Trump extends US-Iran ceasefire indefinitely, shifts focus to economic pressure

Trump extended the US-Iran ceasefire indefinitely, shifting focus to economic pressure. The likelihood of the ceasefire ending soon now sits at ? YES.

Market reaction

The removal of a fixed deadline has reshaped the ceasefire end market. Without an end date, there is no trigger for immediate military action, and odds for the ceasefire ending are expected to drop sharply. The permanent peace deal by April 30 market has plummeted to 5.5% YES, down from 20% just a day ago.

Why it matters

The term structure tells the story. The May 31 market sits at 28.5% YES, while the largest moves occurred at the short end, meaning traders expect prolonged diplomatic engagement rather than a quick resolution. The June 30 market order book requires $12,620 to move the price 5 points, confirming real liquidity behind that view.

The indefinite ceasefire also lowered expectations for oil price spikes. Odds of WTI hitting $160 in April sit at 0.9% YES as geopolitical risk fades.

The ceasefire represents a shift toward economic measures over military conflict, a strategy aimed at exhausting Iran’s resources without direct confrontation. For traders, this moves the action from short-term military bets to longer-term diplomatic timelines. Buying YES at 5.5¢ offers a 18x return if a deal is struck by end of April, but that requires a diplomatic breakthrough within a week.

What to watch

Statements from Trump or US envoys Jared Kushner and Steve Witkoff. Their communications would signal whether this indefinite ceasefire is a prelude to a broader peace framework or a strategic pause.

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