Good morning! Trump is reportedly being briefed on Iran attack options as the crisis continues to worsen every day. One of the possibilities includes something called a "final blow" as economic problems ramp up.

Weekends are historically escalation time and as Trump's visit to China approaches, this might be the best weekend to try and escalate to deescalate, so let's look at the markets to see how they see the events in the next 72h.

Iran Tracker

#1 Peace

Interestingly, as the escalatory rhetoric intensifies, chances of a permanent peace deal increased to 36%.

While we are still well below last week's levels, Trump is known to intensify his threats as negotiations are nearing the end. However, outside of that there is nothing to indicate that the two sides might be getting closer to a deal as no official meetings are taking place.

And outside of the slight rise due to the deadline on war powers act, the end of military operation by end of June remains flat on the week, indicating little progress was made:

#2 The Strait Of Hormuz

The Strait of Hormuz remains effectively closed with chances of its opening reaching its lowest level yet on the end of May market.

The escalatory rhetoric doesn't help as we enter the third month of the closure. And with the last pre-war shipments of oil from the strait already reaching destinations, we can expect May to be the first month with massive visible effects to the global economy.

Energy markets started to react accordingly with all oil benchmarks well above $100 per barrel:

#3 Boots On The Ground

Invasion chances ended flat on the week at 34%, despite the escalatory rhetoric.

All options presented to Trump included strikes rather than a proper invasion, keeping the market subdued. But even then, a lack of a larger move indicates that strikes are far from being certain.

#4 Regional Expansion

Chances of a regional expansion of the conflict also remain flat.

With lack of renewed strikes market, this is the clearest indication that the resumption of war is not considered as very likely. The upcoming China visit as well as FIFA World Cup might prevent Trump from a kinetic escalation in favor of an increased economic pressure.

#5 Iran Regime Fall

Similarly to above markets, the Iran regime fall chances are also flat.

Resilient.

Wrap up

The no war, but no peace scenario is here. Additionally we now have a war rhetoric putting further pressure on the regime and giving market s a new narrative to trade.

That being said, pretty soon we will start to see the effects of the double blockade globally and prediction markets offer the better window into the global situation in the coming months.

Starting Monday, we will move to more general reporting on the briefs, but Iran war will still have a place in the daily pieces as the most important global event.

Make sure to follow prediction markets live to get fresh information on the conflict. Stay strong and see you on Monday for another Morning Brief!

This is not official investment or life advice. Do your own research. This are only my opinions and I encourage anyone to do their own research before putting any money anywhere.