CHINESE DRONE SHIPMENTS NOSE-DIVE ON DOMESTIC RESTRICTIONS, US BAN - NIKKEI

Reports of a framework agreement between Tehran and Washington remain “mere speculation,” with negotiations continuing through a Pakistani mediator. Discussions focus on core disputes including the Strait of Hormuz, highly enriched uranium, and sanctions. Any breakthrough would still require approval from Tehran’s top leadership.

A closure of the Strait of Hormuz through August could trigger an economic downturn approaching the scale of 2008, according to Rapidan Energy Group. The firm’s base case assumes reopening in July, with oil demand down 2.6 million barrels a day and Brent peaking near $130 this summer. A longer disruption could deepen supply deficits, potentially driving a rare global oil demand contraction in 2026. Rapidan said oil prices have nearly doubled since late February amid war-related disruptions, warning that further spikes could amplify macroeconomic vulnerabilities despite less oil-intensive economies and stronger monetary policy frameworks.