As one deadline after another passes without a peace agreement in the ongoing conflict involving the United States and Israel on one side and Iran on the other, the likelihood of failing to reach a decisive settlement in the coming months continues to rise. There are strong reasons why Washington, under President Donald Trump, may be comfortable with maintaining the conflict in a state of stalemate, including the effective closure of the Strait of Hormuz, one of the world's most important energy chokepoints. Similar reasons also exist for Tehran, where the Islamic Revolutionary Guard Corps appears inclined to preserve the status quo.

As a result, both sides may simply be using negotiations to calm domestic opposition without any genuine intention of ending the conflict quickly. If this scenario proves correct, the key question becomes: what are the short- and long-term implications for oil markets?

For the Islamic Revolutionary Guard Corps, which serves as the ideological guardian of Iran’s 1979 revolution and oversees the export of its influence through regional proxies, any peace agreement with the United States could become an existential threat. The core of every agreement proposed by Washington, from the original nuclear deal under President Barack Obama to the latest version under Trump, has ultimately revolved around dismantling the Revolutionary Guard in its current form.

The underlying concept promoted by the United States and its allies is to gradually dismantle the Guard’s financial, political, and economic structure inside Iran and integrate it into the regular military. Washington believes this process would eventually lead to the end of the Islamic system and its replacement with a democratic government.

For Washington, this objective remains part of its long-term strategy toward Iran. Given the catastrophic conclusions reached by Pentagon studies regarding any ground invasion of Iran, the US administration views prolonged sanctions pressure as the only realistic path toward achieving that goal.

However, the American strategy extends beyond Iran and is also linked to its broader rivalry with China. The United States seeks to reduce Chinese influence around the Strait of Hormuz after Beijing expanded its presence through extensive partnerships with Tehran. Washington is also working to secure other strategic routes around the world, including the Panama Canal and northern maritime corridors, as part of the global competition for influence with China.

From this perspective, a prolonged stalemate in the Gulf provides Washington with additional time to reshape the global balance of influence at Beijing’s expense.

At the same time, the United States is pursuing what some describe as the “Trump Doctrine,” which aims to reinforce American dominance in the Western Hemisphere by expanding oil production within the United States and among regional partners such as Venezuela, Brazil, and Argentina in order to offset any prolonged shortfall in Middle Eastern supplies.

Although oil prices have not yet risen as sharply as many expected since the conflict began, this is largely due to temporary and exceptional factors, most notably the massive release of strategic petroleum reserves and the elevated commercial inventories that existed before the outbreak of hostilities.

In March, member countries of the International Energy Agency launched the largest strategic reserve release in history, injecting 400 million barrels into the market. However, this measure is temporary, with more than 250 million barrels already consumed during April and May alone.

At the same time, US oil production was running at record levels of 13.6 million barrels per day, yet major oil companies showed little willingness to increase output rapidly, arguing that they were already operating close to maximum capacity.

Global markets are also drawing down commercial inventories at an unprecedented pace, while the closure of the Strait of Hormuz and damage to energy infrastructure across the Gulf have disrupted between 9 and 13 million barrels per day of production and refining capacity.

The International Monetary Fund has warned that global oil inventories could fall to their lowest level in five years by July.

At that point, the current period of relative calm in oil prices could begin to unravel quickly. Under the World Bank’s “major disruption” scenario, Brent crude could climb into a range between $120 and $135 per barrel by the end of the summer.

Such an increase would be driven by refiners seeking alternatives to heavy crude supplies from the Middle East, as well as shortages in refined petroleum products caused by declining commercial inventories.

Over the longer term, markets may once again focus on Iran’s longstanding warning that oil could reach $200 per barrel. The longer the crisis persists, the larger the risk premiums on prompt supplies are likely to become, especially once governments exhaust their strategic reserves.

That could trigger a new wave of aggressive buying that pushes prices toward record highs and potentially drives the global economy into a sharp slowdown as it adapts to a new era of significantly higher energy prices.

