A memorandum between the United States and Iran to halt the war in ​the Gulf could be signed as soon as Sunday, a Western source told Reuters on Friday, with Geneva emerging as the likeliest venue.

The source said language in ‌the memorandum was still being finalised and Iran was sticking to its position that the deal must also end fighting in Lebanon, where Israel has been battling against the Iran-backed Hezbollah militia 

The aim was to finalise the wording by Saturday so the agreement could be signed by U.S. Vice President JD Vance and Iran's Parliament Speaker Mohammed Baqer Qalibaf. No venue had been established but Geneva was emerging as the likeliest.

Trump said on Thursday ​he was calling off new strikes on Iran because the deal was now ready.

"We just made a great settlement of the war with Iran," Trump told reporters in the ​White House on Thursday.

But the terms of the deal as described on Friday by Iranian officials appear to offer Tehran much of what ⁠it has demanded so far, with Trump appearing to win little of what he has sought, beyond the reopening of the Strait of Hormuz, which Iran shut after he ordered attacks in ​February.

A senior Iranian source told Reuters on Friday that the draft would waive sanctions on Iran's oil, unfreeze billions of dollars of its funds, and require a cessation of hostilities on all ​fronts, including in Lebanon.

Nuclear issues would be set aside for later talks. Washington wants a deal to ensure that Iran never develops a nuclear weapon; Iran says it is not seeking one.

The waiving of sanctions, unfreezing of Iranian assets and halt to Israeli attacks on Lebanon are essential Iranian demands. The source made no mention of what Iran might offer in return. There was no immediate response from the United States.

 -Reuters