US-Iran peace talks fail, oil prices surge
- US-Iran peace talks fail
- Trump threatens to block Strait of Hormuz
- Oil rallies on supply risks
- Gold remains pressured by inflation fears
Over the weekend, US-Iran peace talks concluded without a resolution.
Despite a marathon 21 hours of negotiations, both sides were unable to agree on key issues, including Iran’s nuclear program and its control of the Strait of Hormuz.
Hours after Trump threatened to block the Strait of Hormuz from Monday 10 am ET.
This fresh uncertainty was reflected across markets this morning, with risk aversion affecting equities, while oil benchmarks surged amid rising geopolitical risk premiums.
In the commodity space, oil benchmarks surged as the US vowed to blockade all vessels passing through the Strait of Hormuz.
Brent rallied as much as 9% to roughly 104$ a barrel as supply shock fears returned with a vengeance. Deepening conflict may keep oil prices elevated, with triple digits potentially becoming a new normal amid extreme supply tightness.
Gold initially declined on rising inflation concerns as oil prices surged. Despite prices jumping back above $4700 bears remain in control amid rising inflationary risks.
Given how expectations have basically diminished over lower rates in 2026, gold is likely to remain on the backfoot with a stronger dollar keep bears in the game. Key levels of interest can be found $4825, $4700 and $4600.
