Trump's Rejection of Iran's Offer Sparks Oil Price Surge, Market Fears

Oil prices surged significantly after U.S. President Donald Trump rejected an Iranian offer that included reopening the Strait of Hormuz and returning to nuclear negotiations. Brent crude rose approximately 2.5% to $107 per barrel, while West Texas Intermediate increased by about 2% to nearly $94, according to accountant Majd Karam.

Karam explained that Iranian Foreign Minister Abbas Araghchi had proposed a deal involving Iran's readiness to reopen the Strait of Hormuz and resume nuclear talks within seven days, contingent on conditions like halting hostilities, lifting the naval blockade, and ending the economic war. Trump's brief rejection of this offer, as relayed by Karam during a radio interview, immediately impacted oil prices.

In parallel, Karam discussed economic developments between the U.S. and China, noting a plan to reduce tariffs on $30 billion worth of imports for each country. He characterized this as an effort to de-escalate trade tensions between the world's two largest economies following a meeting between their presidents. The impact of U.S.-China relations extends beyond these two nations, affecting the global economy, stock markets, the dollar, commodity prices, and long-term living costs.

Karam also warned of concerning signs beneath the surface of the U.S. stock market, despite its apparent stability. He pointed to a 33% rise in the U.S. Treasury bond market volatility index over two days, indicating increased uncertainty regarding interest rates, inflation, and the U.S. economy. The financial sector's XLF index also dropped over 2% in a week, with a sharp decline on a specific day. Karam suggested that the combination of rising bond volatility and weakening financial stocks warrants close observation.

He cautioned that continued uncertainty could lead investors to reduce their exposure to high-risk assets, seeking safer havens. Karam warned that a sharp stock market downturn could trigger a "domino effect," impacting other economies. Finally, Karam mentioned expectations of a 25 to 40 agorah increase in gasoline prices per liter starting next month, bringing the price to between 8 and 15 shekels, noting these figures are still within projections and influenced by various factors.