[MARKET ANALYSIS] Energy slumps following the pause in US strikes on Iran since Friday night

The main update has been that the US paused strikes against Iran over the weekend. Meanwhile, US CENTCOM reportedly advised that the US should either resume a large-scale operation to destroy remaining military targets or end the current limited bombing campaign, noting Iran’s maritime capabilities had already been significantly degraded. Iran maintained that diplomacy with the US remains open but prioritised national defence, rejected US influence in the Strait of Hormuz, reaffirmed support for Hezbollah, and warned of retaliation following a reported Ukrainian attack on an Iranian vessel. Notably, the Iranian Foreign Ministry spokesperson in his presser said Iran has not requested the resumption of talks with the US and added that intermediaries are conveying messages to the US. Further, Yemen’s Houthis said they carried out operations against Aramco facilities in Saudi’s Jizan and Yanbu, while the Houthis said on Sunday that they attacked three Saudi oil tankers in the past 48 hours, whilst an oil tanker exploded in the Strait of Hormuz after hitting a naval mine when it deviated from a navigation route designated by Iran. Nonetheless, the pause in military strikes has hit the energy markets across the board, but losses have been trimmed this morning. Brent Oct’26 slipped over 6% at one point to USD 85.50/bbl (vs high of USD 88.95/bbl) before trimming some losses. WTI Sep’26 fell to a USD 83.10/bbl trough (vs a USD 86.20/bbl peak). Dutch TTF slumped under EUR 60/MWh from last week’s levels above EUR 63/MWh. Dutch TTF hit a low under EUR 58/MWh before trimming losses to levels near EUR 59.50/MWh. Metals are firmer across the board intraday but off best levels as energy trims losses, albeit to varying degrees. Spot gold trades towards the bottom end of a USD 4,083.80-4,116.19/oz range vs Friday’s USD 4,052/oz close. Spot silver similarly resides towards the bottom end of a USD 59.08-60.09/oz range, and vs Friday’s USD 58.20/oz low. Gains across base metals are more modest as energy prices trim losses. 3M LME copper resides in a narrow USD 13,615.0- 13,730.43/t range at the time of writing.