Hormuz “Completely Open” Then Reverses — Oil Crashes 9% — Ceasefire Expires Tomorrow
Today’s Brazil morning call opens on the most pivotal day since the war began: the ceasefire expires tomorrow, the Strait’s status is contested, and the market is betting on peace. This is part of The Rio Times’ daily Brazil Financial Morning Call, covering Latin American financial markets.
Friday delivered a session for the history books. Iran’s Foreign Minister Araghchi posted on X that the Strait of Hormuz was “completely open” for commercial shipping during the Israel-Lebanon ceasefire — the first full reopening since the war began on February 28. Oil crashed: WTI plunged 9.4% to $82.59, Brent fell nearly 10%. Trump said Iran had agreed to suspend its nuclear program “indefinitely” — the key sticking point that derailed the Islamabad talks. “Most of the main points are finalized. It’ll go pretty quickly,” Trump said. The S&P 500 surged 1.20% to 7,126.06 — its third consecutive ATH. The Dow soared 868 points (+1.79%) to 49,447. The Nasdaq rose 1.52% to 24,468, posting its 13th gain in 14 sessions. At least eight oil tankers raced toward the Strait on Friday in a live test of the announcement.
Then Saturday brought the reversal. Iran’s IRGC said the Strait “has returned to its previous state.” Most of the tankers turned back. The nuclear suspension terms remain unresolved — officials confirmed there’s still no agreement on how long enrichment would be suspended or how to handle Iran’s stockpile of highly enriched uranium. Trump, returning from Phoenix late Friday, said he’d received “pretty good news” about Iran and that negotiations would continue “over the weekend.” The ceasefire expires Tuesday, April 21 — tomorrow. Weekend talks are reportedly underway but no confirmation of a framework deal.
The Ibovespa closed Friday at 195,734 (−0.55%) — continuing its healthy consolidation from the 198,657 ATH. The USD/BRL held at R$4.9771 (−0.03%), now below R$5.00 for a fifth consecutive session with RSI at 35.23 (MA: 28.88) — the deepest oversold of the entire cycle. Monday is dominated by the ceasefire countdown: BCB Focus Readout (07:25 BRT), German PPI (cons: +1.4% MoM), Canada CPI, ECB Lagarde (12:40). War Day 51. Tomorrow is Day 52 — and the day the ceasefire clock hits zero.
Three Things That Matter
| Friday | HORMUZ OPENS: Iran FM Araghchi posted Strait “completely open” for commercial shipping during Israel-Lebanon ceasefire. OIL CRASH: WTI −9.4% to $82.59, Brent −10%. Trump: Iran agreed to suspend nuclear program “indefinitely” — “most of the main points are finalized.” S&P 500 +1.20% to 7,126 (3rd ATH). Dow +868pts (+1.79%) to 49,447. Nasdaq +1.52% to 24,468. Russell 2000 +2.11%. VIX −2.56% to 17.48. 8+ oil tankers raced toward Strait. Netflix fell after hours Thursday but market shrugged it off. Gold +1.48% to ~$4,880. BTC $75,639 (−1.82%). Strategy (MSTR) +14%. Ibovespa −0.55% to 195,734. USD/BRL R$4.9771 (5th day below R$5.00) |
| Weekend | STRAIT REVERSAL: IRGC says Hormuz “returned to its previous state.” Most tankers turned back after initially heading toward the Strait. Nuclear deal terms still unresolved — no agreement on enrichment suspension duration or uranium stockpile handling. Trump on Air Force One Friday night: received “pretty good news” about Iran, negotiations continuing “over the weekend.” Weekend talks reportedly underway but no framework confirmed. White House: “Strait of Hormuz is completely open for business, and Iran has agreed to never close the Strait again.” Iran disputes this framing. Key sticking points remain: enrichment terms, uranium stockpile, verification mechanisms |
