President Donald Trump spoke for the first time on the Iran war Wednesday night. He told the country that “great goals are almost over.” Then he promised that he would grow up.
Oil was falling when Trump started speaking. It was 5% by the time he stopped – and that tells the whole story.
Markets Expect Peace. They Had The ‘Stone Ages.’
“We’re going to hit them hard over the next two or three weeks,” Trump said. “We’ll bring them back to the Stone Ages, where they belong.”
The statement lasted 19 minutes. It contained no new information, no timeline for an end to the war, and no plan to reopen the Strait of Hormuz. The markets were closed for two days they hope that Trump will announce a change plan. Instead, he promised more bombs.
Brent crude rose 5% to above $106 a barrel. West Texas Intermediate jumped 4.1% to $104. S&P 500 futures fell 1.1%. European futures were down 1.5%. Gold lost 1.4% to $4,691 an ounce. Silver was down 3%. The 10-year Treasury yield rose to 4.36%.
Bitcoin fell from a high of $69,135 to $66,818, down 3.3%. Ethereum fell 2.8% to $2,084. The entire two-day crypto conference ended in one evening.
Asia was hit hard. South Korea’s KOSPI fell 3.5%, the region’s worst performer. Japan’s Nikkei lost 1.8%. Hong Kong’s Hang Seng fell nearly 1%.
‘Just Take It’ – Trump Tells Allies to Defend Hormuz
Trump said the Strait of Hormuz would be “naturally opened” after the war. He urged the countries that export oil to other countries to “have the courage to hesitate” and to protect themselves from the river. He did not explain how or when that would happen.
A few hours earlier, at a Easter lunch at the White HouseTrump was dumb. He said the US “can just take their oil,” but added that Americans have no “patience” for that. He also mentioned South Korea, Japan, and China specifically, telling everyone to board Hormuz.
That message reached Seoul far and wide. The decline of the KOSPI by 3.5% reflects the insecurity of energy from abroad and the shock of the election of the US President.
Trump also backtracked on his April 6 threat to blow up Iran’s electrical grid. He made no mention of NATO, ground forces, or ongoing negotiations. The lack of reality was the only symptom. Investors were optimistic. They received ambiguity.
Iran Holds Hard, Toll Booth Stays Open
Iran has shown no interest in backing down. Minister Abbas Araghchi he said there are no direct talks with Washington and that Tehran’s dependence on the US is at zero. President Masoud Pezeshkian wrote an open letter in English to ask the American people that it is their interests that this war is really helping.
Meanwhile, Iran’s parliament continues to draft legislation to make its Hormuz payment system permanent. The IRGC already charges ships up to $2 million per voyage, denominated in stablecoins or Chinese yuan. If enacted into law, the government could ban any ceasefire.
That’s the difference in the market price. Trump says the strait will open naturally. Iran is building a pay house to last forever. Oil traders, bond traders, and crypto traders all came to the same conclusion on Wednesday night: the war is not going to end anytime soon.
A note Trump’s ‘Stone Ages’ Threat Sends Bitcoin Below $67K appeared for the first time BeInCrypto.
