The beginning of ship traffic through the Strait of Hormuz and the continuation of negotiations with Iran lower oil prices and support the US stock market

The closure of the Strait of Hormuz by the US military to ships heading to/from Iran worsened Iran's financial situation, so it decided to return to negotiations with the US.

According to Reuters, representatives of the United States and Iran plan to hold talks in the Pakistani capital this week.

According to The New York Times, in Pakistan, the US offered Iran a compromise formula: freezing nuclear development for 20 years while abandoning the demand for their complete and irreversible dismantling. But Iran put forward a counter-condition – to postpone development for only 5 years.

According to the Wall Street Journal, over 20 commercial vessels have passed through the Strait of Hormuz in the past 24 hours, but the US Central Command (CENTCOM) reported that six merchant vessels from Iran followed orders from the US military to turn around and returned to Iranian ports.

Yesterday, Fox News reported that the US Treasury Department had warned banks in Oman, the UAE, Hong Kong and China that it had evidence of sanctions violations. In a letter sent to the banks, the Treasury Department said that they “allowed Iranian funds to pass through their systems to fund illicit activities,” and that these institutions could face sanctions that would remove them from the US financial system.

Yesterday, June Brent crude futures fell 4.7% to $95/barrel (-1% for the month, +35% since the start of the war), and May WTI crude futures fell 8.4% to $91.2/barrel (0% for the month, +40% since the start of the war). Recall that WTI crude has become more expensive than Brent amid growing demand from the US and the blockade of the Persian Strait. In addition, about 100 tankers are currently heading to the US for loading.

According to Vortexa, the volume of crude oil stored on stationary tankers for at least 7 days decreased by 35% in the week (April 4-10) to a 5-month low of 89.13 million barrels.

Hopes for an end to the war led to a sharp rise in American markets, whose capitalization increased by $1.4 trillion in just 2 days. Thus, the S&P 500 index increased by 2.12% in two days, adding $1.27 trillion in capitalization, and in the last 11 days - $5.8 trillion in capitalization. The Nasdaq index increased by 2.85% in two days (+$960 billion in capitalization).

Hopes for restoring peace in the Middle East are also given by the first direct negotiations between Israel and Lebanon in the United States, where a decision was made to normalize relations and disarm Hezbollah, which is losing financial and military support from Iran.

The International Energy Agency (IEA) says that more than 80 energy facilities were damaged during the conflict, and the restoration of which could take up to two years.