Brent Falls 7% as Trump Calls Off the Strike on Iran

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In Today's Note

• Brent fell as much as 7.3% to $81.55 in early Asian trade after Trump cancelled a planned strike on Iran and set talks for Monday, unwinding part of a 24% July rally. OPEC+ separately added 188,000 b/d for September, completing the unwind of its 2023 curbs.
• The SEC paused Nasdaq PHLX's cash-settled bitcoin index options while it weighs CME's jurisdictional challenge, and Michael Saylor signalled Strategy may resume buying after five weeks without a purchase. BTC trades near $62.5K, down 2% from Friday.

Market Snapshot: Overnight Moves

Macro & Markets

• Oil market volatility continues, with Brent crude falling as much as 7.3% in early Asian trade to $81.55 per barrel, while WTI dropped close to 6% to trade below $80.
• The move followed weekend reports that President Donald Trump had called off a planned military strike on Iran and that a fresh round of negotiations would begin on Monday.
• Trump told reporters aboard Air Force One on Sunday that he had cancelled the operation after allies in the Middle East, including Saudi Arabia, pressed him to pursue a deal, with Crown Prince Mohammed bin Salman reportedly acting as the primary intermediary.
• In a Truth Social post that followed, Trump wrote that any accord would have to deliver an "Immediate, Complete, and Total OPENING OF THE HORMUZ STRAIT" and bring an end to Iran's nuclear threat.

• Iranian state media has offered no indication that Iran either requested the pause or shifted its stance on the Strait of Hormuz, and Foreign Minister Abbas Araghchi warned counterparts in a series of calls on Saturday that Iran would meet any "adventurous action" from the United States in kind.
• This leaves the market exposed to re-escalation should Monday's talks fail to convene or produce, particularly given Brent had rallied roughly 24% in July, its strongest monthly performance since March, on the earlier flare-up in hostilities.

• The seven core OPEC+ producers, a group made up of the Organization of the Petroleum Exporting Countries and its allied non-OPEC oil-producing nations led by Russia, agreed on a video conference on Sunday to raise their collective crude output target by another 188,000 barrels per day for September.
• The step, led by Saudi Arabia and Russia, formally completes the theoretical unwind of the voluntary supply curbs first put in place in 2023, and gives the group scope to add further barrels once the Middle East war ends. Iraq, Kuwait, Kazakhstan, Algeria and Oman make up the remaining members of the group of seven.
• Delegates told Bloomberg the group currently expects to hold quotas steady for the remainder of 2026 after this September increase.
• Over the weekend President Trump said the US had "cancelled the attack" on Iran after Qatar, Saudi Arabia and the UAE pressed for a diplomatic resolution to the latest reescalation.
• Gold has held around $4,060, but ~2.5% lower over the month.

• US and Japanese officials disclosed the first intervention in the yen-dollar market in 15 years, confirming the move that was first flagged on Friday.
• Trump said aboard Air Force One that “they [Japan] wanted a little bit of help, and we’re always there for Japan.”
• Finance Minister Katayama and US Treasury Secretary Bessent confirmed the action, with the latter stating that the US Treasury “will not hesitate” to intervene in the market.
• USD/JPY has extended its rally to ~155-156, up roughly 5% from the 163.99 four-decade low struck on 23 Jul and stronger than the ~159 level we noted on Friday as BoJ data implies Japan sold around $59bn on Thursday alone.

• US equities closed slightly higher on Friday, with the S&P 500 and Nasdaq extending Thursday's rebound and finishing the week in positive territory, gaining 0.7% and 1.0% respectively.
• The Dow Jones Industrial Average also rose 0.53%, to 52,485.03 while the Cboe VIX fell 6.4% to 15.99.
• Over the past week, the S&P and Dow each gained close to 1% while the Nasdaq advanced 1.6%, recovering much of the losses from the mid-week selloff in AI-linked semiconductors.
• The monthly performance was more mixed. The S&P 500 ended July down 0.1% and the Nasdaq fell 3.2%, its first losing month of the year, while the Dow posted a 0.3% gain, marking a fourth consecutive monthly advance.

• Crypto prices have remained broadly sideways with BTC trading around $62,467, down roughly 2% from its Friday midday level of $63,736 and ETH also declining to $1,838, down around 2.4% from Friday.
• The moves come amid tighter financial conditions following last Wednesday's Fed hold, a decision at which three FOMC members dissented in favour of a rate hike, and Friday's continued move higher in long-end Treasury yields.

DeFi / Web3 / Altcoins / Crypto3

• South Korean crypto exchange Bithumb has officially targeted 2028 for its IPO, with plans to submit a preliminary listing review application in 2027, according to a notice posted on the website.
• The company will spend 2026 strengthening internal controls, improving risk management and transitioning from K-GAAP to K-IFRS accounting standards. It is also working with financial, legal and accounting advisers on valuation and regulatory preparations.
• The roadmap follows the postponement of an earlier 2025 listing target. Bithumb said the IPO is intended to increase transparency, strengthen customer trust and maximize corporate value.

• The SEC has paused Nasdaq PHLX’s proposed cash-settled bitcoin index options while reviewing a jurisdictional challenge from CME Group.
• CME argues that bitcoin is a commodity and that options linked directly to its price should fall exclusively under CFTC oversight. The SEC’s staff conditionally approved the Nasdaq proposal in May, but trading cannot begin without additional CFTC exemptions.
• The full Commission will now reconsider the decision, with supporting and opposing statements due by Aug. 24. The proposed QBTC options would track a bitcoin price index, settle in US dollars and be exercisable only at expiration.

• Kalshi and Polymarket recorded a combined $50.6B in July trading volume, setting a new monthly high as World Cup betting boosted prediction-market activity.
• Kalshi led with $37.7B, up 14% from June. Polymarket US surged 54% to $5B, while Polymarket’s offshore platform fell 26% to $7.9B.
• Combined open interest dropped from roughly $2B at the start of July to $1.2B by month-end following the conclusion of the tournament. Meanwhile, both platforms continue to face scrutiny from US state regulators over sports-related event contracts.

• Former US Rep. George Santos has agreed to pay $35,000 to settle CFTC allegations that he manipulated a Kalshi market tied to attendance at the 2026 State of the Union.
• The regulator said Santos used public statements about his attendance plans to influence contract prices, generating more than $17,500 in profit.
• Santos neither admitted nor denied the findings.
• The settlement includes the return of his profits, a cease-and-desist order and a three-year trading ban.
• His attorney denied any intent to mislead traders or manipulate the market.

• Strategy Executive Chairman Michael Saylor has hinted in his post on X that the company may resume buying bitcoin, posting “Bitcoin Drive engaged” alongside his regular Sunday BTC chart.
• Strategy has not disclosed a purchase in five weeks. Its latest filing showed holdings of 843,775 BTC, acquired for $63.69B at an average price of $75,476 per coin.
• With bitcoin trading near $62,200, Strategy’s position is worth approximately $52.5B.
• Saylor also confirmed that STRC’s annualized dividend rate will remain at 12% in August, based on its $100 stated amount.
• The preferred stock closed Friday at $89.46, implying a yield of roughly 13.4%.

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