Speaking to ET Now, Peter McGuire, CEO, Australia-Trading.com captured the fluidity of the current environment, where sentiment is turning as quickly as headlines.
“I tell you what, a lot changes, does not it, of a couple of statements and it is a two-week freeze. Have a look, 16% down for WTI. I am just inhaling it all. Equities are having a boom of a day across Asia. It is very hard to say are we at that point that there is no return and everything returns to normal. What is normal? How does it look? What does it smell like, taste like, and how is it going to unpack? So, at the moment I have got to be bearish for crude. Yesterday, I was bullish because I did not think they would come to a deal. But things change very quickly. And when you are looking at commodities like this, it is just an enormous sell-off.”
The sharp fall in crude—driven by a temporary ceasefire—has injected fresh momentum into equities, particularly across Asia. Markets from South Korea to Japan and Taiwan have surged, reflecting a swift return of risk appetite.
Yet, the central question remains: can this calm last?
McGuire believes the next two weeks will be critical in shaping the trajectory of oil prices and broader market sentiment.“Well, a couple of things. First off, yes, I have got to give it a two-week time frame and I have got to say if nothing happens in that point in time and there is a total ceasefire, I would expect energy prices to soften from here. And if there is, and that is what we have got to hope and assume and pray for, that there are no attacks and everything just is what the letter of the law says. So, we work through the next two weeks. We look at softness across the complex as far as price, shipping returns, and things start to take a more active stance. If that is how it rolls, then that is a good sign. But if there are any hiccups or anything unknown, that changes the whole geopolitical footprint as we know. So, let us just hope and pray that things move in the correct angle, and time will tell.”Even in a best-case scenario, however, the path to normalcy is unlikely to be smooth. The global energy ecosystem has already absorbed shocks—from supply disruptions to logistical bottlenecks—and rebuilding confidence will take time.
“Absolutely. I mean, that is so true. You do not just turn a key and say, right, oh, well, here is the key, go and turn the engine and everything goes back to normal, that is not how it is going to happen. We understand that there are issues as far as LNG coming from Qatar. We all understand that there are issues as far as production, how the fertiliser industry moves, what happens as far as any other choke points. So, there are many different components of this that have got to be worked through and time is going to be the saviour. So, if this is the end of this whole conflict, then we put it to bed and say yes, it was a six-week conflict and then it just takes a normal stance and it returns to a new form of normal, but there is still a lot of water to pass under the bridge until that is actually the status quo.”
For investors, the immediate takeaway has been a decisive shift back toward risk assets. Equity markets are rallying, bond yields are softening, and the US dollar has come under pressure—classic indicators of a “risk-on” environment.
“Well, you know as well. Have a look at the screen now, 6% up for KOSDAQ in South Korea. Nikkei 225 up 5%. Australia is up 2.6. China is up 2.4. Taiwan 4.3. There is a return to risk on and it is going to be very interesting to see what you guys do today. I am keeping a very close eye on the Nifty, Sensex and how all of that works. So, at the moment it is going to be back on as far as risk. US dollar came under pressure. It is now under 99. Bond yields have eased a little bit, back at 4.25 for a 10-year, 3.73 for 2-year. So, I am seeing a softness across the bond yield, softer dollar, and I would say risk on.”
As markets digest the latest developments, one thing is clear that while sentiment has turned positive for now, the road ahead remains highly dependent on geopolitics. The ceasefire may have bought time—but whether it delivers lasting stability is a question only time can answer.
-1024x683.jpg "Strait Outta Hormuz: Getting the Iran Oil Story Straight")
-1024x683.jpg "Iran Determined to Scupper Its Own Security")
