Iran has made clear it intends to keep control over the strategic Strait of Hormuz, a key sticking point in the Middle East peace talks with Washington that recently wrapped up in Switzerland.

Vice President JD Vance described the negotiations as a “very good foundation” for a final agreement to end the conflict, noting Monday that the U.S. had suspended sanctions on Iranian oil. However, critical issues remain unresolved despite the preliminary deal between the two nations—particularly Iran’s nuclear program and the fate of the Strait, a major artery for global oil shipments.

Technical follow-up talks to the higher-level Swiss negotiations have now concluded, with working groups on nuclear matters and sanctions set to be established, according to Iranian state media Tuesday.

President Donald Trump has demanded the unconditional reopening of the Strait to maritime traffic, but Iran has pushed back forcefully.

“The Strait of Hormuz will never return to its pre-war conditions and will be administered by the Islamic Republic of Iran, in accordance with international law,” Iran’s chief negotiator Mohammad Bagher Ghalibaf said, as reported by state media Tuesday.

The waterway had briefly reopened last week after Washington and Tehran reached an initial agreement, but Tehran announced Saturday that it had shut it again in response to Israeli attacks in Lebanon.

According to Qatari and Pakistani mediators, the two sides have agreed to establish a communication line “to avoid incidents and miscommunication with the aim of safe passage for commercial vessels” through the Strait.

As part of the arrangement, Washington agreed to release $12 billion in frozen Iranian funds, Iranian state media reported Tuesday, and temporarily suspend oil sanctions against the Islamic Republic. The U.S. Treasury said the decision involves a temporary lifting of sanctions to allow Iran to produce, sell, and deliver crude and related products through August 21.

Vance said Iranian assets have not yet been unfrozen under the deal and that, if they were, the funds would be used to purchase U.S. goods such as soybeans and would not finance terrorism. Iran has been subject to asset freezes and sweeping sanctions by the United States and other Western nations since its 1979 Islamic revolution, which overthrew the U.S.-backed Shah.

The latest round of negotiations, launched this weekend in Switzerland, raised hopes for a lasting settlement and pushed oil prices lower. Pakistan and Qatar are mediating the talks, which aim to produce a final document within a renewable 60-day deadline.

Diplomatic efforts continued Tuesday, with Iranian President Masoud Pezeshkian set to travel to Pakistan, state media reported, following the Swiss talks. U.S. Secretary of State Marco Rubio is due to begin a trip to the United Arab Emirates, Kuwait, and Bahrain to discuss the deal and “efforts to secure full and free safe transit through the Strait of Hormuz,” according to his spokesman Tommy Pigott.

The developments follow a joint announcement by mediators Pakistan and Qatar that U.S. and Iranian negotiators had agreed on a “roadmap towards reaching a final deal within 60 days.” “Encouraging progress has been made,” they said, citing the establishment of a contact channel to “avoid incidents and miscommunication” in the Strait.

Vance said Iran would allow UN nuclear inspectors to return to the country. However, Iranian Foreign Ministry spokesman Esmaeil Baqaei said “a very brief discussion took place regarding the nuclear issue, but there was no discussion of details.”

The inspections were originally established under the 2015 nuclear deal, which Trump withdrew from in 2018. Iran suspended them after Israeli-American strikes on its facilities in June 2025. Since then, International Atomic Energy Agency inspectors have been unable to visit the affected sites, leaving uncertainty over the status of Iran’s stockpiles of highly enriched uranium—a major point of contention with Washington. Tehran has consistently denied seeking nuclear weapons while asserting its right to a full civilian nuclear fuel cycle.

On the Lebanese front, which Tehran insisted on including in the talks, a conflict management cell is to be established to halt fighting between Israel and the Iran-backed Hezbollah movement, which dragged Lebanon into the war in early March. On Monday, Lebanese President Joseph Aoun said he had received a call from Vance regarding “the issue of consolidating the ceasefire in Lebanon, stopping the Israeli military escalation and steps that should be taken in this regard, including the possibility of forming a cell for this purpose.”

The Israeli offensive in Lebanon, which Israel says is aimed at preventing Hezbollah attacks, has left more than 4,100 dead and over one million displaced, according to Lebanese authorities.