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Investing.com - The "all clear" has yet to be given in the Israel-Iran conflict despite recent hopes for a ceasefire, according to analysts at BCA Research.
In a note, the strategists said that, with Tel Aviv targeting both Iran’s ruling government and its nuclear program, Tehran is likely to "defend itself more aggressively."
On Tuesday, Israel’s military said that it had carried out "several extensive strikes" on military targets in western Iran, including on surface-to-surface missile storage sites and launch infrastructure.
A senior Iranian general "in the heart of Tehran" was killed overnight, Israel’s Air Force also claimed. Iran has not yet confirmed the statement.
Meanwhile, the Trump administration is discussing with Iran the possibility of holding talks this week on a potential nuclear deal and an end to the conflict with Israel, Axios has reported.
U.S. envoy Steve Witkoff and Iranian Foreign Minister Abbas Araghchi could meet as part of the proposed talks, Axios reported, citing four sources briefed on the matter.
While the meeting is yet to be finalized, it represents a renewed effort by U.S. President Donald Trump to lower hostilities between the two Middle East powers and bring the focus back towards a nuclear deal.
Separate media reports have said that Iran has agreed to enter into negotiations only if Israel stops its bombing campaign.
Trump’s remarks about Iran have been hawkish, with the president stating that “everyone should immediately evacuate Tehran” and chiding Iran for not accepting an earlier nuclear deal. Trump has also repeatedly stated that Iran will not be allowed to enrich any uranium, despite Tehran’s claims that it has no plans to develop nuclear weaponry.
"Only the U.S. can restrain Israel, but the U.S. mostly approves of what Israel is doing," the BCA Research analysts said.
The strategists argued that the world faces a 55% chance that the current violence leads to a "major shock" in oil markets, defined as a hit to global supply that goes beyond the OPEC+ producer group’s spare capacityof 6-8 million barrels per day. This could spark a six-month jump of 50% to 100% in oil prices, they predicted.
Against this backdrop, the analysts said they are booking a gain of 10% on "long Canadian energy/short Gulf Cooperation Council equities" and will keep open other energy trades "such as long Canadian energy/short broad Canadian equities."