Good morning. Here is a look at the key developments making headlines today.
Iran's foreign minister has unveiled what is being called a "two-day plan" aimed at breaking the deadlock. According to Iranian state media reports, Foreign Minister Araghchi said in a media interview on November 1 local time that mediators including Qatar and Pakistan held multiple rounds of consultations and discussions and put forward proposals more feasible and operable than Iran's original "seven-day plan."
Araghchi said one of Qatar's suggestions was to "shorten the seven-day deadline to five days or even less," and the Iranian delegation discussed this proposal during its visit to Qatar. Iran has now agreed to a "two-day plan": on the first day, the United States would take a series of compliance measures; on the second day, the Strait of Hormuz would reopen and traffic through the strait would return to its previous state.
Araghchi noted that all these issues are now on the table, and that as long as the United States abides by Iran's two-day plan, it could pave the way for peace and restore normal conditions in the Strait of Hormuz. Only after the United States fulfills its commitments and the Strait of Hormuz reopens would the path to resuming negotiations between Iran and the United States open up.
The conditions Iran has set for U.S. compliance reportedly include establishing new shipping routes through the Strait of Hormuz, unfreezing Iranian funds, ending regional wars including in Lebanon, lifting the maritime blockade, guaranteeing exemptions for Iranian oil exports, and removing new U.S. sanctions imposed after the Islamabad Memorandum of Understanding.
Araghchi also said in an interview with Iranian media on November 1 that Iran is prepared on both the defensive and diplomatic fronts, and that which path is chosen depends on whether the U.S. side is rational. He said Iran hopes the United States will remain rational and prioritize diplomacy over other approaches, adding that Iran's deputy foreign minister recently led a delegation to Qatar to continue discussions with Qatari mediators, and that no negotiations with the U.S. side were ever arranged during this visit.
Trump Says He Does Not Want Israel's Prime Minister to Interfere in U.S.-Iran Talks
On November 1, Israeli and U.S. sources said that U.S. President Trump and Israeli Prime Minister Netanyahu held a "direct and sharp" phone call on October 31 about the U.S.-Iran negotiations, according to CCTV News. The sources said Netanyahu urged Trump to "immediately resume the war against Iran" after the U.S. midterm elections on November 3, and expressed concern about the ongoing U.S.-Iran talks being mediated by Qatar.
Trump at this stage wants to "let the negotiations fully play out" and does not want Israel to disrupt the process. It is reported that if the talks fail, Trump's position could shift "significantly." Both the White House and the Israeli Prime Minister's Office declined to comment on the report.
Iran's Revolutionary Guard Says Two "Non-Compliant" Tankers Struck Mines in the Strait of Hormuz
Iran's Islamic Revolutionary Guard Corps Navy said in a statement on November 1 that two "non-compliant" oil tankers struck mines and exploded while sailing along unauthorized routes in the Strait of Hormuz, according to Xinhua. The statement said one of the tankers was a supertanker.
The two tankers shut off their navigation and identification systems and, with U.S. military support, attempted to pass secretly along unauthorized routes inside the Strait of Hormuz.
Major Oil Producers Decide to Keep Output Unchanged in December
OPEC said in a statement on November 1 that seven major "OPEC+" oil-producing countries decided to keep current crude oil production unchanged in December, according to Xinhua. The statement did not mention the reason for keeping output unchanged, but media reports said "OPEC+" producers are still working to cope with export disruptions caused by the Middle East conflict and therefore will not make further policy adjustments before next year.
Each producing country needs to complete a production capacity assessment in the fourth quarter to determine its 2027 production quota.
Oil Prices Plunge at the Open
On November 2, after the international crude oil market opened, both New York crude oil futures and Brent crude oil futures opened lower. As of press time, they were down 1.67% and 1.5%, respectively.
Container Freight Index (Europe Route) Futures Tumble
Last week, the container freight index (Europe route) futures continued to weaken. On a weekly candlestick basis, the main 2612 contract posted two consecutive weekly declines, falling 12.89% for the week.
Chen Zhen, a macro finance and shipping analyst at Founders Mid-Term Futures, said weak fundamentals were the main reason for the sharp drop in the container freight index (Europe route) futures. According to Chen, spot quotations showed that Maersk's opening price for week 46 fell by $200/FEU month on month to $3,000/FEU. The lowest offline quotations from the Premier Alliance, Hapag-Lloyd and Mediterranean Shipping Company all fell below $3,000/FEU, while only the OCEAN Alliance's offline quotation remained above $3,000/FEU. "This reflects that shipping companies' earlier expectations for price increases failed to materialize effectively," he said.
"The demand side is also under pressure," Chen said. Riots broke out in many parts of Europe, and France even imposed curfews, weakening consumer confidence. Data showed that the EU consumer confidence index came in at -17.3 in October, a new low in nearly five months, while the UK GFK consumer confidence index came in at -24, a new low since December 2023.
"On the supply side, shipping companies are actively pushing for the resumption of navigation through the Suez Canal, and vessel turnaround efficiency will improve in the future, further weighing on freight rates," Chen said.
The reporter noted that entering November, shipping companies once again released signals of price increases. CMA CGM and Maersk successively issued rate increase notices, raising rates for the second half of November to $4,600/FEU and $4,000/FEU, respectively. However, Hapag-Lloyd's quotation for the same period was $2,735 to $3,235/FEU. There are clear differences among shipping companies' quotations.
Chen said the market is not very optimistic about the implementation of a new round of shipping company price increases. "November is the traditional off-season for Asia-Europe route transportation. The shipping period for Christmas holiday goods has passed, and there is still some time before the pre-Spring Festival shipping peak, both of which are unfavorable for shipping companies' price increases to take effect. Shipping companies are more likely to push for rates to stop falling or rise slightly in the second half of November," he said.
Looking ahead, Chen said that in order to advance next year's contract negotiations and as December gradually enters the pre-Spring Festival shipping peak, shipping companies may still continue to issue rate increase notices. However, with the progress of Red Sea navigation resumption and the improvement in vessel capacity turnover efficiency, the rebound space for container freight index (Europe route) futures may be limited.
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