Versailles Was Where Surrenders Were Signed
usapolitics.news — Analytical Journalism
Long read — approximately 7 minutes
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On June 17, Donald Trump signed a memorandum of understanding to end the war with Iran. He signed it at the Palace of Versailles, during dinner with French President Emmanuel Macron, following the G7 summit. The setting captured something essential about the agreement: it was designed to look like a conclusion while the actual contest continued elsewhere.
Trump signed the agreement at the Palace of Versailles — where surrenders are traditionally received, not offered — while Iran's chief negotiator was simultaneously announcing that the Strait of Hormuz would never return to pre-war conditions.
The Iranian side's description of the same document is worth reading carefully. Mohammad Bagher Ghalibaf, who led Iran's negotiating team in Switzerland, described himself not as a diplomat but as "a fighter." He described the Switzerland talks as "a direct continuation of the battlefield." He said negotiation is "a method of struggle and the continuation of struggle." He warned that any violation of the agreement "could be met with both military and diplomatic responses."
Pete Hegseth, the American Secretary of Defense, said in March: "If we need to negotiate with bombs, we'll negotiate with bombs."
Two men. One agreement. Identical metaphors. Neither is describing a peace. Both are describing a pause.
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The International Energy Agency characterized the war as the largest supply disruption in the history of the global oil market. Moody's Analytics estimates the war has cost U.S. consumers and taxpayers approximately $132 billion — the most visible piece being higher energy prices from the near-shutdown of the Strait of Hormuz. Gasoline prices, which averaged just under $3 a gallon when the war began, soared as high as $4.56 a gallon after the strait was cut off. Meanwhile, analysis by climate charity Global Witness for The Guardian found that major oil and gas companies made over $30 million an hour in the first month of the war. BP's first-quarter profit more than doubled year-on-year to $3.2 billion. Lockheed Martin's stock price rose nearly 40% from the start of 2026.
The cost of the war to the U.S. military was estimated at nearly $29 billion by mid-May, with the Pentagon requesting a further $200 billion. The Iranian government assessed damage to their economy at between $300 billion and $1 trillion.
The financial arithmetic of the war is specific: U.S. consumers paid $132 billion in higher costs. U.S. defense contractors and oil companies collected the revenue. Iran absorbed $300 billion in economic damage and emerged with permanent control of the Strait of Hormuz.
That last point is the one receiving the least coverage.
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Until the war, approximately 25% of the world's seaborne oil trade and 20% of the world's liquefied natural gas passed through the Strait of Hormuz. Iran closed it on February 28. The closure produced a global fuel crisis, fuel rationing across parts of Asia, and a 90% drop in commercial traffic through the waterway.
Ghalibaf this week stated that the Strait "will never return to its pre-war conditions" and that Iran will administer it going forward. Under international maritime law, it is not permissible to charge tolls for passage in natural straits. However, adjacent countries may charge fees for services such as insurance or docking. Iran is exploiting precisely that distinction — framing fees as service charges while establishing permanent administrative control over the world's most strategically significant waterway.
Paragraph 5 of the MOU states that Iran will make its best efforts for the safe passage of commercial vessels with no charge for 60 days only, and that Iran will conduct dialogue with Oman to define the future administration and maritime services in the Strait of Hormuz. The phrase "60 days only" is doing significant work. After 60 days, the charging regime Iran has been operating — requiring ships to negotiate transit with the IRGC — becomes the baseline unless a final agreement specifies otherwise.
Going forward, control of the strait will serve Tehran as an economic lever and a deterrent against future attacks. Tehran intends to lock in these gains in any agreement that concludes the war.
The 60-day window is the competition to determine whether Iran succeeds in locking them in.
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Trump initially claimed the Strait would be free immediately after signing. Iran forced him to correct that statement. Ghalibaf named this correction explicitly as a demonstration of Iranian leverage: "We forced Trump to amend the tweet he had published. This is the power of the Islamic Republic."
Iranian officials have yet to confirm the U.S. version of the text of the MOU. Neither side has released a physical copy — a U.S. official read the text aloud during a call with reporters.
Two governments signed the same document at the same time. They are publicly telling different stories about what it requires. That divergence is not a diplomatic footnote. It is the central vulnerability of the 60-day window. An agreement whose text both parties interpret differently is not a framework for negotiation. It is a continuation of the dispute by other means.
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The technical gap between the two sides remains exactly where it was before the war. The U.S. is pushing for a 20-year moratorium on enrichment. Iran has countered with five years. The head of Iran's Atomic Energy Organization has said Iran will not accept limits on enrichment at all.
The eighth clause of the MOU states that Iran reaffirms it shall not procure or develop nuclear weapons, and that the U.S. and Iran have agreed to resolve the disposition of stockpiled enriched material pursuant to a mechanism that will be mutually agreed upon, with the minimum methodology to be down-blending on site under IAEA supervision. "Mutually agreed upon" and "minimum methodology" are the phrases that will determine whether a final agreement is possible. They are placeholders for the most contested technical questions of the entire negotiation.
