Mid-East tensions rise ahead of critical negotiations in Geneva

The story


Presidential push – US President Donald Trump said Iran wants to make a deal and added that he will be indirectly involved in today’s negotiations in Geneva. This is the second round of talks brokered by Oman. In the meantime, the Pentagon is deploying a second aircraft carrier to the region, while Tehran announced a military exercise near the Strait of Hormuz, the exit point from the Persian Gulf.

Why it matters


Higher chances of a deal – Most of the Iranian diaspora, with the largest community based in Los Angeles, is clamouring for the toppling of the Islamic Republic. However, I expect Trump to opt for an accord. Why? Merely announcing his involvement raises the chances for a breakthrough, as he is the ultimate decision-maker – ridiculed in markets for “chickening out,” at least when it comes to tariffs.

Moreover, a conflict would raise gasoline prices, which Americans are sensitive to, and put US soldiers at risk. It would be hard to repeat the success of Operation Midnight Hammer, in which American bombers hit Iranian nuclear facilities in June 2025. A deal would benefit Stocks while weighing on Gold and Oil.

What’s next


Lowering the scope is key – I do not expect a full agreement or a complete breakdown of talks. However, the agenda is critical. Iran wants to focus on its nuclear program and seems ready for concessions following the 12-day war and massive protests in January. The US, buoyed by Israel, desires to discuss Tehran’s ballistic missiles and its support for regional proxies. The narrower the scope, the higher the chances of a deal and the worse for Gold and Oil. A broader agenda would increase the risk of war and boost the prices of these commodities.