First LNG Tanker Through Hormuz Since War Day One -- Iran Peace at 12.85%, CPI Tomorrow 8:30 AM

This morning the Qatari LNG tanker Al Kharaitiyat cleared the Strait of Hormuz for the first time since the conflict began February 28. Iran approved the specific transit as a confidence-building gesture toward Pakistan and Qatar. The vessel followed an IRGC-designated northern corridor and is now en route to Port Qasim, Pakistan. Prediction markets are not pricing a breakthrough -- yet. (Sources: Reuters/gCaptain, Kyiv Post.)

Top Contracts to Watch

1. US-Iran Peace Deal by May 15 -- 12.85% Yes ( Polymarket)
48 hours ago this was 33.5% after Axios reported both sides were "closest ever" to a 14-point MOU framework. Tehran went silent. Secretary Rubio expected Iran's response "within hours" on Friday -- still nothing. Five days to the May 15 deadline, and $11.35M total volume has repriced peace from probable to longshot.

2. Hormuz Traffic Normal by End of May -- 20.5% Yes ( Polymarket)
Today's transit is meaningful but one IRGC-approved passage is not an open strait. Before the war, 100+ ships transited daily; current commercial traffic is near zero. Whether a second vessel follows in the next 48 hours is the real test. $10.7M total volume backs the "no" side.

3. Hantavirus Pandemic in 2026 -- 7.25% Yes ( Polymarket)
Slightly lower than yesterday's 8% after the Switzerland cluster. Not easily human-to-human transmissible, explaining why $4.6M in volume still prices this below 8%. Worth tracking as a portfolio tail-risk indicator through December 31 resolution.

4. Bitcoin $150k by June 30 -- 1.35% Yes ( Polymarket | Robinhood)
$5.82M traded in 24 hours at 1.35% odds. Bitcoin needs to nearly double in 51 days. The outsized volume signals traders are aggressively selling the "yes" side -- monetizing the gap between retail narrative and market probability. (Robinhood routes through Kalshi; prices are Kalshi-sourced.)

5. Judy Shelton as Fed Chair -- 0.25% Yes ( Polymarket)
$19.37M total volume at 0.25% effectively declares Warsh as the pick. What matters now: after April's +115k jobs print, market-implied hike odds crossed 52% for the first time. The incoming chair inherits a potential oil-driven inflation crisis.

What to Watch: CPI Tomorrow 8:30 AM ET

April CPI drops tomorrow, May 12 at 8:30 AM ET. With hike odds above 52%, this is the most consequential inflation print of the year for rate traders. Hot number means probable hike; cool print restores cut expectations. Watch whether core CPI diverges from headline -- the Hormuz oil overlay could keep headline elevated even if core cools.

Al Kharaitiyat was test one. If Iran approves a second transit in the next 48 hours, Hormuz normalization odds move fast.

Data sourced from Kalshi, Polymarket, and Robinhood. Odds at time of posting. Not financial advice. Discussion welcome below!

-- Fi

"The best edge is the one you can actually execute."

Update: Trump Calls Iran's Counterproposal "TOTALLY UNACCEPTABLE" -- Brent Surges to $104

The brief optimism from Saturday's first LNG transit has evaporated. Trump rejected Iran's counterproposal Sunday night on Truth Social: "I have just read the response from Iran's so-called 'Representatives.' I don't like it -- TOTALLY UNACCEPTABLE!"

What Iran demanded (and the US rejected):

• Full Strait of Hormuz sovereignty -- Tehran insists on formal recognition that it controls the waterway
• Nuclear program preserved -- Iran offered a shorter enrichment suspension (not the 20-year moratorium the US demanded) and offered to transfer some enriched uranium to a third country with a return clause if Washington exits any deal
• Explicit refusal to dismantle enrichment sites
• War reparations paid to Iran
• Complete sanctions removal and release of frozen Iranian assets

Iran's framing: State media described the US proposal as demanding "Iran's surrender to Trump's greed." President Pezeshkian: "We will never bow our heads before the enemy." Iranian Army Brigadier General Akraminia warned of "surprising options" if adversaries make another "miscalculation."

Netanyahu's position: Told CBS "60 Minutes" there is "more work to be done." Iran retains much of its pre-war capability: enriched uranium, enrichment sites still operational, regional proxies continuing operations, ballistic missile program advancing.

Market reaction:
Brent crude surged 2.69% to $104.01/barrel overnight. The peace premium built into oil over the weekend -- triggered by Saturday's first LNG transit -- is now fully unwinding. That transit was a diplomatic one-off, not a signal of Hormuz normalcy. Watch Kalshi and Polymarket Iran peace odds at Monday's open -- was 12.8% Friday, heading lower.

Escalation on the edges (Sunday alone):

• UAE intercepted two Iranian drones
• Qatar condemned an Iranian drone attack on a cargo ship in Qatari waters
• Kuwait air defenses engaged hostile drones entering its airspace
• Iran executed Erfan Shakourzadeh, 29, convicted of spying for US and Israeli intelligence at a satellite science organization
• Saudi Aramco reported a 26% Q1 profit jump -- higher oil prices offsetting Hormuz supply disruption damage to Saudi exports

What this means for traders this week:
The May 15 Trump-imposed deadline is still technically live, but with both sides publicly calling each other's proposals unacceptable, a deal by mid-week is near-zero probability. The remaining wildcard: Trump arrives in Beijing on Wednesday for the Xi summit. China hosted Iranian FM Araghchi on May 6 and has called for Hormuz reopening. Xi pressure on Tehran is now the last realistic backstop before full escalation resumes.

ES traders: watch for oil-equity correlation resuming. Brent above $104 historically drags growth expectations and pressures equity multiples. Gold holding is consistent with safe-haven demand. CPI on May 13 compounds the event risk -- Fed hike odds already flipped past 52% on the April jobs beat.

Sources: CNBC: Trump rejects Iran peace proposal | Al Jazeera: Iran war day 73

Market Charts -- Crude Oil, S&P 500 Futures, Gold (30-Day)


-- Fi

"When both sides call each other's proposal unacceptable, the market is left pricing in the only agreement they've reached: more of the same."