Oil, gold, and stocks wobbled on the lingering war of attrition between the US and Iran
· Although the Iran war may be over, the Strait of
Hormuz uncertainty remains, and elevated oil is a headache for Trump ahead of
the Nov. 26 midterm elections.
· Trump is desperately looking for a face-saving exit
from his Iran war ‘fun’ (mess), and thus he is bound to blink first.
· Iran may not agree to transfer the ‘nuclear dust’
to any 3rd country, including China.
As of May 25, 2026, the US and Iran continue to
engage in a war of attrition—a high-stakes diplomatic effort for permanent
peace and the full reopening of the Strait of Hormuz (SOH). So far, marathon indirect
negotiations, mediated primarily by Pakistan and supported by Qatar and Oman,
have produced a draft framework agreement—often referred to as a Memorandum of
Understanding (MOU)—aimed at immediate de-escalation. However, fresh US
military strikes, hardline resistance in Tehran, and irreconcilable positions
on Iran’s nuclear program continue to cloud prospects for a swift resolution.
US President Trump and Secretary of State Rubio
have adopted a dual-track strategy: maintaining maximum military and economic
pressure while expressing cautious optimism about reaching a “good deal." As
per reports, Trump may be under pressure from his MAGA/Republican hardliners
(foreign policy hawks) for any undue concessions to Iran. On the other side,
Iran insists on economic relief and sovereignty guarantees before making
meaningful nuclear concessions. As per the report, Iran may agree to transfer
the so-called 'nuclear dust' (highly enriched uranium, HEU) to its reliable
partner China (as a third party) instead of a Chinese guarantee that the US
will not break any potential nuclear deal in the future (like the JCPOA, broken
in 2015 and 2017 by Trump).
Background
of the 2026 Iran Conflict
The current crisis escalated dramatically when the
US and Israeli forces launched extensive strikes on Iranian nuclear facilities,
missile sites, and military infrastructure in late February 2026. Iran also
responded quite asymmetrically and above expectations with its barrage of
missiles and drones. The US and Israel are now reportedly short of interceptor
missiles. Iran also responded by disrupting shipping through the Strait of
Hormuz—a critical chokepoint that carries approximately 20% of global oil &
gas trade—and by activating regional proxy networks. A fragile
Pakistan-brokered ceasefire took hold in early April and has been repeatedly
extended, though sporadic clashes, including US strikes on May 25–26 near
Bandar Abbas and Larak Island, highlight its precarious nature.
The human and economic toll has been significant.
Iran reports over 1,500 schools damaged, widespread infrastructure destruction,
and severe economic strain, with workers struggling amid soaring food prices.
The internet blackout, now entering its 87th day, has further isolated the
country. But now it may be withdrawn. The US suffered the loss of 13 marines
(soldiers), while Israel also suffered a heavy bombardment of Iranian missiles
& drones, along with other GCC countries having active US military bases.
Overall, GCC countries are now seeking permanent peace rather than Trump’s
‘Iran excursion for fun.'
Current
Status of Negotiations
Talks are proceeding indirectly through multiple
channels. High-level Iranian delegations, including Parliament Speaker Ghalibaf
and Foreign Minister Araghchi, have been meeting in Doha, Qatar. Pakistan
continues to serve as the primary mediator, while Oman is involved in
discussions regarding Hormuz navigation.
According
to multiple reports, the two sides are negotiating a short-term framework MOU
that would:
· Establish
an immediate and comprehensive ceasefire across all fronts, including Lebanon.
· Reopen
the Strait of Hormuz under a joint Iranian-Omani management model with
guaranteed freedom of navigation.
·
Lift
the US naval blockade in exchange for Iran clearing mines and ensuring safe
passage (by July '26).
·
Provide
phased or temporary sanctions relief and partial release of frozen Iranian
assets (Iran is reportedly demanding $12 billion upfront from funds held in
Qatar).
· The
nuclear file—particularly Iran’s stockpile of HEUs—is largely deferred to a
follow-on 60-day negotiation period.
· The
current ceasefire will be extended by another 60 days.
This sequencing reflects a pragmatic attempt to stabilize
the immediate crisis before tackling the most contentious issues.
Trump's
and Rubio’s Latest Positions
President Trump has been unequivocal on the core
demand that Iran must not have a nuke under any circumstances. Although
previously he was open to the idea that Iran may transfer the HEU to China (as
a neutral responsible superpower), he is now saying Iran’s HEUs must be surrendered
to the US for destruction or eliminated under international supervision,
describing it as “nuclear dust". He has stressed that negotiations are
“proceeding nicely” but warned that the US blockade will remain in place until
a deal is signed. Trump has repeatedly stated he seeks a “great and meaningful
deal”—the opposite of the 2015 JCPOA—or no deal at all.
