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WikiFX Express

Trillions at Stake: Markets Brace for Landmark Supreme Court Tariff Ruling

Oil Volatility Spikes: Trump Threatens

WikiFX

| 4h

Abstract：Crude oil markets face renewed volatility as President Trump threatens a 25% secondary tariff on nations trading with Iran. The move has sparked record activity in oil call options as traders hedge against supply disruptions.

Global energy markets are bracing for potential supply shocks after President Trump escalated his “maximum pressure” campaign against Tehran. In a directive announced via social media, the President threatened a 25% tariff on any country conducting business with Iran, effective immediately.

“Maximum Pressure” 2.0

The diplomatic escalation comes at a fragile moment for the oil market.

The Threat: By targeting Iran's trading partners, the U.S. is effectively deploying secondary sanctions through tariffs, aiming to sever Tehran's economic lifelines.

Iran's Response: Iranian officials warned that any military aggression would result in a “lesson never to be forgotten,” placing U.S. assets and bases in the region on high alert.

Market Reaction: Panic Buying in Options

While spot crude prices saw a moderate lift, the derivatives market revealed deeper anxiety.

Record Call Volume: Brent Crude call options volume hit a record high on Monday, with over 550,000 contracts changing hands.

Skew Flip: The options skew has flipped bullish, indicating that traders are now paying a premium to protect against an upside price spike—a sharp reversal from the bearish “oversupply” narrative that dominated early January.

WTI & Brent: Prices for WTI and Brent have climbed, supported by the risk that these tariffs could tighten global supply by alienating buyers of Iranian oil, or trigger a kinetic conflict in the Persian Gulf.

For forex traders, this dynamic creates a complex feedback loop. Higher oil prices typically support the CAD but could complicate the inflation outlook for oil-importing nations like Japan and the Eurozone, potentially weighing on JPY and EUR against the Petro-currencies.

Disclaimer:

The views in this article only represent the author's personal views, and do not constitute investment advice on this platform. This platform does not guarantee the accuracy, completeness and timeliness of the information in the article, and will not be liable for any loss caused by the use of or reliance on the information in the article.

WikiFX Express

Trillions at Stake: Markets Brace for Landmark Supreme Court Tariff Ruling

Gold

Oil Volatility Spikes: Trump Threatens

“Maximum Pressure” 2.0

Market Reaction: Panic Buying in Options

Trillions at Stake: Markets Brace for Landmark Supreme Court Tariff Ruling

Gold

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