US and Iran Sign Memorandum of Understanding on Sanctions Relief and Uranium Dilution

US officials have read out the official text of the memorandum of understanding struck with Iran, which includes American commitments to remove sanctions imposed on Tehran who in turn will agree to dilute its enriched uranium stockpile.

Details of the agreement had already been emerging prior to the call, including that it included a $US300 billion ($424 billion) reconstruction fund for Iran funded by private equity from a number of countries.

The agreement also says the US would work to end all American and United Nations sanctions imposed on Iran. In the meantime, the US will issue waivers to sanctions that will allow Iran to sell oil freely.

According to the officials, the draft agreement includes a new "minimum" standard for down-blending of highly enriched Iranian uranium and has provisions to ensure the "territorial integrity" of Lebanon after Israel's latest attacks against Hezbollah in Lebanese territory.

The US draft of the agreement also secures toll-free passage of the Strait of Hormuz for only 60 days, and it does not preclude fees in future, the officials said.

The agreement includes a commitment from the US and Iran to negotiate a final deal within 60 days.

The first point of the memorandum of understanding also stipulates that both sides: "declare the immediate and permanent termination of military operations on all fronts, including in Lebanon".

Lebanon has emerged as a key stumbling block in negotiations, with Israel continuing to carry out operations against Iran-backed militant group Hezbollah inside the country.

Israel's government has continued to insist it has the right to continue operations within Lebanon.

Nuclear concession a 'major, major win', US official says

Key to the agreement will also be Iran's nuclear enriched material, which the regime has agreed to downblend under the supervision of the International Atomic Energy Agency.

"The fact that they're conceding to that is a major, major win for the United States of America," one of the US officials said of the nuclear issue on a call with reporters.

The officials said a meeting between the US and Iran this weekend in Switzerland would be "critical" for seeing how the talks would proceed.

[PIC: Damage]

The US and Iran electronically signed the MoU over the weekend, but have indicated they will sign it again in person on Friday, local time.

Speaking at the G7 in France before the deal's release, US President Donald Trump cast some uncertainty over whether the signing would go as planned and added he was prepared to resume war if he was not satisfied with the deal.

"You never know with deals, do you? But you're going to find out pretty soon," he said.

G7 leaders laud 'very good deal'

Mr Trump also defended the deal's $US300 billion ($424 billion) Iran reconstruction fund, stating money would only flow to the regime "if they behave themselves".

"It's only $300 billion fund, it's only if they're doing things right."

Earlier, he had said: "If I don't like it, if they (Iran) don't behave, we'll go right back to dropping bombs right smack in the middle of their head, OK?"

The accord will likely draw intense opposition in Washington, and it appears to be a major setback for Israeli Prime Minister Benjamin Netanyahu, who has come under criticism at home from the media, his opponents and even some allies as details emerge.

But world leaders at the G7 meeting threw their support behind the US's tentative agreement, with French President Emmanuel Macron calling it "a very good deal".

Iranian Foreign Ministry spokesperson Esmail Baghaei was quoted by Iranian state television talking about the potential for Mr Trump to sign the agreement with Iranian President Masoud Pezeshkian.

Mr Pezeshkian became president on a promise of seeking better relations with the West.

However, he has been sidelined for months after Iran's mass killing of protesters in January and in the war as hard-liners have taken over the levers of the country's theocracy.