The Japanese yen fell in Asian trading on Monday against a basket of major and minor currencies, continuing its losses for the third consecutive day against the U.S. dollar, amid renewed buying operations of the American currency as the best alternative investment, especially after the collapse of peace talks between the United States and Iran in Pakistan. 

With the escalation of U.S. threats to impose a naval blockade on the Strait of Hormuz and Iranian ports, global oil prices jumped by more than 10%, in a development that brings concerns of accelerating global inflation back to the forefront and increases pressure on central banks to take steps closer toward raising interest rates in the near term. 

Price overview 

- Japanese yen exchange rate today: The dollar rose against the yen by nearly 0.4% to (159.85¥), from Friday's closing price at (159.24¥), and recorded a low during today's trading at (159.50¥). 

- The yen ended Friday's trading down by 0.2% against the dollar, in its second consecutive daily loss. 

- Last week, the yen achieved an increase of 0.2% against the dollar, its second consecutive weekly gain, thanks to the agreement between the United States and Iran on a two-week ceasefire, which included opening the Strait of Hormuz to global navigation. 

The U.S. Dollar 

The dollar index rose on Monday at the start of the week's trading by 0.5%, beginning a broad recovery from its lowest levels in a month, reflecting the rise in the levels of the American currency against a basket of global currencies. 

Aside from buying operations from low levels, U.S. dollar levels rose due to fears of renewed war in the Middle East region after the collapse of peace talks between the United States and Iran in Pakistan. 

Saul Kavonic, an analyst at MST Marquee, said: The market has now largely returned to its status before the ceasefire. 

Updates on the Iranian war 

- The talks between the United States and Iran in Islamabad ended in a deadlock. 

- Washington's insistence on a complete dismantling of what remains of uranium enrichment facilities in Iran. 

- Tehran's demand for an immediate lifting of all economic sanctions before extending the truce. 

- Trump says that the United States will impose a blockade on the Strait of Hormuz after the failure of peace talks with Iran. 

- Trump ordered the U.S. Navy to impose a blockade on the Strait of Hormuz starting at 10:00 AM U.S. Eastern Time on Monday. 

- Trump believes that Iran will continue the dialogue; Tehran seeks a "balanced and fair agreement." 

- Iran warns of a harsh response to the blockade and accuses the United States of being intransigent in negotiations. 

- The Wall Street Journal reported that Trump and his advisors are considering launching limited strikes on Iran. 

Global oil prices 

Oil prices jumped by more than 10% on Monday, after the failure of U.S.-Iranian talks to reach an agreement, leaving the fragile ceasefire hanging and continuing to choke energy exports from the Middle East. 

Undoubtedly, the rise in global oil prices renews fears of accelerating inflation, which may push global central banks to raise interest rates in the near term, in a sharp shift from pre-war expectations of cutting or fixing interest rates for a long period. 

Japanese interest rates 

- The pricing of the probabilities of the Bank of Japan raising interest rates by a quarter of a percentage point in the April meeting is currently stable around 10%. 

- In order to re-price those probabilities, investors await the release of more data on the levels of inflation, unemployment, and wages in Japan.

Soybean prices rose during mid-day trading on Friday, recording gains ranging between 7 and 13 cents, supported mainly by a rise in soybean meal and technical purchases. The national average cash price for soybeans also rose by about 13 cents to reach $11.10 and a quarter.

Soybean meal futures experienced a strong rise ranging between $12 and $15 during the mid-session, while soybean oil contracts declined by about 50 to 53 points.

The United States Department of Agriculture announced a private export deal to sell 100,000 metric tons of soybean meal to Italy this morning.

Export sales data released on Thursday showed that total export commitments reached 37.905 million metric tons, a decrease of 18% compared to the same period last year. This level represents about 90% of the USDA's new estimates, which is lower than the usual average pace of 95%.

Actual shipments reached 30.52 million metric tons, equivalent to 73% of the department's estimates, which is also lower than the usual performance average of 84%.

In the monthly World Agricultural Supply and Demand Estimates (WASDE) report, the USDA revealed some adjustments in demand forecasts, as the crushing volume was raised by 35 million bushels, while exports were reduced by the same amount, keeping total ending stocks unchanged at 350 million bushels.

