Islamabad MoU Trashed: Iran Declares Peace Deal Dead, Accuses US of Breaking All Promises

Exactly 1 month after its signing, the Pakistan-brokered Islamabad MoU between the US and Iran has completely collapsed following escalating military strikes and intense clashes over the Strait of Hormuz.

Last Updated : Saturday, 18 July 2026
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Washington: The peace deal between Iran and the United States is finished. The agreement that was signed on June 18 collapsed exactly 30 days later on Saturday, July 18. Iran has officially declared that the Islamabad MoU is dead. Deputy Foreign Minister Kazem Gharibabadi said America broke every promise it made under the deal. In response Iran has stopped honouring its own commitments. This is the first time Iran has formally stated that the MoU is over and that it will not implement any of its clauses.

Pakistan had brokered the deal and spent weeks presenting itself to the world as a great champion of peace. That image now lies in ruins along with the agreement itself.

What the deal was supposed to do?

The Islamabad MoU was built on three pillars. A ceasefire between the US and Iran. Safe passage of ships through the Strait of Hormuz. And a framework for reaching a broader agreement within 60 days. Both sides had also agreed on confidence-building measures and a roadmap for future diplomatic talks. Pakistan called it a major diplomatic achievement and took credit for bringing the two sides together.

When did it start falling apart?

Cracks appeared almost immediately. The first serious dispute was over the Strait of Hormuz. Iran and the US had different interpretations of how ships should pass through the strait. Iran attacked vessels that were passing through Omani waters, insisting ships could only use routes it had approved. America hit back, striking Iranian naval assets and ships. The US then began rolling back oil export relief measures that had been part of the deal. Iran called that a violation.
Iran also accused America of failing to release frozen Iranian funds and of not stopping Israel's military operations in Lebanon. Trump fired back saying Iran was not following the ceasefire terms. He declared the deal dead. Military tensions escalated again and technical talks broke down entirely.

What has been happening on the ground?

In recent days the US has hammered Iranian power infrastructure, naval assets, ports and bridges. Iran has responded by hitting American bases in Kuwait, Bahrain and Qatar. The war for control of the Strait of Hormuz has been intensifying by the day.

Were there overnight attacks on Friday-Saturday?

US Central Command confirmed that strikes on the seventh consecutive night hit surveillance sites, military logistics infrastructure, underground weapons storage facilities and maritime assets. Iran hit back hard. Kuwait suffered serious damage after Iran struck a desalination plant and an oil facility on Saturday. A fire broke out at the oil facility and injured several people. Multiple power generation units at the desalination plant had to be shut down after it caught fire. This was the second attack on a Kuwaiti desalination plant in two days. Kuwait gets 90 percent of its drinking water from desalination. Losing that capacity even briefly is a crisis for the country.

Iran's Islamic Revolutionary Guard Corps also claimed strikes on two American military facilities in Jordan. Long-range missiles were fired at Al-Azraq Air Base and US command facilities there. Massive fires broke out following the attack. The Islamabad MoU that Pakistan sold to the world as a peace breakthrough lasted exactly one month.