There is one report floating around and it suggests that Marco Rubio reached out to Iran's leaders this week to open talks on a ceasefire. Iran didn't even answer. Then the US went through France to try to open up talks and Iran said its goals weren't achieved yet.
What are the goals? A longer-term energy crisis, like $200 oil.
The thinking is that Iran has prepared for this fight for generations and is still in a position to execute the strategy, daring the US navy to enter the Strait of Hormuz to try and help ships get through.
There is some backing for this talk as the WSJ today reports:
Arab diplomats trying to find a diplomatic path out of the war now being waged by the U.S. and Israel against Iran say Tehran, emboldened by its ability to rattle the global economy by choking oil shipments, has laid out steep preconditions for any return to talks.
Iran wants firm guarantees it won't be attacked again along with reparations. These demands were relayed by the Supreme Leader yesterday but we've also now learned that he was nearly killed in a strike, with the US saying he's "disfigured".
There is also the constant braggadocio from top US officials, including Haggseth that the operation is going better than expected and Trump can stop it at any time. The market is skeptical and that's why the forward curve on crude is marching higher.
It's also starting to get baked into stock markets with the Fear & Greed Index now into extreme territory.
That dynamic has Bank of America feeling contrarian.
"We suggest fading oil >$100/bbl, US$ (DXY) >100, 30-year UST yield >5%, SPX <6.6k, levels set to provoke war/oil/Fed/tariff policy response to short-circuit Main St risks"
It's compelling and it's landing somewhat today with all those trades moving in their direction except the dollar.
My guess is that everyone is trying to time the TACO and that's the right move but it depends on your assessment of how bad Iran truly wants to fight and what the US is willing to pledge in order to end the battle.