The expected average cash price was also raised by 10 cents to reach $10.30.

As for the May 2026 futures contracts, soybean prices recorded $11.78 and a quarter, an increase of 13 cents.

A common idea persists within the energy sector that American refineries are "unable" to process the light, low-sulfur crude oil resulting from the shale oil boom. This claim often surfaces whenever gasoline prices rise or talk of U.S. energy independence returns. The argument is based on the fact that the United States produces record amounts of oil, yet continues to import crude because its refineries were primarily built to process heavier types of imported oil. 

This narrative appears convincing at first glance, but it is largely inaccurate. 

American refineries are indeed capable of processing shale oil and do so daily. The problem is not technical capacity, but rather economic considerations. Understanding this difference is extremely important, because it explains why the United States simultaneously exports large quantities of crude oil while continuing to import it, and why this system operates much more efficiently than it appears at first glance. 

A big bet on heavy oil 

The roots of this confusion go back decades. From the 1980s until the early 2000s, refining companies pumped in massive investments based on a clear market trend at the time: that high-quality, easy-to-refine oil was gradually diminishing. It was expected that future supplies would be heavier, meaning they contain longer and more complex hydrocarbon molecules, in addition to containing more sulfur. 

In response, refining companies spent tens of billions of dollars to upgrade their facilities by installing coking units, hydrocracking units, and desulfurization units—equipment designed to process heavy, high-sulfur oil that is difficult to convert into finished products. 

These investments turned U.S. Gulf Coast refineries into the most sophisticated in the world. They became capable of buying low-priced heavy oil from countries like Canada, Mexico, and Venezuela, then converting it into high-value products such as gasoline and diesel. This gave American refineries a sustainable competitive advantage known in the industry as the "complexity premium." 

The shale oil boom changed the equation 

But the shale oil revolution completely flipped the equation. 

Instead of a shortage of light oil, the United States suddenly found itself flooded with it. Shale oil extracted from regions like the Permian Basin is characterized as being light and low in sulfur, making it easier to refine. 

On the surface this seems ideal, but it creates a kind of mismatch for highly complex refineries. These facilities were designed primarily to achieve maximum value from heavy oil, and when they process large quantities of light oil, they begin to lose this advantage. 

Why does running shale oil reduce efficiency? 

When a refinery designed to process heavy oil runs a large percentage of light shale oil, two main problems appear. 

First, sophisticated processing units such as coking units and hydrocracking units become underutilized. These assets, which cost billions of dollars, were designed to break down heavy molecules, while light oil does not contain enough of those molecules to keep the equipment operating at high efficiency. 

Second, operational bottlenecks may appear within the refinery. Light oil produces a larger volume of light products, which may put pressure on other parts of the refining system and force the refinery to reduce its total capacity. 

Thus, the refinery remains capable of operating, but it operates with less efficiency and weaker profitability. 

Economics, not technical capacity 

The difference between "capacity" and "feasibility" here is of paramount importance. 

American refineries are fully capable of processing shale oil. However, total reliance on light oil would lead to the erosion of profit margins due to the idling of high-value equipment, and would also lead to lower efficiency and production. 

Therefore, refineries practically rely on a blend of crudes. They mix locally produced light oil with imported heavy oil to achieve maximum production and profitability. 

At the same time, surplus American shale oil is exported to refineries in Europe and Asia that are more suitable for processing it efficiently. Many refineries around the world did not invest huge sums to upgrade their capabilities to process heavy, high-sulfur oil, and therefore American shale oil is a suitable option for them despite its higher cost. 

In this way, the system works exactly as it is supposed to. 

Why might a ban on exports be a mistake? 

Calls to restrict or ban crude oil exports often stem from the belief that doing so will lead to lower gasoline prices. 

But the reality may be the opposite. If American refineries are forced to rely more heavily on light shale oil, their efficiency will decline, and fuel supplies may shrink, ultimately leading to higher costs. 

Furthermore, the global oil market is deeply interconnected, and any attempt to artificially restrict it often leads to unexpected results. 

What may appear as a contradiction—importing and exporting crude oil at the same time—is in truth a sign of optimizing efficiency. Different types of oil flow to the refineries most capable of processing them, achieving the maximum possible value for the entire system. 

