Mysterious US-Iran Pause Shakes Markets!
The United States halted attacks on Iran for the second night after nearly two weeks of military operations. Iran also signaled it would not resume retaliatory attacks during the pause.
The pause in fighting came after 13 nights of US attacks aimed at weakening Iran's ability to attack merchant ships. However, there has been no official explanation for the reason for the pause or President Donald Trump's next steps.
Amid the lull in fighting, Iranian and Omani officials held talks on shipping in the Strait of Hormuz. The meeting was described as constructive and yielded some progress, although shipping traffic in the vital waterway has not yet returned to normal.
News of the pause in attacks was immediately welcomed by the market. Brent oil prices plunged 7.4% to below US$90 per barrel, while US stock futures rose.
However, the risk of conflict has not completely disappeared. The Houthi group claimed responsibility for attacks on Saudi Aramco-related facilities in Jizan and Yanbu, while the Saudi-led coalition retaliated by attacking Houthi military positions.
The Strait of Hormuz remains nearly paralyzed, even though this route previously carried about a fifth of the world's crude oil supply. Disruptions in the Red Sea alternative route could also push oil prices up again if attacks on Saudi shipping continue.
As a result, oil markets could potentially remain under pressure while the attacks pause and negotiations continue. Gold could gain limited strength as inflationary risks from energy begin to subside, while the US dollar could weaken as demand for safe-haven assets declines. However, all three could reverse if the conflict escalates. (asd)*
Source: Newsmaker.id