Copper prices continue to trade near record highs despite mounting signs of a slowing global economy and weakening industrial activity. As of early June 2026, investors still view copper as one of the key metals tied to the future of electrification, renewable energy, and artificial intelligence infrastructure.

Although broader economic data point to slower growth and weaker manufacturing activity, the connection between copper and the artificial intelligence sector has become a major driver of market sentiment. The debate is no longer whether AI will increase copper demand in the future, but whether markets have already priced in that expected demand too aggressively.

Natalie Scott-Gray, Senior Metals Analyst at StoneX, who has more than a decade of experience analyzing global metals markets, supply chains, and industrial commodity demand, believes that understanding copper’s recent price action requires examining the interaction between market fundamentals, investor behavior, geopolitical developments, and the growing influence of artificial intelligence.

Scott-Gray said copper prices have become increasingly sensitive to movements in US technology stocks, noting that the correlation between copper and technology equities has reached historically unprecedented levels. She added that any shift in investor sentiment toward artificial intelligence, earnings expectations, or technology company valuations can directly affect copper markets and amplify price volatility.

Despite the excitement surrounding artificial intelligence, Scott-Gray pointed out that actual copper demand generated by data centers and AI-related infrastructure remains relatively limited compared to what many investors assume.

She emphasized that demand linked to artificial intelligence and data centers currently accounts for less than 2% of total copper demand, highlighting a significant gap between market expectations and present-day consumption realities.

According to Scott-Gray, investors may be overestimating the speed at which AI-related demand will grow, creating the risk of price corrections whenever market enthusiasm becomes disconnected from underlying fundamentals.

Nevertheless, the long-term outlook for copper remains positive, supported by electrification trends and large-scale investments in infrastructure and energy systems. However, artificial intelligence alone has not yet become the primary driver of actual copper demand.

Scott-Gray warned that market sentiment has moved far ahead of reality, explaining that investors are increasingly linking the narrative of a future structural copper deficit with elevated expectations surrounding artificial intelligence, attracting additional speculative capital into the market.

She added that this dynamic is creating larger price swings and increasing sensitivity to daily news and developments, potentially opening the door to sharp corrections even while the long-term bullish trend remains supported by strong underlying fundamentals.

Bitcoin is standing at a critical crossroads after a sharp selloff pushed the digital asset back toward one of the most important support zones of the current market cycle, as investors continue to monitor developments in the Middle East and await signals from the Federal Reserve.

Bitcoin fell to $59,100 on June 5, a level that has historically served either as a major floor for previous declines or as a gateway to much deeper losses.

Federal Reserve meeting

Expectations increasingly point toward further monetary tightening by the Federal Reserve later this year. Analysts now anticipate that the Federal Open Market Committee could deliver two additional 25-basis-point rate hikes before year-end in response to higher energy prices and continued strength in the US labor market.

Even before the latest jobs report, investors had been raising their expectations for higher interest rates amid concerns that the energy crisis linked to the conflict with Iran could intensify inflationary pressures.

Weekly data released by US regulators showed that investors cut their bullish euro positions to the lowest level in three months during the week ended June 4, while bearish positions against the Japanese yen exceeded $10 billion, according to LSEG data.

The Federal Open Market Committee is scheduled to meet next week in its first gathering under Chair Kevin Warsh. Markets currently see roughly a 50% chance of a rate hike by September, a factor that analysts say could limit excessive dollar buying in the near term.

Strategists at Barclays noted that several upcoming developments, including shifts in risk sentiment, the possibility of a US-Iran agreement, and the upcoming Federal Reserve meeting, could place limits on further dollar strength in the short run.

Middle East developments

In a fresh development in the Middle East, Israel announced that it carried out strikes against military targets in western and central Iran on Monday, despite reports suggesting that US President Donald Trump had urged Israeli Prime Minister Benjamin Netanyahu to refrain from launching additional attacks.

The escalation pushed oil prices up by around 5%, adding to investor concerns at a time when markets were already facing a sharp correction in highly valued technology stocks.