The difference between myth and reality 

The idea that American refineries "cannot" process shale oil is a myth that has persisted because it sounds logical. But it actually confuses technical capacity with economic reality. 

American refineries are capable of processing shale oil, and they already do so. But they simply achieve fewer profits when they rely on it completely. 

In the refining industry, as in any business activity, the question is not always whether it can be done, but whether it is economically logical to do it.

The S&P 500 and Nasdaq Composite indices rose slightly on Friday supported by gains in technology stocks, after March inflation data came in line with expectations, despite continued pressures resulting from the conflict in the Middle East, while investors evaluate the tense truce between the United States and Iran. 

Data showed that consumer prices in the United States recorded their largest increase in nearly four years during the month of March, with oil prices rising due to the war and the continued pass-through of the impact of tariffs to prices. 

However, traders held on to their expectations that the Federal Reserve will keep borrowing costs unchanged this year, according to data compiled by the London Stock Exchange Group, retreating from their previous expectations which indicated two interest rate cuts during the year before the outbreak of the conflict. 

Brett Kenwell, U.S. investment analyst at eToro, said that the clear message when looking at inflation data alongside the Personal Consumption Expenditures (PCE) index data released on Thursday is that inflation remains stubborn, even with an optimistic assumption that the rise in energy prices will be a temporary pressure factor rather than a permanent shift in prices. 

He added that this may push policymakers to wait before taking any decisions, unless a more clear deterioration appears in the labor market or in the broader economy. 

In the same context, Mary Daly told Reuters on Thursday that the oil price shock resulting from the war with Iran may prolong the period of time necessary to return inflation to the central bank's target of 2%. 

By 10:15 AM U.S. Eastern Time, the Dow Jones Industrial Average fell by 109.60 points or 0.23% to reach 48,076.20 points, while the S&P 500 index rose by 10.56 points or 0.15% to 6,835.22 points, and the Nasdaq Composite index climbed by 123.70 points or 0.54% to reach 22,946.11 points. 

The information technology sector in the S&P 500 index was the largest supporter of the gains, as it rose by about 0.8% led by electronic chip manufacturing companies. Nvidia stock rose by 1.8%, while Broadcom stock increased by 4.4%. The Philadelphia SE Semiconductor Index also recorded a new record high of 8,926.08 points. 

But the weakness of financial sector stocks limited the gains of the benchmark index, as the sector declined by about 0.8%, affected by the decline in Goldman Sachs and Travelers shares, which also put pressure on the Dow Jones index. 

However, the main indices on Wall Street are heading toward achieving weekly gains, as the S&P 500 and the Dow Jones Industrial Average are on track to record their largest weekly rise since November and June respectively. 

Market sentiment during the week was supported by the two-week truce between Washington and Tehran, in addition to statements by Israeli Prime Minister Benjamin Netanyahu that he seeks to hold direct talks with Beirut. 

However, some cracks appeared in the truce mediated by Pakistan, as both parties exchanged accusations of breaching the ceasefire before the first round of talks scheduled for Saturday. 

Jeff Buchbinder, chief equity strategist at LPL Financial, said that the market has become heavily dependent on news headlines, noting that as long as the ceasefire continues and investors see a path toward a degree of stability in the Middle East, they will be able to overcome the disturbances. 

In separate data, a preliminary reading showed that the Consumer Sentiment Index issued by the University of Michigan reached 47.6 points in April, which is less than the expectations that amounted to 52 points according to a survey of economists conducted by Reuters. 

In company news, U.S.-listed shares of Taiwan Semiconductor Manufacturing Company, the world's largest contract chipmaker, rose by 2.7% after its first-quarter revenues exceeded market expectations. 

CoreWeave stock also climbed by 6.8% after announcing a multi-year agreement with Anthropic, in addition to pricing its convertible bond offering at a premium. 

Advancing stocks outnumbered declining ones by a ratio of 1.22 to 1 on the New York Stock Exchange, and by 1.07 to 1 on the Nasdaq. 

The S&P 500 index recorded 17 new 52-week highs against 18 new lows, while the Nasdaq Composite index recorded 84 new highs and 70 new lows.