Brent crude oil spiked 8% to $109.74 per barrel after President Donald Trump rejected Iran’s peace proposal, calling it “unacceptable.” The move reversed weeks of price declines that had been driven by cautious optimism around a potential de-escalation in US-Iran hostilities.
Iran’s proposal reportedly included reopening the Strait of Hormuz in exchange for sanctions relief. Trump’s dismissal on April 29 was swift and unequivocal, prompting renewed military posturing from both sides.
Oil’s rally and the ripple into crypto
Bitcoin’s volatility surged in tandem with crude prices. Market odds of Bitcoin surpassing $66,000 by early May showed a slight decline, suggesting traders were hedging rather than betting big on a breakout. Prediction markets painted a similar picture for oil, pricing the probability of WTI crude reaching $150 by mid-May at just 2.6%.
The bigger picture on US-Iran tensions
The Strait of Hormuz is the world’s most important oil chokepoint. Roughly one-fifth of global petroleum consumption passes through it daily.
An expert estimate cited by prediction markets suggests a 41.5% probability of WTI crude hitting $110 by the end of May.
What this means for crypto investors
Iran itself has been using digital assets to navigate US sanctions since 2018, including crypto mining operations that generate revenue when traditional oil exports are restricted.
The cautious positioning visible in prediction markets — declining odds for both peak oil prices and a Bitcoin breakout — suggests traders aren’t in panic mode. They’re recalibrating.
Investors watching this space should pay close attention to two things: any movement on the diplomatic front between the US and Iran, and whether Bitcoin’s trading volume increases on days when oil makes significant moves. If those two assets start moving in tighter correlation, it would signal that macro traders are treating crypto as part of the geopolitical trade, not separate from it.