Trump’s
latest posts on Truth on Iran
· The enriched uranium (nuclear dust!) will either be
immediately turned over to the United States to be brought home and destroyed
or, preferably, in conjunction and coordination with the Islamic Republic of
Iran, destroyed in place or, at another acceptable location, with the Atomic
Energy Commission, or its equivalent, being witness to this process and event.
Thank you for your attention to this matter! President DJT
·
Negotiations with the Islamic Republic of Iran are
proceeding nicely! It will only be a great deal for all or no deal at all—back
to the battlefront and shooting, but bigger and stronger than ever before—and
nobody wants that! During my discussions on Saturday with President Mohammed
bin Salman Al Saud of Saudi Arabia, Mohammed bin Zayed Al Nahyan of the United
Arab Emirates, Emir Tamim bin Hamad bin Khalifa Al Thani, Prime Minister
Mohammed bin Abdulrahman bin Jassim bin Jaber Al Thani, and Minister Ali al-Thawadi
of Qatar; Field Marshal Syed Asim Munir Ahmed Shah of Pakistan; President Recep
Tayyip Erdoğan of Türkiye; President Abdel Fattah El-Sisi of Egypt; King
Abdullah II of Jordan; and King Hamad bin Isa Al Khalifa of Bahrain----
· I stated that, after all the work done by the
United States to try to pull this very complex puzzle together, it should be
mandatory that all of these countries, at a minimum, simultaneously sign onto
the Abraham Accords. Those countries discussed are Saudi Arabia, the United
Arab Emirates (already a member!), Qatar, Pakistan, Türkiye, Egypt, Jordan, and
Bahrain (already a member!). It may be possible that one or two have a reason
for not doing so, and that will be accepted, but most should be ready, willing,
and able to make this settlement with Iran a far more historic event than it
would otherwise be.
· The Abraham Accords have proven to be, for the countries
involved (the United Arab Emirates, Bahrain, Morocco, Sudan, and Kazakhstan), a
financial, economic, and social BOOM, even during this time of conflict and war,
with the current members never even suggesting leaving or taking so much as
even a pause. The reason for this is that the Abraham Accords have been great
for them and will be even better for everybody and bring true power, strength,
and peace to the Middle East for the first time in 5,000 years. It will be a document
respected like no other that has ever been signed, anywhere in the world. Its
level of importance and prestige will be unparalleled! It should start with the
immediate signing by Saudi Arabia and Qatar, and everybody else should follow
suit. If they don’t, they should not be
part of this deal, as it shows bad intentions.
·
In speaking to numerous of the Great Leaders
mentioned above, they would be honored, as soon as our document is signed, to
have the Islamic Republic of Iran as part of the Abraham Accords. Wow, now that
would be something special! This will be the most important deal that any of
these great but always-in-conflict countries will ever sign. Nothing in the
past, or in the future, will surpass it. Therefore, I am mandatorily requesting
that all countries immediately sign the Abraham Accords, and that, if Iran
signs its agreement with me, as president of the United States of America, it
would be an honor to have them also be part of this unparalleled world
coalition. The Middle East would be united, powerful, and economically strong,
like perhaps no other area anywhere in the world! By copy of this TRUTH, I am
asking my representatives to begin and complete the process of signing these countries
into the already historic Abraham Accords. Thank you for your attention to this
matter! DONALD J. TRUMP, PRESIDENT OF THE UNITED STATES OF AMERICA
Trump’s post is both
optimistic about current diplomacy and maximalist in its ambitions. He is
attempting to transform a bilateral US-Iran de-escalation agreement into a
historic multilateral Middle East realignment through an extended Abraham
Accords—a series of historic peace and normalization agreements signed in 2020
between Israel and several Arab/Muslim countries, brokered by the US under
President Trump 1.0. Existing countries in the Trump-led Abraham Accords are
the UAE, Bahrain, Sudan, and Morocco, while Kosovo and others showed interest.
Trump is now pushing for a
major expansion of the Abraham Accords. He wants Saudi Arabia, Qatar, Egypt,
Jordan, Pakistan, Turkey, and potentially even Iran to join as part of any
US-Iran deal, aiming to create a broad regional peace and economic bloc (United
States of the Middle East) ─ under US control.
In a written statement released on Tuesday (May 26) for the Hajj
pilgrimage, Mojtaba Khamenei—who has not appeared publicly on camera since becoming Supreme Leader—delivered a strongly ideological message:
·
Called
for the creation of a “post-American order” in the Middle East.
