28.05.2026 - Iran Conflict reflames
Markets once again face renewed geopolitical escalation after recent optimism around a possible US-Iran deal faded quickly.
Only lately, US officials stated that an agreement with Iran appeared very close, with reports suggesting that only final signatures were missing. However, the conflict reflamed after the US started new attacks against Iran, while Iran responded accordingly.
The latest statement from Iran further increased tensions:
“No peace in Middle East until Israel is ‘destroyed’.”
Markets:
Equities: Slightly lower after recent strong gains as investors previously priced in a fast de-escalation scenario.
Bonds: Bond yields moved higher again as oil prices rebounded on renewed supply concerns. US 10-year Treasury yields moved back above 4.5%, while Japanese 10-year yields also continued to rise to 2.7%
Commodities: Oil prices gained sharply again amid fears around energy supply disruptions - WTI USD 91, Brent USD 96. Precious metals traded lower short-term despite the geopolitical escalation - gold USD 4400, silver USD 73
Cryptos: lower - Bitcoin fell back towards USD 73k.
Currencies: USD unchanged
Volatility: The VIX moved back above 17 as uncertainty increased again.
My View: I maintained the view that I do not believe in a fast end to the conflict. Hearing all the recent statements and observing the geopolitical developments, I decided not to follow the current mainstream positioning of investors.
Personally, I saw many of the recent optimistic US statements more as attempts to stabilize and ‘manipulate’ markets and sentiment rather than reflecting a sustainable solution.
Therefore, I remained positioned in oil, did not add further equity exposure, and in contrary reduced exposure by adding short positions. At the same time, I remained invested in precious metals, where I continue to see attractive mid- to longer-term upside potential.
The current market environment still appears highly headline-driven, while many investors continue to underestimate the longer-term risks for inflation, energy markets, and global economic stability.
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