Iraq’s gratitude for Iran’s decision to permit oil tankers through the Strait of Hormuz suggests easing tensions. The odds of a US-Iran ceasefire by April 7 have dropped to 1% YES, down from 12% last week.
Iran’s gesture towards Iraq contrasts with its hostility towards US and Israeli-linked vessels. The April 15 ceasefire market is at 6% YES, down from 22% last week. The April 30 contract is now at 18% YES, showing traders’ skepticism about a quick resolution.
Despite the positive signal to Iraq, market sentiment remains bearish. The May 31 contract is down to 36% YES from 46% yesterday, and the June 30 contract holds at 52% YES, as traders watch for potential developments in May.
Trading volume hit $431,402 in USDC over the past 24 hours. A 5-point market move requires $12,352, indicating moderate liquidity. The largest price change was a 2-point spike in the April 30 market, suggesting a brief rally on the news.
Iran’s selective easing for Iraq might be tactical rather than strategic. At 18¢, a YES share for an April 30 ceasefire pays $1 if resolved — a 5.5x return. Traders would need to believe in rapid diplomatic progress to bet on this outcome.
Watch CENTCOM and IRGC communications, and any intermediary actions by Oman or Qatar. A confirmed date for US-Iran talks would significantly impact the market.
Markets Impacted
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