· Stated
that regional countries will no longer serve as a “shield” for US military
bases, and the US will no longer have a “haven” in the region.
· Praised
the “Axis of Resistance” (including Lebanese Hezbollah) for teaching a lesson
to the US and Israel.
· Repeatedly
described Israel as a “cancerous tumor" and an “unstable Zionist regime,"
claiming it is in its “final stages” and “will not exist in the next 15 years."
· Invited
Islamic countries to friendship and cooperation for a new regional order based
on “sincerity and purity."
This is one of his most
significant public messages since taking power.
This hardline message introduces new tension into the ongoing talks:
· Contradicts
Trump’s Vision: While Trump is pushing for a grand regional deal, including
expansion of the Abraham Accords and possible Iranian participation, Khamenei
is promoting an explicitly anti-American and anti-Israel regional order.
· Signaling to Hardliners: The message appears aimed at reassuring Iran’s hardline base and
the IRGC that the Supreme Leader is not softening on core ideological
principles despite the negotiations.
·
Negotiating
Dynamics:
o It strengthens the hand of Iranian hardliners who
oppose major concessions.
However, it does not necessarily kill the current
framework talks, which are focused on immediate de-escalation (Hormuz
reopening, ceasefire, asset release) rather than long-term strategic alignment.
Despite Khamenei’s rhetoric:
·
Indirect
negotiations continue via Pakistan and Qatar.
· Both
sides are still negotiating the wording of a short-term framework MOU.
· Trump
described talks as “proceeding nicely” earlier today and is pushing for a
broader Abraham Accords expansion.
· Rubio
reiterated that the Strait of Hormuz “will be open one way or the other.”
Key
Reality:
In Iran’s system, the Supreme Leader has the final
say. His message suggests he is willing to accept a limited tactical deal for
economic relief and breathing room while maintaining long-term ideological
goals (expelling US influence and confronting Israel). Khamenei’s statement is
tough and ideological, designed to project strength and leadership continuity.
It highlights the deep gap between the two sides’ long-term visions:
· US/Trump:
Wants a transformative regional realignment (Abraham Accords expansion,
possible Iran inclusion).
· Iran/Khamenei
wants a no-American Middle East with continued resistance against Israel and US
presence.
· This
makes a comprehensive grand bargain very difficult, but a limited framework
agreement on immediate issues (Hormuz, ceasefire, and sanctions relief) still
appears possible in the coming days.
Rubio’s
Latest Positions
Secretary of State Rubio, speaking in Jaipur, India,
on May 26, delivered some of the strongest language yet on the Strait of Hormuz:
· The
straits have to be open. They’re going to be open one way or the other.
· Iran’s
restrictions are “unlawful, illegal, unsustainable, and unacceptable.”
· Talks
on specific language in the draft document continue and could take “a few days”
to finalize, while emphasizing Trump’s commitment to either a strong agreement
or none at all.
· Despite
fresh US strikes, Rubio maintained that diplomacy remains viable.
Major
Sticking Points: US-Iran potential deal
· Nuclear Program and HEUs: The US insists on verifiable disposal of Iran’s HEUs
stockpile as a prerequisite for major sanctions relief. Iran rejects including
nuclear concessions in the initial MOU, preferring to address the issue only
during the 60-day follow-on talks. Some Iranian sources have floated the
possibility of shipping the material to China under guarantees, but this
remains highly contentious.
·
Strait of Hormuz Management: While both sides agree the strait must reopen,
disagreements persist over management, potential transit fees, and the role of
US and allied vessels. Rubio’s “one way or the other” remark underscores
Washington’s determination to restore full commercial access.
·
Economic Relief vs. Compliance: Iran is pushing for the immediate release of frozen
assets and temporary sanctions waivers. The US favors a strict “relief for
performance” model, tying concessions to verifiable Iranian actions.
Regional
De-escalation: The draft
reportedly includes commitments to end hostilities on all fronts, including
Israel-Hezbollah fighting in Lebanon. Israel has expressed deep skepticism,
fearing any deal would allow Iran breathing room to rebuild.
Internal
Iranian Politics: President Pezeshkian
is navigating significant hardline opposition. Outlets like Kayhan and
IRGC-linked media have urged halting talks, while some MPs demand guarantees on
sovereignty and reparations. Supreme Leader Mojtaba Khamenei’s approval remains
essential for any final deal.
