technical discussions are expected to continue throughout the week.

The interim peace agreement calls for an end to all hostilities, including the conflict in Lebanon, which intensified after Hezbollah launched attacks across the border and Israel responded with military operations.

Although Israel is not a party to the peace agreement and has stated it will not withdraw its forces from Lebanon, it agreed to a new ceasefire on Friday. While fighting continued for another day, Lebanese officials said violence has significantly decreased since Saturday night.

Israel and Lebanon are scheduled to begin a new round of talks in Washington on Tuesday. Beirut remains committed to direct negotiations despite concerns that Lebanon's issues may be overshadowed by Iran's broader discussions with the United States.

Hassan Wazni, director of a hospital in the heavily bombarded southern city of Nabatieh, said the area has experienced its first extended period of calm since the war began.

“I’m monitoring the situation day by day, and most of the time I’m sleeping in the hospital. This is the longest a ceasefire has held,” Wazni told Reuters.

More than one million Lebanese have been displaced by the conflict. While some residents have started returning home, many remain cautious about the fragile ceasefire.

In the southern town of Qennarit, mourners carried the coffins of four women killed during a wave of Israeli air strikes on Saturday. The coffins were draped in yellow Hezbollah flags bearing the group's emblem. -Reporting by Humeyra Pamuk and Dave Graham in Buergenstock, Laila Bassam in Beirut and Reuters bureaus; Writing by Timothy Heritage, Peter Graff; Editing by Sergio Non, Alexandra Hudson, Alexander Smith and Sanjeev Miglani/Reuters