After threatening to strike Iran "hard" and declaring that US "guns were locked and loaded," US President Trump abruptly changed course on August 1, calling off the planned strike and announcing that negotiations between the US and Iran would take place on the 3rd. In response, WTI crude oil futures plummeted nearly 7% at the open of Asian trading on August 3, falling below the $80/barrel mark, while Brent crude dropped as low as $81.55/barrel—a decline of 7.26%. Meanwhile, gold and silver prices rose, with spot gold opening above $4,080/ounce; the US dollar rebounded from a more-than-one-month low, and US 10-year and 30-year Treasury futures opened up 13 points and 22 points, respectively.

As of writing, the decline in international oil prices has narrowed; Brent and WTI crude futures are trading at $83.70/barrel and $80.60/barrel, respectively, down nearly 5%. Spot gold is up 0.76% at $4,072/ounce, and spot silver has risen 1.17% to over $58/ounce.

According to Xinhua News Agency, Trump posted on social media on August 1 that Iran and other Middle Eastern nations had just requested a delay in the strike against Iran. Trump stated that the parties involved had reached a preliminary agreement framework, which included the immediate, comprehensive, and total opening of the Strait of Hormuz, alongside the elimination of the nuclear threat posed by Iran. "Based on this request, I agreed to call off the military strike, provided that the parties can quickly finalize the agreement. Israel has joined me in making this commitment."

However, Iran has denied this. On the 2nd, Iranian officials cited military sources describing Trump's claim—that Iran had asked to halt the attack—as "another lie," stating that Iranian forces remain "at the highest state of alert and are prepared for any eventuality."

Prior to this, US media had reported that Trump was "seriously considering" strikes on Iranian energy facilities in the coming days, with operations potentially beginning as early as the weekend and lasting for several days. Citing *The Wall Street Journal*, Xinhua reported that Trump told reporters that day he planned to resume heavy military strikes to force Iran back to the negotiating table. He claimed that if the U.S. struck hard enough, Iran would eventually be unable to hold out.

Since the outbreak of hostilities between the U.S. and Iran, Trump has repeatedly threatened to strike Iranian energy and other civilian facilities, only to subsequently call off the attacks. Such sudden reversals have become a hallmark of the U.S.-Iran conflict, which has been ongoing for over five months.

At one point, tensions ran high. On August 1 (local time), the U.S. State Department issued a broad security warning to U.S. citizens in the Middle East, advising them to "consider departing the area or be prepared to evacuate quickly should the situation escalate."

Xinhua’s analysis suggests that the U.S. decision to cancel the strikes highlights two factors: first, Iran is "betting" that Gulf states—which would bear the brunt of the conflict's impact—will persuade Trump to exercise caution regarding military action; and second, the Trump administration faces significant risks in launching another strike on Iran ahead of the midterm elections.

Domestically, the prospect of a war with Iran has become increasingly unpopular as the midterm elections approach. A joint poll by Reuters and Ipsos released on July 27 showed that only one-third of American respondents supported U.S. military action against Iran—the lowest level of support since the conflict began. Reports indicate that public support for the conflict has remained below 40% since the U.S. launched military operations against Iran on February 28. (Source: The Paper)

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