Reports from Israel’s N12 News said Iranian Parliament speaker Mohammad Bagher Ghalibaf resigned from Iran’s negotiating team. The headline triggered risk aversion in Thursday’s US session, pushing crude oil prices sharply higher and supporting the US Dollar.
The report implied lower odds of a deal between the United States and Iran. Several Iranian journalists then denied the claim, including Mohammad Ghaderi on X, who said the report was false.
US President Donald Trump wrote on Truth Social: “I have all the time in the World, but Iran doesn’t — The clock is ticking!.” Earlier, he said: “Iran is having a very hard time figuring out who their leader is!”.
Iran’s President Masoud Pezeshkian responded by saying Iran has no hardliners or moderates, and described unity under the Supreme Leader. He added: “One God, one nation, one leader, one path; victory for Iran, dearer than life.”
In markets, uncertainty kept the US Dollar supported across foreign exchange. West Texas Intermediate held its intraday gains and traded at around $94.
We are seeing a familiar pattern of uncertainty building in the market, reminiscent of the events in 2025. Last year, we saw how a single, quickly denied headline about an Iranian negotiator sent West Texas Intermediate crude soaring towards $94 a barrel. That price spike showed just how sensitive energy markets are to any hint of escalating tensions between the US and Iran.
Given that similar rhetoric is now resurfacing ahead of planned talks in Vienna, traders should anticipate heightened volatility. The market is already on edge, with WTI currently trading around $88 a barrel. Recent statistics from the Energy Information Administration (EIA) confirm a surprise drawdown in crude inventories of 3.1 million barrels last week, leaving little buffer for any potential supply disruptions.
Therefore, buying near-term call options on crude oil futures offers a strategy with defined risk to profit from a potential price surge. This approach allows traders to capitalize on upward momentum if headlines turn negative, without exposing them to unlimited losses. We’ve seen a notable increase in open interest for the June $95 WTI call options, suggesting this sentiment is gaining traction.
Beyond energy, this geopolitical risk calls for defensive positioning in broader equity portfolios. We recommend hedging by purchasing put options on major indices like the S&P 500. The CBOE Volatility Index (VIX), often called the market’s “fear gauge,” has already crept up from a low of 14 to over 19 in the past two weeks, indicating growing anxiety among investors.
For those expecting a significant price move in oil but are uncertain of the direction, long strangles could be an effective strategy. This involves buying both an out-of-the-money call and an out-of-the-money put option, profiting from a large price swing either up or down. Implied volatility on WTI options has already increased to 42%, reflecting the market’s expectation of a sharp move following the Vienna meetings.
