🔹 Market Overview

The U.S. has officially launched airstrikes on three Iranian nuclear sites, marking a major escalation in the Middle East conflict.
While the current situation appears to be a “measured strike”, whether it evolves into full-scale U.S. involvement remains the key uncertainty.

🔸 Our base case: A limited engagement (“point strike”) is more likely in the short term.

The market is now closely watching:

  1. Will Iran retaliate by attacking U.S. bases in the Middle East?
  2. Will Iran attempt to block the Strait of Hormuz, disrupting global oil transport?

Regardless of further developments, U.S. military intervention was not previously priced in, and oil prices are likely to surge in response.

🔹 Implications for Steel Market

  • Higher oil prices → Stronger energy & coking coal markets
  • Stronger coking coal → Near-term support for steel prices
  • Steel market likely to rebound temporarily under external shocks
  1. Volatile price action, weakened basis
  2. Raw materials firming up, narrower price ranges
  3. Stable domestic policy, rising external geopolitical risk

🔹 Outlook & Trading Strategy

While short-term rebound is likely due to geopolitical risk premium, domestic fundamentals remain weak:

  • Limited policy stimulus
  • Sluggish demand
  • Oversupply pressure to reemerge soon

Core Strategy: Sell on Strength

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