Why the Iran Peace Deal May Not Be Good for the US

Friday marks eight years since President Donald Trump denounced the Joint Comprehensive Plan of Action (JCPOA), the Obama-era agreement that restricted Iran’s nuclear enrichment program in exchange for sanctions relief. As Tehran now weighs a different U.S.-led plan for peace with Washington, some experts warn the United States may not obtain a greater advantage than it had with the deal struck over a decade ago.

On May 8, 2018, Trump called the JCPOA, which was adopted in 2015, “one of the worst” transactions for the U.S. as he withdrew from the agreement, which had included capping Iran’s uranium enrichment purity and reducing its enriched uranium stockpile.

A new deal reported by Axios also targets Iran’s nuclear program, but unlike a decade ago, it has the immediately pressing concerns of ending the U.S.-Israeli war against Iran, stabilizing the oil market and unblocking of the Strait of Hormuz.

“Any U.S.-Iran peace deal is unlikely to look like peace at all. At best, it would be a ceasefire wrapped up in ambiguity, designed to let both sides claim victory while conceding as little as possible,” said Rajneesh Narula, a professor in international business regulation at Henley Business School in England.

Trump has said the ongoing “excursion” in Iran is much shorter than previous U.S. conflicts, such as the Vietnam War. But it is unclear whether the terms of the deal, which Axios reported was close to being agreed, put the U.S. in a better position than before it launched strikes on February 28.

“As Henry Kissinger once observed about Vietnam, sometimes not losing is victory enough,” Narula told Newsweek. “Iran has already won something intangible but powerful: It has survived confrontation with the U.S. without regime change.”

The Terms of the Deal

According to Axios, a 14-point memorandum of understanding was being negotiated between Iranian officials and Trump’s envoys Steve Witkoff and Jared Kushner. The report said the U.S. soon expected Iranian responses on key points as U.S. officials teased they were the closest to a deal since the war began.

There is much to be clarified, but according to the report, both sides would have to lift restrictions around transit through the Strait of Hormuz, the critical waterway Tehran has in effect blocked, which prompted the U.S. to impose its own blockade of Iranian ports.

This marks a significant shift in U.S. calculations, having previously rejected similar Iranian proposals for delaying nuclear talks. It also highlights the growing pressure in the U.S., where average fuel prices are more than 50 percent higher for Americans than before the war, said Tamsin Hunt, a senior analyst at S-RM, a global intelligence and cybersecurity agency.

“While Iran will gain concrete economic benefits from this deal-in the form of easing sanctions, unfreezing funds and resuming oil trade-the benefits for the U.S. are more remedial in nature,” she told Newsweek.

Any deal would kick off 30 days of negotiations in Islamabad or Geneva, with commitments from Iran to a moratorium on nuclear enrichment and the U.S. agreeing to lift its sanctions and releasing frozen Iranian funds, according to Axios. But any collapse in talks would also trigger a restoration of the U.S. blockade and further American military action.

“The 30-day deadline is a short time frame for complex negotiations compared to, for example, the talks for the 2015 nuclear deal that took almost two years,” Hunt said.

This deadline is likely to be extended, but without immediate resolutions on key areas of dispute, there is unlikely to be a firm end to hostilities in the short term, leaving the potential for sporadic clashes during the negotiation period, she added.

A long enrichment moratorium, increased inspections and the removal of highly enriched uranium would align with Trump’s objectives, but a deal in which there is major sanctions relief while Iran’s obligations remain temporary could leave the U.S. in a worse position.

“Any deal would likely recycle familiar promises. Iran would again pledge not to advance its nuclear program, a concession that costs little if key facilities have already been bombed or frozen,” Narula said.

He believed this would allow Trump to declare that he stopped Iran’s nuclear ambitions for good. In exchange, Tehran would quietly expect sanctions relief, especially on oil exports.

Iran’s Nuclear Ambitions

According to Axios, the two countries are discussing a moratorium on uranium enrichment that can be developed into a nuclear bomb. Iran proposed a five-year term restricting enrichment, the U.S. has demanded 20 years and other possibilities include 12 or 15 years.

However, Iran is unlikely to accept such a lengthy term without substantial concessions from the U.S., and there are a lot of unanswered questions around what a possible nuclear deal would look like, should negotiations resume, Erin Drake, a senior associate at S-RM, told Newsweek.

“For one, we’ve seen little indication of agreement around Iran’s enrichment levels, or what happens to its stockpile-a critical long-standing sticking point for Iran,” Drake said, adding, “Any viable and effective agreement will need to clearly address these technical elements, as well as the issue of who will monitor and enforce it, and how this will be done.”

The U.S. wants to stipulate in its deal that an Iranian violation on enrichment would prolong the moratorium, and Tehran would commit to never seeking a nuclear weapon or conducting weaponization-related activities, according to Axios.

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Crude oil prices – 5/7/2026

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Economic Costs for Americans Already High

Markets reacted with enthusiasm this week amid hopes for a major de-escalation in the Iran war. The price of Brent crude, the global benchmark, dipped; however, it rose again on Thursday to $101 a barrel as hurdles for a long-term resolution remain.

Trump halted Project Freedom, an initiative in which U.S. forces would escort vessels out of the Strait of Hormuz, and one Iranian lawmaker dubbed the move a “retreat.”

Even if a deal is struck, oil prices remain around 40 percent higher than before the war broke out, and Americans are feeling the knock-on economic effects in their pockets-with the national gas price average pushing past $4.50 per gallon for the first time since July 2022, according to the American Automobile Association (AAA).

“The Iran war has already increased costs on families in the U.S. by hundreds of dollars, and that is already baked into the cake,” Wayne Winegarden, a senior economics fellow at the Pacific Research Institute, told Newsweek.

“Even with a permanent end to hostilities, the economic costs will persist because it will take time for production and transportation to return to normal,” he said. “This also means that while gas prices will start trending downward once hostilities end, they will likely still be above 2025 prices even by the end of the year.”

Meanwhile, Iran now believes it has the upper hand as it holds the world hostage by closing the Strait of Hormuz, said Nick Berg, the Iranian-born author of Shadows of Tehran and a former U.S. special operations serviceman.

“The Islamic Republic has always played the long game, and they are waiting for the midterm elections in the U.S., hoping the U.S. side will have a change of heart and wants to close this as soon as possible, so they would be more willing to ease their redlines,” he told Newsweek.

“If there is a peace deal, I think it will look more like the JCPOA of the Obama era, with more restrictions on Iran, and it will also include a future operating model for the Strait of Hormuz,” he said. “For a peace deal to work, both sides have to walk away from it losing something.”

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This story was originally published May 8, 2026 at 7:29 AM.