On Thursday, when the conflict between the US and Iran entered its 153rd day, widening war pulls in more countries since Wednesday, when A fire that broke out on two vessels, including one US-owned, at an Egyptian port on Wednesday was caused by a drone, Cairo confirmed, marking the first time Egyptian infrastructure has been struck. Also on Wednesday, Saudi Arabia struck Iranian proxies in Iraq, after months of resisting being pulled into the conflict.
The US military launched a “heavy wave of strikes” against Iran in retaliation for Iran’s attempted attack on US military positions on Tuesday. The latest strikes were the first in several days to directly target the country.
Now, the conflict is expanding, with Egypt and Saudi Arabia becoming increasingly drawn into regional hostilities.
Egypt is now directly impacted by the conflict after its infrastructure was struck for the first time, causing a fire to break out on two vessels at one of its ports. It comes as Saudi Arabia has also been pulled further into the war, carrying out joint strikes with the US on Iranian proxies in Iraq.
On Thursday, the Kuwaiti army said Iran conducted a deadly strike on a building belonging to a Chinese company in the northern part of the country, killing one employee and causing “extensive material damage” to the structure.
Meanwhile, the IRGC said the Strait of Hormuz will remain closed as long as US “threats” and “interference” with shipping in the region continue.
However, reported Thursday that its latest quarterly profits soared to their second-highest levels in the company’s history, as the US-Iran war has surged in global oil prices.
The price of , the global oil benchmark, has soared by nearly a third since the start of the war in February.
On the most tangible economic fallout of the conflict in Iran, 74% of Americans say rising gas prices have caused them at least some hardship, up from 63% in March, with just under one-quarter believing the president has a plan to address the issue. And 71% say Trump hasn’t gone far enough in trying to reduce the price of everyday goods, up from 58% a year ago.
At the time of Trump’s second inauguration, nearly half of Americans thought it was at least somewhat likely that Trump would avoid conflicts between his family’s company and his work as president, but a scant 23% think he’s done so at least somewhat well. And 57% say it’s a bad thing that Trump earned more than $2 billion last year while serving as an elected official, including income from cryptocurrency holdings, royalty payments and property investments. Just 7% see that as a good thing, with 36% calling his earnings while president something that doesn’t matter much.
Undoubtedly, despite renewed US strikes on Wednesday, following President Donald Trump’s f-bomb warning that Iran is due another “beating,” he has yet to show he can blast Tehran back to talks.
But diplomacy that he hailed as bringing historic peace to the Middle East also failed when a vaguely worded Memorandum of Understanding collapsed.
And his options for changing the equation — risking the lives of hundreds of US troops in a ground war or recognizing Tehran’s control of the Strait of Hormuz — are so unpalatable that the phrase “no good options” has become a cliché.
I find that, like with many conflict situations, the eventual framework needed to quell fighting and open the way for talks on the most fundamental issues, like Iran’s nuclear program, is possible to visualize.
Here, it might involve a compromise wherein the United States could avoid admitting it suffered a strategic defeat through Iran’s effective control of the strait, and Iran could argue it preserved its main takeaway from a war that ravaged its leaders and military.
Undoubtedly, the costs of the Iran war are not confined to the participants. The political and economic backlash is mounting in the Middle East and Europe — escalating pressure on outside parties to try to jolt diplomacy into life.
If the strait remains a no-go zone for most civilian ships, grave reverberations from the war will worsen, as global oil reserves erode, while oil-based products like diesel and fertilizer spike, and a potentially looming liquid natural gas shortage in Europe this winter.
The emergence of Gulf states as luxury tourist and expatriate havens has been shattered by the war. Weakened European governments are being punished by war-related cost-of-living hikes.
I find that Trump’s return to attacking Iran means meaningful diplomacy will remain on hold. And even a deal to stabilize the strait would only address a new crisis thrown up by the war while not come near meeting US concerns over Iran’s nuclear and missile programs.
I find that the main driver of US action is now Trump’s volatile personality — not a conventional view of national interests. Anything can happen at any moment.
So, predicting a directional move by the in short term, looks extremely difficult, as the gold changes direction with changing tone of the US President Donald Trump, who changes his stance on Iran, especially on weekends, and turn the prevailing sentiments with a statement on Mondays or Tuesdays.
Undoubtedly, he himself is worried about his declining popularity among US citizens. At the same time, mid-term elections are in November, just a few months away. Now, if he wants to defend his popularity, he could take a slightly softer step to resolve this conflict with Iran at the earliest point.
Otherwise, the conflict could widen beyond his control, as the involvement of other countries at this time could elevate the energy-driven inflationary pressure to an extensive level, where stagnant growth due to surging inflation could push the whole world into a scarier scenario.
I have already discussed the technical levels for gold futures on different time chart patterns in my previous analysis, Gold: Fed Hold Shifts Focus to PCE Inflation Data.
I conclude that despite the wobbly moves by gold futures in a narrow range on Wednesday and Thursday, it will be interesting to see this week’s closing levels, as this week’s closing will also be the closing of this month.
For a short-term outlook, I prefer to analyse the movements of the gold futures on the 1-Hr. chart, and now I find that gold futures are facing significant resistance above $4,108.92 and could pierce yesterday’s low before today’s close, despite persisting bullish engulfing below this resistance. Undoubtedly, the last six candles on an hourly chart could be decisive.
