People drive past an anti-US billboard depicting US President Donald Trump and the Strait of Hormuz, in Tehran, Iran, May 17, 2026. Photo: Majid Asgaripour/WANA (West Asia News Agency) via REUTERS

President Donald Trump on Thursday said the United States and Iran could sign a peace deal as soon as this weekend that would reopen the Strait of Hormuz to shipping, but Iran countered that it had not reached a final decision on an agreement.

The deal, if confirmed, would be the most significant diplomatic breakthrough yet to end the three-month-old war, which has killed thousands of people and sent global energy prices sharply higher.

Iranian media reported Foreign Ministry spokesperson Esmaeil Baghaei as saying that large parts of the negotiating text have been finalized but Iran would not compromise on its red lines.

“Iran has not yet reached a final conclusion on an agreement,” he said.

Trump, meanwhile, told reporters at the White House: “We just made a great settlement of the war with Iran.”

“The strait will officially open as soon as we sign, which could be soon, very soon, maybe over the weekend in Europe,” Trump told reporters at the White House. Vice President JD Vance could sign for the United States, Trump added.

When asked if Iran‘s Supreme Leader Ayatollah Mojtaba Khamenei has approved the deal, Trump said: “I understand the answer is yes.”

Trump’s announcement came after he called off planned military strikes on Iran, citing progress in talks. US stocks rose and oil prices fell on the news.

Since mid-March, Trump has repeatedly claimed that a deal with Iran to end the war was close. The two sides have traded strikes this week, straining a ceasefire announced in April.

“It’s a very strong memorandum of understanding that is a little conceptual,” Trump told reporters.

Trump has repeatedly said that any peace deal must ensure Iran cannot develop a nuclear weapon. Iran denies it is seeking such a weapon.

Iran‘s demands include the lifting of international sanctions, the release of billions of dollars in frozen assets, and recognition of its control of the Strait of Hormuz.

“We have a deal that Iran will never have a nuclear weapon, which was the whole purpose of what we had to go through to get this. So, it was a very big thing,” he said on Thursday.

REGIONAL LEADERS BACK DEAL, SAYS TRUMP

Critics within Trump’s Republican Party have said any agreement must close Tehran’s path to developing a nuclear weapon. Opposition from Iran hawks helped derail a previous effort to secure a deal to open the strait.

Trump said on social media the agreement had been approved by “the highest level” of Iranian leadership, as well as other countries in the region including Israel, Saudi Arabia, Qatar, and the United Arab Emirates.

After Israeli Prime Minister Benjamin Netanyahu spoke with Trump on Thursday, Netanyahu’s office said he expressed his appreciation for Trump’s commitment to securing a deal that includes removing enriched material, dismantling enrichment infrastructure, limiting missile output, and ending support for regional proxies.

Tehran had also been demanding an end to Israeli attacks in Lebanon, where fighting has continued in a parallel war between Israel and Iran-backed Hezbollah terrorists.

Trump told reporters that he would soon also talk to Turkey’s President Tayyip Erdogan.

The US and Israel launched airstrikes on Iran on Feb. 28, destroying much of Iran’s military industrial base over the next several weeks until the ceasefire was announced in April.