How The US - Iran War Is Progressing

So, let's get straight to the point, because quite a lot has happened in the Middle East over the past few days.

On Friday, Trump said the United States was close to launching new, major strikes against Tehran. On Saturday night, he announced that he was canceling the attack because "the parameters of an agreement have been agreed upon." On Sunday, he said negotiations would begin on Monday afternoon. Then, on Monday morning, Iran came out and said that... there were no negotiations at all.

WHAT TRUMP ANNOUNCED

Late Saturday night, Trump posted a message that changed the mood across the Middle East. He said he was halting new attacks against Iran because Tehran itself, along with other countries in the region, had requested it.

What did the agreement he described include? Two things. First, the "immediate, full, and complete reopening of the Strait of Hormuz." Second, an end to Iran's nuclear threat. Trump said Israel had agreed to work with him to resolve the issue.

Shortly before the announcement, Trump also spoke by phone with Saudi Crown Prince Mohammed bin Salman, who reportedly expressed concerns that a new American strike could trigger Iranian attacks on Gulf energy infrastructure. The White House confirmed the call took place but declined to provide details.

Trump later told reporters that he had been prepared to launch the largest military operation since World War II, but that allies convinced him not to proceed.

Meanwhile, the State Department issued new security warnings on Saturday, advising Americans across the region to prepare for flight cancellations, temporary airspace closures, and other travel disruptions.

Then came Monday. Trump had said talks would begin that afternoon. Instead, Iranian Foreign Ministry spokesman Esmail Baghaei told reporters there was no immediate plan for negotiations with the United States.

Iran, he said, was only talking with Oman. And those discussions concerned only one issue: which shipping routes vessels would use through the Strait of Hormuz.

And how did Trump respond? With an angry post. He described the leaders of the Islamic Republic as "incredibly two-faced" and accused them of lying about the talks, which he insisted were taking place "whether Iran admits it or not."

"Nothing gets to Iran unless we want it to," he wrote. "And nothing will get through until there is either a Deal or Total Surrender."

There is, however, one major caveat. Trump insists that he has full control over the Strait of Hormuz. Yet shipping traffic remains only a fraction of its prewar average. And it's worth remembering something else: over the past five months, Trump has repeatedly said that "a deal is close," yet no permanent agreement has been signed, while the temporary ceasefire reached in June eventually collapsed.

HOW OIL MOVED

This is where the market comes into play. Because do you know what happened on Monday?

WTI crude fell more than 6% to $79.49 per barrel. Brent crude dropped nearly 5% to $83.73 per barrel. At the same time, stocks surged higher.

To understand the scale of that move, consider what happened beforehand. Both oil benchmarks had risen more than 20% over the previous month. Why? Because fighting between the United States and Iran had resumed, and attacks on tankers around Oman had increased.

As if that were not enough, OPEC+ approved an output increase of roughly 188,000 barrels per day starting in September.

Analysts at ANZ made an interesting observation. They argue that the oil market is becoming increasingly dependent on inventories and strategic reserves to absorb disruptions in the Middle East. The risk is no longer confined to the Strait of Hormuz. It is also spreading to Saudi Arabia's export corridor through the Red Sea.

INVESTMENT TAKEAWAY

In short, within three days we saw a canceled attack, the announcement of a deal, a denial from Iran, an angry Trump post, a 6% drop in oil prices, and a rally in stocks.

Once again, the situation changed completely in a matter of days. And once again, nobody knows how long the current calm will last.