At the time of writing, Bitcoin had recovered to $61,966. However, the rebound has not resolved the key question facing the market: is Bitcoin forming a major bottom, or is the current move merely a temporary pause before another leg lower?

The 200-week exponential moving average remains one of the most closely watched long-term indicators among Bitcoin traders. Analyst Michael van de Poppe noted that Bitcoin has formed major bottoms near this level in most previous bear-market cycles, with 2022 being the most notable exception.

According to analyst Dan Crypto Trades, the current decline ranks among the deepest pullbacks of its kind in Bitcoin’s history, making the present market structure particularly difficult to interpret. The current price zone is attractive enough to draw buyers, but the intensity of the selling pressure means a rapid recovery cannot be taken for granted.

The analyst added an important technical observation, noting that in previous instances where Bitcoin lost major support levels, prices typically accelerated lower and remained below those levels for extended periods.

This time, however, Bitcoin has managed to remain near its previous low, at least for now, opening the door to a different market structure. If buyers continue defending this area, Bitcoin could begin forming a broad trading range between approximately $60,000 and $80,000.

While such a range would not immediately confirm a bullish reversal, it would suggest that sellers are struggling to push the market into a deeper breakdown.

Oil prices surged by more than 4% on Monday after fresh Israeli strikes on Iran and renewed attacks in Lebanon undermined hopes that the broader regional conflict could soon come to an end.

During trading, Brent crude futures rose by $4.02, or 4.3%, to $97.11 per barrel by 09:14 GMT, while US West Texas Intermediate crude futures gained $3.90, or 4.3%, to reach $94.44 per barrel.

Middle East developments

Israel said on Monday that it had targeted the Mahshahr petrochemical complex in southwestern Iran, along with other military targets, despite reports indicating that US President Donald Trump had urged Israeli Prime Minister Benjamin Netanyahu to refrain from carrying out additional attacks.

Iran’s semi-official Fars News Agency quoted a local official as saying that parts of the facility had sustained damage.

Giovanni Staunovo, an analyst at UBS, said that the exchange of strikes between Iran and Israel is increasing market concerns that restrictions on shipping through the Strait of Hormuz could remain in place for a longer period, pushing oil prices higher.

Roughly one-fifth of global daily oil and liquefied natural gas supplies pass through the Strait of Hormuz off the coast of Iran.

Later on Monday, comments attributed to Iran’s ambassador to Moscow indicated that the strait would remain open, but under new conditions to be determined by Iran and Oman, including the imposition of transit fees.

Monday’s gains erased the losses oil prices suffered on Friday, when they fell on hopes that tensions between the United States and Iran might ease.

Since the outbreak of the conflict a little over 100 days ago, Brent crude has climbed 34%, while West Texas Intermediate has surged 41%. Brent prices had approached $120 per barrel in March.

On Sunday, Iran launched a new wave of missiles at Israeli targets in response to strikes carried out in Lebanon.

Despite the escalation, US President Donald Trump maintained that a broader agreement to end the conflict remains highly achievable.

Iran has made a ceasefire in Lebanon a condition for any peace agreement with Washington. Lebanon and Israel announced a ceasefire agreement on June 3 following negotiations held in Washington.

OPEC+

Amid the supply disruptions caused by the conflict, the OPEC+ alliance approved its fourth increase in oil production targets in four months on Sunday.

Analysts said the decision is unlikely to have a major impact because many alliance members are already unable to reach their production targets, either due to disruptions linked to the Strait of Hormuz closure or, in Russia’s case, because Ukrainian drone attacks have weakened production capacity.

Jorge Leon, Head of Geopolitical Analysis at Rystad Energy, said the practical impact of such a decision under current market conditions would be close to zero.

He added that refineries around the world have rushed to secure crude oil from any available source to replace the millions of barrels per day that are no longer flowing through the strait, noting that the world has lost more than one billion barrels of supply since the conflict began.