Daily Take
The month-long pause in the US-Iran fight ended over the weekend. US forces struck Revolutionary Guard launcher positions on Larak Island in the Strait of Hormuz on Sunday, saying the crews were preparing to put sea mines into shipping lanes the military had just finished clearing. Early Monday, Iran's Revolutionary Guard said it answered with ballistic missiles aimed at two bases housing American forces in Jordan; Jordan's military said it intercepted eight, and gave no account of damage. Brent gapped about 3 percent higher and traded near $91 through the morning, with its high of $91.52 just short of the $92 line we set where the front stood before August's war premium unwound. The move sits at the front of the oil curve, which is what war-risk pricing looks like. Prices have answered the strike. Whether the exchange continues is the open question, and tonight's settlement renders the first verdict on the price test.
For paying subscribers below: the Brent settlement that would confirm the price move without yet proving its cause; why rates are the leading explanation for gold's decline despite a weaker dollar; and what a clean break above 3 percent in Japan's 10-year yield could set in motion.
Independent editorial analysis for information and education. Nothing here is investment advice or a recommendation to buy or sell a security.