| Today | CEASEFIRE EXPIRES TOMORROW — April 21. Market enters the week pricing a deal at high probability but with physical Strait status in dispute. German PPI (02:00 ET, cons: +1.4% MoM — oil pass-through). BCB Focus Readout (07:25 BRT — first reading with BRL sub-R$5.00 for a week). Canada CPI (08:30, cons: +1.1% MoM). BoC Business Outlook (10:30). ECB Lagarde (12:40). US Retail Sales (rescheduled to tomorrow, April 21). China FDI (10:00). Bill auctions. S&P futures slightly positive overnight. Oil futures volatile — gap risk on Strait status. War Day 51 |
Where We Left Off FRIDAY, APR 17 + WEEKEND
Friday was the most consequential session since the ceasefire was announced on April 7. Iran’s Foreign Minister Araghchi declared the Strait of Hormuz “completely open” for commercial shipping, linked to the 10-day Israel-Lebanon ceasefire that began Thursday. At least eight oil tankers that had been stuck in the Persian Gulf raced toward the Strait, testing the announcement in real time. WTI crude plunged 9.4% to $82.59 — the first close below $85 since the war’s early days — while Brent fell nearly 10%. The oil crash was the single largest daily move since the original ceasefire’s 16% drop on April 8.
Trump elevated the stakes further. In a phone interview, he said Iran had agreed to suspend its nuclear program “indefinitely” — the issue that collapsed the Islamabad talks. “Most of the main points are finalized. It’ll go pretty quickly,” he said, adding that talks would “probably” be held this weekend. The S&P 500 surged 1.20% to a fresh ATH of 7,126.06 — its third consecutive record close. The Dow exploded 868 points (+1.79%) to 49,447 — the broadest rally since the original ceasefire day. The Nasdaq rose 1.52% to 24,468. The Russell 2000 gained 2.11%, approaching its first record close since January. The previous Morning Call flagged the ceasefire countdown as the week’s binary catalyst — and Friday delivered the bullish resolution. For the week: S&P +4.5%, Nasdaq +6.7%, Dow +3.2%.
Then Saturday muddied the picture. Iran’s IRGC said the Strait “has returned to its previous state.” Most of the tankers that raced toward the opening turned back into the Persian Gulf. Officials confirmed no agreement exists on enrichment suspension duration or how to handle Iran’s uranium stockpile. The White House maintained that the “Strait of Hormuz is completely open for business,” but Iran’s military disputes this. The gap between Trump’s characterization (deal nearly done, nuclear suspension agreed) and the physical reality (Strait contested, terms unresolved) is the market’s primary risk for Monday’s open.
Market Snapshot DATA AS OF FRI, APR 17 CLOSE
| Indicator | Close / Level | Change |
|---|---|---|
| Ibovespa | 195,734 | −0.55% |
| USD/BRL | R$4.9771 | −0.03% (5th day <R$5) |
| S&P 500 | 7,126 | +1.20% (3rd ATH) |
| Dow | 49,447 | +1.79% (+868pts) |
| Nasdaq | 24,468 | +1.52% |
| WTI Crude | $82.59 | −9.4% |
| Gold | ~$4,880 | +1.48% |
| Bitcoin | $74,470 | +0.87% |
| VIX | 17.48 | −2.56% |
What to Watch MONDAY CATALYSTS
The ceasefire clock is the single catalyst that matters. The two-week agreement expires Tuesday, April 21. Trump said talks would continue “over the weekend” and that he’d received “pretty good news.” If a framework deal or ceasefire extension is announced before Monday’s open — or during the session — the peace rally extends and oil stays near $80-85. If weekend talks produce nothing and the ceasefire lapses, oil gaps higher and the week’s gains are at risk. Iran’s IRGC reversal on the Strait creates maximum uncertainty: the market priced the opening on Friday, but the physical reality on Saturday contradicted it.