The current American negotiating team — Vance, Witkoff, Kushner — has 60 days to resolve what the Obama administration's team of nuclear physicists and career diplomats spent 20 months building. The Iranian team is led by a man who describes himself as a fighter and the talks as a continuation of the battlefield.
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In Tehran's view, the United States' decades-long containment of Iran has come to an end. The new regional order will be defined less by American primacy than by multipolarity, with China an increasingly central player and Iran an integral rather than a marginal actor.
Before the February 28 strikes, the Joint Chiefs of Staff warned Trump that an attack could prompt Iran to close the Strait. Trump acknowledged the warnings and dismissed them, telling his team that Iran would likely capitulate and that if they closed the Strait the U.S. military could open it again. Iran closed the Strait. The U.S. military could not reopen it by force. Several NATO allies — Germany, Spain, Italy, the UK, Australia, South Korea, and Japan — rejected Trump's request for military participation in reopening it. The Council on Foreign Relations concluded that Trump had concluded the conflict without a strategic victory, on terms that seem to favor Iran.
Ghalibaf said it plainly: "If problems arise in implementation, we can respond both with missiles and through negotiations."
Hegseth said it plainly: "We negotiate with bombs."
The 60-day clock is running. What it is counting down to is not yet a peace. It is a deadline by which both sides must determine whether the armed truce produces an agreement or resumes as a war.
Trump Truth Social posts
- Trump, Truth Social, June 15, 2026: "The Deal with the Islamic Republic of Iran is now complete. Congratulations to all! I hereby fully authorize the toll free opening of the Strait of Hormuz, and, simultaneously herewith, authorize the immediate removal of the United States Naval blockade. Ships of the World, start your engines. Let the oil flow! President DONALD J. TRUMP" — cited in ANI/X https://x.com/ANI/status/2066273414705459511; CFR https://www.cfr.org/articles/trumps-iran-deal-reopens-the-strait-much-remains-to-be-done; NBC News https://www.nbcnews.com/news/us-news/deal-reached-united-states-iran-war-rcna350039
- Trump, Truth Social, June 20, 2026: "There will be NO TOLLS in the Hormuz Strait for 60 days during the Cease Fire Period, and there will be NO TOLLS after the 60 day period has expired, unless they are imposed by and for the United States of America." — cited in Al Jazeera, Trump Vows Iran Will Not Charge Strait of Hormuz Tolls, But Says US Might, June 20, 2026. https://www.aljazeera.com/news/2026/6/20/trump-vows-iran-will-not-charge-strait-of-hormuz-tolls-but-says-us-might
Ghalibaf statements on Strait of Hormuz, Switzerland talks, and Iran's negotiating posture: Iranian media, June 23, 2026 — pasted article
Al Jazeera, What the Trump-Iran Agreement Says About Lebanon, Hormuz and Uranium, June 18, 2026. https://www.aljazeera.com/news/2026/6/18/what-the-trump-iran-14-point-plan-says-about-lebanon-hormuz-and-uranium
Foreign Affairs, Iran's New Grand Strategy: How a Remade Islamic Republic Will Reshape the Middle East, June 2026. https://www.foreignaffairs.com/iran/irans-new-grand-strategy
Wikipedia, 2026 Strait of Hormuz Crisis. https://en.wikipedia.org/wiki/2026_Strait_of_Hormuz_crisis — Gulf allies' losses; 90% drop in commercial traffic; Joint Chiefs warning; NYT energy revenue analysis
Wikipedia, Economic Impact of the 2026 Iran War. https://en.wikipedia.org/wiki/Economic_impact_of_the_2026_Iran_war — IEA largest supply disruption characterization; Iran $300 billion to $1 trillion economic damage
NPR, Here's How Much the Iran War Cost — and How Its Effects Will Linger, June 17, 2026. https://www.npr.org/2026/06/17/nx-s1-5860739/iran-war-cost-oil-military-trade — Moody's Analytics $132 billion cost to U.S. consumers; gasoline $3 to $4.56 per gallon; $29 billion Pentagon operational cost; $300 billion Iran reconstruction plan in MOU
Middle East Eye, The Oil, Gas and Arms Companies Profiting from the War on Iran, April 28, 2026. https://www.middleeasteye.net/news/oil-gas-arms-companies-profiting-war-on-iran — Global Witness/Guardian: $30 million per hour profit for oil and gas companies in first month; BP profit doubled to $3.2 billion; Lockheed Martin stock up 40%
Hegseth quotes: Al Jazeera, "Negotiate with Bombs": Hegseth Defends Second Night of US Strikes on Iran, June 10, 2026. https://www.aljazeera.com/news/2026/6/10/us-defence-secretary-hegseth-pledges-strikes-on-key-facilities-in-iran; Time, March 31, 2026. https://time.com/article/2026/03/31/hegseth-says-us-will-negotiate-with-bombs-until-iran-cease-fire-deal/
