[MARKET ANALYSIS] Trump stated that he thinks the ceasefire with Iran is "over", spurring sustained strength in the crude complex

The Iran situation took a back seat over the past week or so, but has now emerged as a key driver this week. Following Iran’s decision to hit Saudi and Qatari tankers, the US struck various sites in Iran. As a result, Iran then hit regional partners, including Bahrain and Kuwait. As it stands, it appears that the firing from either side has concluded, but markets now remain attentive to where this goes next.
US President Trump, who was speaking at the NATO Summit in Ankara, berated the Iranian regime. He stated that it is a waste of time dealing with Iran, and ultimately stated that he thinks the ceasefire and MoU is “over”. The mention of he “thinks”, gives the US a little bit of optionality on whether the deal is actually over; he stated that he will allow US negotiators to continue to talk. Nonetheless, the risks of a wider escalation remain; markets now await clarification on whether the MoU has officially ended, the Iranian response and also how Qatari/Pakistani mediators react to the comments made by Trump. Markets will also be watchful for any updates to the timeline of negotiations between the US and Iran, which are currently pencilled in for July 11th.
WTI and Brent started the European session with gains in excess of 2%, but surged higher following the Trump comments; currently +6.5%. WTI Aug’26 holds at the top end of a USD 71.75-75.13/bbl range, whilst Brent Sept’26 sits near peaks of USD 75.44-79.00/bbl range. The latter remains well below the levels seen following the initial signing of the Islamabad MoU (USD 85/bbl), which signals some hopes that a) the Strait will remain open, b) the current MoU holds. On this theme, markets remain in backwardation, with front-month Brent prices still higher than second-month; should this flip, it would indicate that traders expect another large-scale supply glut.
Spot gold (-1.2%) trades lower this morning, and at the bottom end of a USD 4,050-4,133/oz range. Much of the pressure came following the Trump comments, given the USD strength and the inflationary implications of the ceasefire being over. Base metals are broadly lower, given the risk-tone; 3M LME Copper trades at USD 13,190-13,396/t range.
On the ags front, reports recently have suggested that China has purchased more US soybeans; the state-owned Cofco booked at least another five cargoes overnight for loading, Bloomberg reported. Overall, news which will points to a positive relationship with US President Trump and Xi. At this morning’s presser, Trump stated that China has been treating the US right, adding that he is a big fan of President Xi.