The BCB Focus Market Readout at 07:25 BRT is the most consequential Focus survey in months. The BRL has been below R$5.00 for five consecutive sessions. Oil collapsed to $82. Trump is signaling deal proximity. How aggressively have Brazilian economists revised their inflation, Selic, and growth forecasts? Any dovish shift in the Focus median strengthens the case for a June cut signal at the April 28 Copom meeting (8 days away). German PPI at 02:00 ET (cons: +1.4% MoM) shows whether the oil price reversal is already flowing through to European producer costs. Canada CPI at 08:30 (cons: +1.1% MoM) provides the G7 inflation comparison.
US Retail Sales (March) have been rescheduled to tomorrow, April 21 — the same day the ceasefire expires. That creates a dual catalyst tomorrow: consumer spending data + geopolitical deadline. ECB’s Lagarde speaks at 12:40 — her tone on the oil crash’s inflation implications will set European rate expectations for May.
Ibovespa Setup TECHNICAL LEVELS
The Ibovespa continued consolidating. Chart: O:196,881, H:198,666, L:195,368, C:195,734 (−0.55%). RSI moderated to 64.52 (MA: 64.52) — now fully below the overbought zone at equilibrium. MACD histogram at 3,989 (MACD: 3,192.12, signal: 796.93) — while still bullish, the histogram has started to flatten, suggesting momentum is entering a transition phase. The upper Bollinger at 202,514 shows the 200,000 milestone now sits within one standard deviation of the current price.
Resistance: 195,734 (Friday close) → 198,657 (ATH close) → 199,355 (cycle intraday ATH) → 200,000 (psychological) → 202,514 (upper Bollinger).
Support: 195,540 (mid-range) → 192,620 (prior ATH cluster) → 189,909 (mid-Bollinger) → 189,219 / 187,197 (SMA clusters) → 186,537 (20-day) → 175,924 (lower Bollinger) → 158,735 (200-day).
Copom Watch SELIC AT 14.75% · NEXT MEETING: APR 28-29
Oil at $82 with the BRL at R$4.98 is the most dovish combination for the BCB since the war began. If Friday’s oil crash proves durable — driven by a genuine Hormuz reopening — the entire inflation trajectory for 2026 resets. Gasoline prices at the pump could start falling within weeks. The BCB Focus survey this morning is the first to capture a full week of sub-R$5.00 BRL and post-PPI-cool data. Expect material downward revisions to 2026 inflation expectations.
The April 28 Copom meeting (8 days away) now faces a radically different macro backdrop than it expected even two weeks ago. BRL sub-R$5.00 for five days. Oil at $82 (from $105+ at the blockade peak). PPI services flat. Claims at 207K. Trump signaling the war is nearly over. If the ceasefire extends or a framework deal is announced this week, the BCB has the justification for dovish forward guidance that explicitly opens the June cut window. A hold at 14.75% remains the base case — but the tone of the communiqué shifts from “vigilant” to “monitoring favorable developments.”
