Most Asian equity indices fell on Monday after US\u2013Iran peace talks ended without an agreement, and President Donald Trump said the US military will enforce a blockade in the Strait of Hormuz. Japan\u2019s Nikkei 225 fell 0.8%, South Korea\u2019s KOSPI dropped 0.85%, and Hong Kong\u2019s Hang Seng slid 1.16%, while China\u2019s Shanghai Composite was almost flat.<\/p>\n
European stock futures were mixed, and US futures pointed to a lower open on Wall Street. Oil prices rose again after Trump said the US would block all vessels from Iran from 10:00 Eastern time (14:00 GMT) on Monday, with the move aimed at pressuring China, the main buyer of Iranian oil.<\/p>\n
Trump said he did not care if Iran returns to talks, while a two-week ceasefire that began last Wednesday remains in place. This reduced further falls in equities.<\/p>\n
Iranian authorities said a Strait of Hormuz blockade would breach the ceasefire, and the Revolutionary Guard said military vessels approaching the area would be \u201cdealt with severely\u201d. With a light economic calendar on Monday, Middle East updates are expected to drive markets.<\/p>\n
We remember the market reaction in 2025 when the US-Iran peace talks collapsed and the Strait of Hormuz blockade was enforced. That event sent a shockwave through equity markets and caused a significant spike in oil prices. The subsequent weeks were defined by extreme volatility as markets priced in the risk of a wider conflict.<\/p>\n
The blockade last year pushed Brent crude prices past $110 a barrel by the summer of 2025, feeding a surge in global inflation that central banks are still battling today. We saw the CBOE Volatility Index (VIX) consistently trade above 30 during that period, a stark contrast to the relative calm of early 2025. Maritime insurance premiums for passage through the Gulf tripled, disrupting supply chains far beyond just the energy sector.<\/p>\n
As of today, April 13, 2026, the situation has stabilized but remains a key source of underlying risk. Tensions have eased following diplomatic efforts late last year, with oil now trading closer to $85 per barrel. The VIX has settled back to around 18, suggesting traders are less fearful of an immediate shock.<\/p>\n
Given this backdrop of reduced but persistent tension, traders should consider strategies that benefit from this fragile stability. Selling out-of-the-money put credit spreads on broad market indices like the S&P 500 could capture premium from the remaining volatility. This strategy profits from time decay and sideways market movement, but requires defined risk management in case of a sudden flare-up.<\/p>\n
For direct energy exposure, the implied volatility in oil options remains elevated compared to historical averages. Purchasing long-dated, out-of-the-money call options on oil ETFs like USO offers a low-cost way to hedge against a potential new conflict. This provides significant upside exposure while strictly limiting the capital at risk.<\/p>\n
We must also watch for signs of renewed risk-off sentiment, which would benefit safe-haven assets. During the peak tensions in 2025, the Japanese Yen and US dollar saw substantial inflows. Any breakdown in the current diplomatic quiet would likely see a repeat of this flight to safety, creating opportunities in currency derivatives.<\/p>\n
Create your live VT Markets account<\/a>\u00a0and\u00a0start trading<\/a>\u00a0now. <\/b><\/p>\n","protected":false},"excerpt":{"rendered":" Asian stocks fell as US-Iran talks stalled and Trump pledged Strait of Hormuz blockade, lifting oil prices.<\/p>\n","protected":false},"author":87,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[71],"tags":[],"class_list":["post-44482","post","type-post","status-publish","format-standard","hentry","category-live-updates"],"acf":{"acf_article_selection_author":null},"aioseo_notices":[],"aioseo_head":"\n\t\t\n\t\n\t\n\t\n\t\n\n\t\t