Iran's foreign minister meets mediators in New York; oil and yields react as diplomacy continues after Trump's rejection.
Iranian Foreign Minister Araghchi is still in New York after the UN meetings, which has boosted expectations of a possible accord. Crude prices are up after Trump turned down an initial Iranian proposal, yet diplomatic efforts appear to be ongoing.
Reaching a compromise seems highly challenging for both parties at this stage, since Tehran might view any agreement as politically driven and temporary ahead of the US midterms. Should that perception hold, building trust in any deal would be difficult. Meanwhile, both sides are restocking their weaponry.
We are monitoring any news from these talks, as the session could be brief if the mediators convey that Trump rejected the offer without presenting fresh alternatives. In such a scenario, oil might climb back to the day's peak and further. At present, it stands at $93.92, down from a session high of $96.54. US 10-year yields have hit a fresh cyclical peak, moving from 5.3 basis points to 5.23%.
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Crude finished a volatile session modestly higher, with supply fears trumping hopes of a US-Iran breakthrough after Trump dismissed the Hormuz proposal.
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Aragchi's New York stay was not extended; he met mediators, but the US did not accept their proposal and offered nothing constructive. Oil rose on the report.
Oil prices fell on reports of a possible resumption of US-Iran talks focused on an amended version of the seven-day Hormuz proposal.