Overnight market key turning point! Netanyahu: Suspension of airstrikes on Iranian energy facilities, war may "end earlier than expected"

Last night, global capital markets experienced intense turmoil. The market had been heavily suppressed by the collective hawkish turn of central banks worldwide and growing concerns about a prolonged Middle East war, but a speech by Israeli Prime Minister Netanyahu directly became the key turning point reversing market sentiment.

On the evening of March 19 local time, Netanyahu held a press conference in Jerusalem. Regarding developments in the Middle East, according to Xinhua News Agency, Netanyahu stated, after 20 days of Israeli-American air strikes, Iran has lost its uranium enrichment and ballistic missile production capabilities. He stated that there are three goals for military action against Iran: first, to eliminate Iran's "nuclear threat"; second, to eliminate Iran's ballistic missile threat; third is "regime change."

As for the subsequent situation, Netanyahu gave a timeframe expectation. He said, "I believe this war will end much sooner than people imagine. During war, you must grit your teeth." Netanyahu refuted the idea of launching endless military action against Iran, stating at the press conference that the objectives he set are achievable.

Energy Conflict Cools Down: Israel Pledges to "Pause" Strikes on Iran's Energy Facilities

In recent days, Iran’s largest gas field—the South Pars field—was attacked, triggering Iranian retaliation towards Qatar and other Gulf energy hubs. Key energy facilities were hit, directly pushing Brent crude above $119/barrel early Thursday.

However, the situation shifted that evening. According to Xinhua News Agency, Netanyahu confirmed at the press conference that Israel "unilaterally" struck Iran's gas field. He pledged on the spot to "comply" with US President Trump's request and "pause" any further strikes on energy facilities.

Earlier that day at the White House, Trump told the media he had already informed Netanyahu not to attack Iranian energy facilities. Trump previously stated he was "completely unaware" of the attack on the South Pars gas field.

Regarding the most crucial energy chokepoint—the Strait of Hormuz—Netanyahu said Israel is assisting the US in efforts to reopen the blockaded Strait of Hormuz.

Meanwhile, Wallstreetcn mentioned that the US Treasury Department (OFAC) had issued a general license, relaxing restrictions on the delivery and sale of certain Russian crude oil, further easing supply anxieties in the crude market.

Market Priced In Rapidly: Crude Oil Plunges from Highs, US Stock Indexes Stabilize Late

Netanyahu's stance, along with US policy easing crude supply, directly drained the "risk premium" from the crude oil market.

WTI crude oil briefly breached $100/barrel intraday, but quickly plummeted after the statements, falling more than 8% from the day's high. Brent crude turned down by over 3% late in US equity trading.

Oman and Dubai oil prices, the core producers in the Middle East, also suffered heavy declines. Dubai oil even hit a historical high of $177/barrel due to extreme panic intraday, then sharply retreated.

Oil’s rapid drop acted like an easing on risk assets. The US 2-year Treasury yield cooled from a high of 3.96%, ending nearly flat at 3.784%. The three major US stock indices recovered most of their losses in the last trading hour, with the Dow only down 0.44% and the Russell small-cap index even gained 0.65% against the trend.

Susquehanna Investment Group data showed that the S&P 500’s bullish options skewness had fallen to the 3rd percentile, meaning that as the Middle East situation cools in the short term, the market is brewing room for a technical rebound.

The Market Before the Speech: Global Central Banks' Collective Hawkishness Triggers Inflation Fears

Before Netanyahu’s speech, the market was shrouded in gloom over stagflation and a prolonged war. Over the past 24 hours, major global central banks spoke intensively, all viewing inflation pressure from the Middle East conflict as a major policy uncertainty.

According to Wallstreetcn, the US Fed, Bank of Japan, Swiss, and Swedish central banks all announced unchanged rates, with hawkish wording. The European Central Bank held steady, cut growth forecasts, and raised inflation projections, directly targeting stagflation risks; The Bank of England explicitly stated readiness to "take action" against inflation, surprising the market.

Under the strong hawkish positions and high interest rate expectations of global central banks, worries about the protraction of war pushing up global inflation reached their peak. As a non-yielding asset, gold was the first to suffer a fierce selloff, plunging more than 3.4% and briefly falling below $4,500, marking a six-week low; Silver dropped by 12% intraday.

Israel Sets Three Major Goals, Ground Action Still a Risk

While the energy dimension of the hot conflict is on hold for now, the long-term unwinding of this conflict is not yet complete.

Xinhua News Agency highlighted that Netanyahu distinctly listed three goals for military action against Iran: first, eliminate Iran’s “nuclear threat”; second, eliminate the ballistic missile threat; third, “regime change.” He said, “We are winning, Iran is being destroyed.”

Regarding the ultimate goal, Xinhua News Agency noted that Netanyahu claimed to achieve “regime change” in Iran, air strikes alone will not suffice; “there has to be a ground component.” This strongly implies Israel retains the option for ground operations. He claimed fractures have appeared within Iran’s leadership and on the front lines.

Netanyahu also said military action against Iran will “continue as long as necessary.” During the news conference, Israel Defense Forces detected Iran fired missiles at Israel, prompting air raid sirens in the north.

Responding to accusations that Israel is dragging the US into war, Netanyahu firmly denied it, clarifying the US-Israel alliance's boundaries. "Does anyone really think someone can tell President Trump what to do? Come on. President Trump always decides based on what benefits the US."

Iran Warns No More Restraint if Infrastructure Attacked Again, US May Seize Island to Force Hormuz Opening

Regarding Iran and the US, according to Xinhua News Agency, Iran’s Islamic Revolutionary Guard Corps declared on Thursday that the war with the US and Israel has entered “a new phase.” According to CCTV, Iranian Foreign Minister Aragchi warned that if domestic infrastructure is attacked again, Iran will show “zero restraint”; Iran released satellite images indicating US military facilities and equipment in Bahrain, UAE, and Iraq were damaged.

A US F-35 fighter reportedly made an emergency landing after likely being hit by Iranian fire. Reports cited two people familiar with the matter saying the F-35 made an emergency landing at a Middle East US Air Force base, suspected to be hit by Iranian fire.

The US is dispatching more troops to the Middle East and may seize Iran’s key oil export hub to force Iran to open the Strait of Hormuz.

According to Xinhua News Agency, citing reports, the US Marine Corps' 31st Expeditionary Unit, about 2,200 personnel, is headed by amphibious assault ship from Japan to the Middle East, expected to arrive in about a week. The US may use this force to occupy Kharg Island as leverage to force Iran to open the Strait of Hormuz.

JPMorgan analysts warn that investors betting on a quick resolution of the war are making high-risk wagers. Before Israel achieves its goals, the fragile geopolitical balance remains a Damoclean sword hanging over assets.

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