ceasefire between Iran and Israel

🔸 🛢 Oil Market Highlights
Oil Prices Decline Sharply: Brent crude and U.S. West Texas Intermediate (WTI) are poised for their steepest weekly losses since March 2023, both falling approximately 12%. This drop follows the easing of geopolitical tensions in the Middle East, particularly after a ceasefire between Iran and Israel. 

Surge in China's Iranian Oil Imports: China's imports of Iranian oil have reached record highs in June, averaging over 1.8 million barrels per day. This increase is driven by independent refineries, known as "teapots," capitalizing on discounted Iranian crude. 

Geopolitical Risk Premium Fades: Analysts from Goldman Sachs report that the market now reflects only a 4% probability of oil supply disruptions through the Strait of Hormuz, indicating diminished concerns over potential supply shocks. 

💱 Forex Market Implications
Canadian Dollar (CAD) Weakness: The decline in oil prices has exerted downward pressure on the Canadian dollar, given Canada's status as a major oil exporter. The USD/CAD pair has risen as a result.

Japanese Yen (JPY) Depreciation: Despite its traditional role as a safe-haven currency, the yen has weakened due to Japan's reliance on imported oil, making its economy vulnerable to rising energy costs. 

U.S. Dollar (USD) Fluctuations: The U.S. dollar has experienced volatility amid speculation about potential changes in Federal Reserve leadership and expectations of interest rate cuts, influencing currency markets globally.