Will there be a fight? The answer is hidden in oil prices and the capital markets

If you don’t know whether the situation will escalate, you can actually look at two “more honest-than-people” indicators: oil prices and the market.
Once the market truly expects the conflict to escalate, Crude Oil will surge rapidly, while risk assets will drop in sync. But if it’s only “escalation in words,” the market usually shows choppy trading rather than a one-way move.
From the looks of it, this is more like an “expectations battle” than a “real escalation.”
Next, look at both sides’ motivations: a full-scale conflict means uncontrollable risk, while limited standoffs can continue to manufacture bargaining chips.
So the more likely outcome is: the situation stays under high pressure, but is prevented from going truly out of control.
— In one sentence: if they really were going to fight, the market would have shown you first.
#美伊二轮谈判进展