Trump said yesterday the Strait of Hormuz is ‘permanently open’ and that China agreed to stop arming Iran. If true, that’s a meaningful de-escalation of the Gulf situation that had crude elevated for months.
Oil sold off on the news, but only about 1%. WTI is still sitting above $91, Brent above $95. For a permanent resolution to a strait-closure risk that's been embedded in prices for months, thats a pretty underwhelming response. Iran hasn't confirmed any deal publicly. And on the same day the US Senate blocked a bill limiting Trump’s Iran war power, so the military option didn’t actually go anywhere.
The split atm is interesting: Nasdaq ripped about 1.4%on the same headlines. Tech is treating this like it’s real. Crude is not.
Also buried in Reuters: the US is now probing suspicious oil trades made before Trump’s recent Iran pivots. Not sure what to do with that detail but it feels like a signal imo.
Genuinely curious whether crude is just slow to reprice or whether the commodity market sees something about this deal’s durability that equity traders are missing.