Tensions have flared up again as the US carried out overnight strikes on Iranian missile sites and mine-laying boats, prompting Tehran to accuse Washington of breaching the April 8 ceasefire and warn it’s ready to hit back. Iranian state media reported blasts near Bandar Abbas, while the Revolutionary Guards claimed they downed a US drone and fired at an F-35.
Despite the escalation, diplomacy hasn’t ground to a halt. Secretary of State Marco Rubio said a peace deal is still within reach, and Iran’s negotiators just wrapped up talks in Qatar, where they’re putting the finishing touches on a 14-point framework. President Pezeshkian told Qatar’s ruler his country is ready for a “respectful” end to the war, with demands including gradual release of $24 billion in frozen assets.
On the ground, Israeli strikes in Lebanon killed dozens more, adding pressure as Iran insists any final deal must cover its proxies. Partial internet restoration in Iran signals some easing of internal controls, but with the May 31 deadline fast approaching, these latest clashes have only widened the gaps among belligerents.
Trade analysis
The latest flare-up would send the odds for a peace deal by May 31 even lower as the ceasefire shows signs of cracking. The edge here is to sell into any short-lived YES spikes driven by optimistic comments and buy NO on the dips.
Bullish (YES) signals:
- Quick Iranian concessions during ongoing Qatar follow-ups
- External pressure from China or Qatar forcing rapid closure
Bearish (NO) signals:
- Further US or Israeli strikes without de-escalation
- Iran following through on retaliation threats
The structural barriers and short timeline make a deal by month-end feel increasingly out of reach. The base case stays on NO due to deep divisions persisting and violence picking up in Lebanon.