Economic Calendar MONDAY, APR 20
| Time | Event | Impact |
|---|---|---|
| Pre-Market | German PPI (02:00 ET, cons: +1.4% MoM — oil pass-through under Hormuz opening). EU Construction Output (05:00). German Buba Monthly Report (06:00). Japan Tertiary Industry Activity (00:30). India Infrastructure Output (07:30) | MEDIUM |
| 07:25 BRT | BCB Focus Market Readout — first survey with full week of BRL sub-R$5.00 + post-PPI-cool + oil at $82. Key for April 28 Copom guidance. Expect material downward revisions to inflation and Selic path forecasts | HIGH |
| 08:30–10:30 | Canada CPI (08:30, cons: +1.1% MoM) — G7 inflation read under oil crash. Canada Core/Median/Trimmed CPI. BoC Business Outlook Survey (10:30). Note: US Retail Sales rescheduled to TOMORROW (April 21) — dual catalyst with ceasefire expiration | HIGH |
| 11:30–15:00 | US 3/6-Month Bill Auctions (11:30). ECB Lagarde speaks (12:40 — tone on oil crash + inflation implications). Argentina Trade Balance (15:00, cons: $1,019M). China FDI (10:00). CEASEFIRE EXPIRES TOMORROW: any weekend deal announcement could come at any time today/tonight | CRITICAL |
Latin America Markets FRIDAY CLOSE / CHART DATA
| Index | Close | Change | RSI (14) | Signal |
|---|---|---|---|---|
| Ibovespa | 195,734 | −0.55% | 64.52 | Bullish |
| IPC (Mexico) | 69,826 | +1.06% | 56.14 | Neutral |
| COLCAP (Colombia) | 2,302 | −1.33% | 52.81 | Neutral |
| IPSA (Chile) | 11,429 | −0.42% | 68.26 | Bullish |
| MERVAL (Argentina) | 2,889,185 | −1.19% | 50.76 | Neutral |
Friday’s oil crash created a dramatic divergence across the region. Mexico’s IPC was the standout, surging 1.06% to 69,826 as the oil-importing economy benefited from the price collapse. Chile’s IPSA eased 0.42% to 11,429 but held its bullish RSI at 68.26 — copper demand from China remains the structural driver. Colombia’s COLCAP dropped 1.33% to 2,302 as the oil-producing economy took a direct hit from the 9.4% crude crash — the sharpest single-session reversal for the petro-sensitive index since the original ceasefire. Argentina’s MERVAL fell 1.19% to 2,889,185, sliding further from the 3 million level. The Ibovespa’s consolidation to 195,734 (RSI 64.52) is constructive — it has reset from the 73+ overbought peak and now sits at equilibrium, perfectly positioned for a deal-driven push toward 200,000 if the ceasefire resolves positively. As covered in the latest LATAM Pulse, the ceasefire’s resolution will determine whether the oil crash is permanent (bullish for importers) or temporary (recovery for exporters).
Commodities & FX KEY MOVES
Oil had its most dramatic session since the ceasefire announcement. WTI crashed 9.4% to $82.59 — its first close below $85 since the war began. Brent fell nearly 10%. The trigger was Iran’s FM declaring the Strait “completely open,” reinforced by Trump claiming the nuclear issue was resolved. But Saturday’s IRGC reversal (“returned to its previous state”) and the tankers turning back mean Monday’s oil open is a coin flip. If weekend talks produce a framework, WTI targets $75-78. If the Strait re-closes definitively and talks collapse, WTI gaps back to $90-95.
USD/BRL closed its fifth consecutive session below R$5.00 at R$4.9771 (chart: O:4.9787, H:4.9787, L:4.9771, C:4.9771, −0.03%). RSI at 35.23 (MA: 28.88) — both the RSI and the MA are at the deepest oversold readings of the entire war rally. The MACD remains bearish at −0.0144 (signal: −0.0505, MACD: −0.0650). The real’s appreciation trajectory is now fully structural — five consecutive closes below R$5.00 with oil at $82 and a potential deal forming. If the ceasefire resolves positively, R$4.90 is the next target. If it collapses, R$5.05-5.10 provides support.
Bitcoin held near $74,470 (chart: O:73,834, H:74,769, L:73,753, C:74,470, +0.87%). RSI at 60.11 (MA: 57.19) — steady bullish momentum. Gold surged 1.48% to ~$4,880 — a breakout driven by the combination of dollar weakness, rate-cut expectations from the oil crash, and safe-haven demand ahead of the ceasefire expiration. The gold-oil divergence (gold at near-highs while oil crashed) reflects the market’s hedging posture: risk-on in equities AND safe-haven in gold simultaneously.
Risk Map BULL vs BEAR
| Bull Case | Bear Case |
|---|---|
| The war is ending — Trump’s “unlimited nuclear suspension” is the deal-breaker — The nuclear issue was the one thing that collapsed Islamabad. If Iran agreed to suspend enrichment indefinitely, every other sticking point (Strait, reparations, Lebanon) is secondary. Trump saying “most of the main points are finalized” is the strongest signal since the conflict began. Weekend talks are underway. The 10-day Israel-Lebanon ceasefire removes the side-conflict that complicated everything. A framework deal this week would send oil to $75, the S&P to 7,200, and the Ibovespa to 200,000+.
