Just one day after oil markets rallied on hopes of a US-Iran peace deal, American military strikes on targets in southern Iran sent Brent crude surging back above $98 per barrel on May 26. American military strikes on targets in southern Iran sent Brent crude surging back above $98 per barrel on May 26.
Bitcoin dropped below $73,000 in the aftermath, with over $1 billion in liquidations hitting the market as traders dumped riskier positions.
A tale of two trading days
On May 25, Brent crude fell 5% as markets priced in the possibility of a diplomatic resolution. The thinking was straightforward: a deal could reopen the Strait of Hormuz, ease supply concerns, and bring Iranian barrels back into global markets.
By May 26, US strikes on Iranian positions had pushed Brent crude back to between $98 and $102 per barrel, a jump of more than 2%. The peace talks that Pakistan and Qatar had been helping to facilitate suddenly looked like a footnote rather than a framework.