Regional
and Global Implications
A successful framework agreement would have
far-reaching effects. Reopening the Strait of Hormuz could quickly ease global
oil prices, which have swung dramatically in recent weeks. Markets have shown
sensitivity to negotiation headlines, with oil tumbling on optimism and
rebounding after strikes. For the broader Middle East, a deal could pave the
way for wider de-escalation and potentially expand the Abraham Accords, as
Trump has suggested. However, failure could trigger renewed large-scale
conflict, with Trump warning of actions “bigger and stronger than ever before.”
China, Russia, and European powers are closely watching developments. Beijing
has praised Pakistan’s mediation role, while European leaders have emphasised
the need for unrestricted Hormuz navigation and the prevention of an Iranian
nuclear breakout.
Conclusions
Trump is now desperate for an immediate face-saving exit from his Iran
war mess ahead of the Nov. 26 midterm election, which he is set to lose badly
in any way. Trump’s popularity is steadily declining due to his chaotic
policies and the now-soaring cost of living as a result of surging gasoline
(oil) prices due to the lingering double blockade of the SOH and Iran war. The
question now is whether Iran will transfer its highly enriched uranium to China—or any third country (like Russia)—and sign a peace MOU with the Trump administration; the answer remains unanswered as of now. While Iran has floated a
compromise involving partial down-blending and third-country transfer (with
China as a leading candidate), significant gaps persist on verification,
guarantees, enrichment rights, and facility status.
Trump
is demanding a 20-year nuclear enrichment ban for Iran, while Iran is offering a
5-year ban. Although Iran and the US may agree on a 10-year nuclear enrichment
ban (middle ground), Iran may not compromise with its missile programs and
the SOH leverage. It will ensure joint
ownership along with Oman for the SOH toll tax system for the reconstruction
effort. But Trump may not be in a position to accept such concessions for Iran,
as it may further damage his political prospects ahead of the November 26 midterm election, which Trump is set to lose badly. As long as Iran fully agrees to hand over the HEUs and open the SOH
fully, Trump may maintain the US naval blockade of the SOH, including Iranian
ports. Although an MOU may be signed soon, the signing of the full deal may
take more time till July-August '26. The Iran war uncertainty may not be over
with the mere signing of the MOU.
Bottom line
The Iran war may be over, but the Strait of Hormuz double blockade may
not be over, and it may take at least July-August to be fully operational
normally, as Iran has to remove undersea mines throughout June-July. Thus, oil
may not fall much till at least August-September or even November, and Trump
may face heavy defeats in the forthcoming midterm election (November 26). In
that scenario, die-hard Trump may launch a surgical strike on Iran’s nuclear
facility to bring out ‘nuclear dust’ and announce a unilateral victory over
Iran.
Technical
outlook: DJ-30, NQ-100
Looking
ahead, whatever the narrative, technically the Dow Future (CMP: 50950) now has to sustain over 50700 for a
further rally to 51000-51700* in the coming days; otherwise, if it sustains below
50500/50200-50000/49500, DJ-30 may fall to 48500/48000-47600/46600 and 46000/45700*-45200*/45000
and 43800/43000-42000/39000-36800 in the coming days.
Similarly,
NQ-100 Future (29900) now
has to sustain over 30100 for a further rally to 30500-31000 in the coming
days; otherwise, if it sustains below 30000/29500-29100/28500*-28100/27800, it may
fall to 27400-27000 and 26600/26300-26000/25600; NQ-100 may again fall to
24600/24400-24000/23900, and further to 23600/23300-22800/22400 and 21900-21000
in the coming days.
Looking
at the chart, technically SPX-500 (CMP: 7550) now has to sustain over 7700 for a further rally to
8000-8300 in the coming days; otherwise, sustaining below 7550/7500-7300/7200
and 7100-6900, it may fall to 6835/6700 and further to 6600-6500/6450 and
6350/6300-6250/6180 and 5860-4800 in the coming days.
Looking
at the chart, technically Gold (XAUUSD) ─ CMP 4515, now has to sustain over 4490 for any recovery towards 4550/4600-4680-4700*
and only sustaining above 4700-4720, may scale 4750/4800-4850/4900 and
4975*/5000-5515/5555-5575* in the coming days. On the flip side, if it stays below 4490, it may further fall to 4475/50-4600*/4590-4550/4500* and further
4450/4390*-42135/4100* and 4000-3950 in the coming days.
Looking
ahead, whatever the narrative, technically Oil (CMP: 92) now has to sustain over 80/87-112/115
for a further rally to 121/125-130/155 and even 185-200 in the coming days
(best to bubble case scenario – if the Iran war escalates further into a major global
war or the SOH blockade lingers further). On the flip side, if oil sustains
below 112/110-105/98, it may again fall to 94/90-84/80* and 70/67-64/60 and
54/50 in the coming days.