Oil at $82 resets the entire inflation narrative — From $105 at the blockade peak to $82 in ten days is a 22% decline. If durable, gasoline prices drop below $3.50 by May, March/April inflation recedes from the data, and the Fed’s cut path reopens. For Brazil, R$4.98 BRL + $82 oil = the most dovish BCB backdrop since 2021. The carry trade enters a new phase: not just yield, but FX + inflation + rate-cut optionality. The S&P at 7,126 is pricing post-war economics — Goldman’s 7,600 is the new target — Three consecutive ATHs, Nasdaq 13-of-14 winning, Dow +868, Russell near ATH. Earnings at 12.6% growth. AI capex accelerating. The market has moved from “surviving the war” to “pricing the peace dividend.” |
Saturday’s IRGC reversal proves the Strait isn’t actually open — Tankers turned back. The IRGC said the Strait “returned to its previous state.” There’s a massive gap between Trump’s characterization and physical reality. If Monday reveals the Strait remains blocked, oil rebounds 5-10% immediately and Friday’s entire 9.4% crash reverses. The market priced a reopening that may not have happened.
The nuclear “agreement” may not exist — Officials confirmed no agreement on enrichment duration or uranium stockpile handling. Trump claiming “indefinite suspension” while Iran’s position remains unclear is exactly the pattern from the original ceasefire — bold claims followed by reality checks. If weekend talks produce no framework, the ceasefire expires tomorrow with the same unresolved issues that killed Islamabad. The Ibovespa’s consolidation from 198,657 to 195,734 (−1.5%) while the S&P surges is a warning — If the ceasefire resolves positively, Brazil should have rallied harder on the oil crash + BRL strength. Instead, it has dropped three of the last four sessions. The energy-heavy Ibovespa (Petrobras, PRIO) faces headwinds from $82 oil. The index may need oil stabilization, not further declines, to push through 200,000. |
Positioning BOTTOM LINE
This is the most consequential week of the entire war. The two-week ceasefire expires tomorrow. Trump says the deal is nearly done. Iran’s FM opened the Strait on Friday but the IRGC reversed it Saturday. Oil crashed 9.4% on peace hopes, but the physical reality on the water is contested. Weekend talks are reportedly underway. The gap between optimism and reality has never been wider — and it resolves this week, one way or another.
For Brazilian assets, the stakes are enormous. The BRL below R$5.00 for five days, oil at $82, and the BCB Focus survey this morning — if these converge with a ceasefire extension or deal framework, the April 28 Copom meeting becomes the launching pad for a June cut signal. The Ibovespa at 195,734 (RSI 64.52) is perfectly positioned: the overbought condition from the 73+ peak has been fully digested, the bullish structure is intact, and a deal catalyst would provide the clean technical breakout toward 200,000. Conversely, if talks collapse and the Strait re-closes, R$5.05-5.10 BRL, $95+ oil, and a pullback toward 190,000 are the downside scenarios.
Today’s Focus Readout at 07:25 BRT sets the BCB framework. Lagarde at 12:40 sets the ECB framework. And somewhere between now and tomorrow’s expiration, the Strait of Hormuz either reopens for good — ending the war’s most damaging economic consequence — or closes again, extending the conflict into its ninth week. The carry trade at R$4.98 has never been more powerful. The energy hedge has never been more binary. And the ceasefire clock has never been closer to zero. Position for both outcomes. Watch the ships, not the statements. And prepare for the week that decides whether the war ends or escalates for the last time.
RT Staff Reporters · This newsletter is for informational purposes only and does not constitute investment advice. Always consult a licensed financial advisor before making investment decisions. Past performance does not guarantee future results.