MW What's at stake for markets as the U.S. and Iran talk this weekend
By Victor Reklaitis and Myra P. Saefong
An American delegation led by Vice President Vance is slated to meet with Iranian officials Saturday
Will the cease-fire hold? An antiwar demonstrator holds up a sign with a symbol of peace on Tuesday near the White House while protesting the war in Iran.
The Iran war has jolted oil prices and stocks over the past six weeks, leaving investors on edge over negotiations slated for this weekend.
Yet the likely outcome of the talks between the U.S. and Iran will be largely a continuation of the current state of affairs - and that should, at least, not rattle markets, according to a range of analysts.
Those forecasts come as a U.S. delegation led by Vice President J.D. Vance is slated to meet with Iranian officials in the Pakistani capital of Islamabad starting on Saturday, after the two countries agreed on Tuesday to a two-week cease-fire.
The cease-fire deal is widely viewed as fragile, as there has been disagreement over whether Israel's attacks on Iran's allies in Lebanon represent a violation of the temporary truce. In addition, President Donald Trump has complained that Iran "doing a very poor job" of honoring a key part of the deal - allowing oil tankers to go through the Strait of Hormuz. The strait is a crucial Mideast shipping route that Iran now controls and wants to turn into a tolled waterway, while signaling that it has placed underwater mines in key parts.
This weekend's talks are "unlikely to result in a formal agreement," but "as long as Iran allows goods to resume transiting the strait, even under its control and with a new toll applied, we believe this will be sufficient for the White House to declare victory and move on for good," said analysts at Beacon Policy Advisors in a note.
"The eventual outcome of these talks is likely to closely resemble the current status quo, where attacks on Iran and by Iran have ceased, and Iran has effectively gained control of the strait," the analysts added.
They said one sign that Trump himself wants to move on from the Iran war is his plan to travel to Arizona and Nevada next week to tout the tax cuts that he and his fellow Republicans enacted last year. The Beacon analysts predict Trump won't take take action to contest Iran's claim of control over the strait, even though his rhetoric suggests otherwise. The president told the New York Post on Friday that American warships are being reloaded with ammunition to resume strikes on Iran if the talks in Pakistan fail.
Analysts at Evercore ISI also aren't expecting big developments from this weekend's negotiations.
"Even if the Lebanon issue can be clarified, we don't expect any breakthroughs from the U.S.-Iran meeting, as the U.S. and Iran remain extremely far apart on substantive issues," said the Evercore analysts, led by Sarah Bianchi, a former deputy U.S. trade representative.
"Given the deep mutual distrust and Iran's well-established tendency to prolong negotiations, the likelihood of a comprehensive agreement is next to zero. That said, our base case - and likely the best possible near-term outcome - is an agreement to continue the dialogue, potentially accompanied by a set of high-level principles to guide future discussions."
The cease-fire probably will need to be extended beyond two weeks because of the tough issues that need to get worked out, according to Evercore's team.
What a bad outcome would look like
A bad outcome for this weekend's meeting would be marked by collapsed talks over the Lebanon issue or over shipping disputes, said Neil Crosby, head of oil research at Sparta Commodities, in an email. That would likely trigger U.S. strikes on Iranian energy infrastructure and potentially another total Iranian lockdown of the Strait of Hormuz, causing oil prices to "violently spike," Crosby said.
The two main oil benchmarks, Brent (BRN00) and West Texas Intermediate (CL00), traded around $120 a barrel last month as the conflict escalated, putting pressure on U.S. stocks and other markets. But oil prices have tumbled since Tuesday's cease-fire, while the S&P 500 SPX U.S. equity benchmark has surged, though it remains below where it stood before Feb. 28. That's the date when America's joint attacks with Israel on Iran began.
Related: Has the cease-fire rally pushed stocks too high, too quickly?
A good outcome for this weekend's meeting would involve negotiators securing a "verifiable halt to regional strikes," along with the removal of mines from the strait, said Sparta's Crosby. That would make oil prices plunge because a massive premium from geopolitical risks would evaporate, he said.
Vance sounded somewhat upbeat about the talks in Pakistan as he spoke to reporters on Friday just before his departure - though he warned Iran as well.
"We're looking forward to the negotiation. I think it's going to be positive," said the vice president, who is known for being skeptical of military interventionism.
"As the president of the United States said, if the Iranians are willing to negotiate in good faith, we're certainly willing to extend the open hand," Vance said. "If they're going to try to play us, then they're going to find that the negotiating team is not that receptive."
-Victor Reklaitis -Myra P. Saefong
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April 10, 2026 15:36 ET (19:36 GMT)
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