Israel Alarmed by U.S.-Iran Understanding, Calling Iran the Biggest Winner

A memorandum of understanding signed overnight Thursday by U.S. President Donald Trump and Iranian President Masoud Pezeshkian has triggered concern in Israel. While Tehran celebrated the deal as a strategic victory, Israeli officials have not commented publicly, but behind closed doors they are sharply criticizing its economic, nuclear and Lebanon-related provisions.

One of the most troubling clauses for Israel is the U.S. decision to grant sanctions waivers on Iranian oil exports as soon as the memorandum takes effect. Under the agreement, the U.S. Treasury will issue licenses allowing Iran to sell oil and related products, including transactions in banking, insurance and shipping. Israeli assessments say this could inject billions of dollars into Iran’s economy after a period of heavy economic pressure.

Israel is also uneasy about the nuclear terms. The agreement does not require Iran to remove its stockpile of enriched uranium from its territory, but instead calls for dilution under International Atomic Energy Agency supervision. In Jerusalem, that is seen as a retreat from earlier U.S. positions and a sign Iran may retain much of its nuclear capability in any future arrangement.

The Lebanon clause is another source of dispute. The memorandum says the sides will work to end military operations on all fronts, including Lebanon, and refrain from mutual military action. Israeli officials fear this links the Iranian and Lebanese arenas and could later be used to pressure Israel to limit IDF freedom of action in southern Lebanon, though they note it does not require an immediate Israeli withdrawal.

In Tehran, senior officials portrayed the deal as evidence of strength. Parliament speaker Mohammad Bagher Ghalibaf said Iran comes to negotiations from a “position of strength” and that “the victory on the ground is the basis for negotiations.” Foreign Ministry spokesman Esmail Baghaei warned that continued Israeli activity in Lebanon could be treated as a breach of the memorandum. Israeli sources say Iran is the main beneficiary, though some security officials argue that a real slowdown in Iran’s nuclear program and reduced proxy activity could still offer long-term strategic gains.