Recently, there have been new developments in the Middle East situation, with US-Iran negotiations breaking down directly, which has an immediate impact on crude oil prices.

On May 11th, the crude oil market reacted quite intensely. I saw WTI crude oil jump by 5.36% at the open, reaching $99.74 per barrel, and Brent crude also rose by 5.21%, reaching $105.46 per barrel. In contrast, gold actually fell by 0.68% that day, dropping to $4,683 per ounce.

The core of the event is that the US and Iran vetoed each other's peace proposals. Iran demanded the lifting of oil sanctions within 30 days and the establishment of control over the Strait of Hormuz, which was directly rebuked by Trump as "completely unacceptable." This deadlock in negotiations has caused traders to reassess the risk of escalating conflict.

Interestingly, the market's expectations for the subsequent trend of oil prices are adjusting. Traders generally lowered their expectations for Iran-sanctioned oil returning to the market in the short term, implying increased uncertainty on the supply side. Saudi Aramco, the world's largest oil company, even warned that even if the Strait of Hormuz were reopened immediately, it would take several months for the oil market to return to normal.

Citi's energy strategist Anthony Yuen said that crude oil prices have been quite volatile, and if US-Iran negotiations continue to stalemate, oil prices could further rise. Citi's forecast is that Brent crude oil will reach a target price of $120 per barrel in the next three months. This forecast reflects the market's re-pricing of geopolitical risks.

As for gold, Walsh Trading's Sean Lusk believes that as long as US stocks continue to perform strongly, the gold market will find it difficult to attract large-scale capital inflows. However, he also pointed out that although precious metals face short-term pressure, gold has always found solid support after each correction, so current prices are actually attractive.

Sean Lusk's view is that the Federal Reserve's monetary policy is unlikely to change significantly in the short term. They might discuss rate hikes, but will not take real action until clear inflation data is available. Based on this judgment, he believes that gold is currently worth buying, with an estimated future price returning to above $5,000, then pushing again into the $5,200 to $5,400 range. Therefore, for traders concerned with crude oil prices and precious metals trends, it is indeed necessary to closely monitor geopolitical developments during this period.