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Them's Fightin' Words
By Benjamin Picton, Rabobank Senior Market Strategist
ResignedBrent crude front-month futures are inching higher this morning after ending May down almost 20%. The May selloff has been courtesy of Mr Market’s Pavlovian response to fresh peace rumours, though it still remains the case that a deal has not been done and the Strait of Hormuz remains closed.
US equity indices closed higher across the board on Friday, but Asian stocks are mixed in early trade today. The S&P500 has now had nine-consecutive positive weekly closes and is sitting at a fresh all-time-high, with futures pointed at further gains when markets open later today.
While crude futures are lower, spot prices for Malaysian Tapis crude are proving a little more sticky and are still trading around the levels seen through late May and early April. Singapore gasoil (diesel) spot prices are testing support at $135/bbl, but even at those short-term lows prices are way above the $90.41/bbl recorded on February 26th (the last close before the war started) or the January prices in the high $70s, before the market started to price in what two carrier groups in the Middle East might mean.
Gold prices rose by 0.68% last week. This was the first positive weekly close since May 8th, and another example of markets respecting the $4,500/oz support level. Gold is now trading at levels similar to those seen in late December and early January as a number of central banks liquidated holdings in a scramble for Dollar liquidity earlier in the Hormuz crisis.
Sovereign yields are moving higher this morning after falling for much of last week. US 2-year yields are up 2bps to 4.04% in early trade, Aussie 2s are up 4bps to 4.56%, but New Zealand 2s are curiously flat after a hawkish RBNZ last week and a national budget that showed fiscal tightening will be delayed beyond the 2026/27 financial year. Moves at the longer end are even more pronounced, with 10-year Treasury yields up 3bps to 4.47%.
The shift higher in crude and yields could be a sign of markets beginning to resign themselves to the idea that a deal will remain elusive in the short term. The creep from “any minute now” this time last week to “maybe, or maybe not” is underway. Regular readers will know that RaboResearch updated our baseline view on the Hormuz crisis last week to suggest that the Strait is likely to remain mostly closed through to September as the parties to negotiations find that their red lines over Iran’s nuclear program are (still) incompatible, and the Iranians realise that giving up their oil market leverage would be a foolish thing to do.
A bad sign arrived this morning with the news that Iranian President Pezeshkian had offered his resignation to Supreme Leader Khamenei. Pezeshkian has reportedly claimed that he is unable to run the government and carry out his responsibilities, because the civilian government has been sidelined by the hardliners in the IRGC – the guys with the guns. This is a new angle on the view that various factions in Iran are competing with each other, and that there are large disagreements on how negotiations with the US should be handled, or if they should be happening at all.
Donald Trump raised some eyebrows yesterday when he said that the Iranian military (the Artesh) is ‘moderate’ and had been left alone during American strikes. This places Pezeshkian, foreign minister Araghchi, and possibly parliamentary speaker Ghalibaf (newly re-appointed) alongside the Artesh in the ‘moderate’ camp willing to do a deal, while the IRGC resists agreement with the US and insists on Iran’s rights over Hormuz and the progress of its nuclear program. We think that it will take longer yet before the IRGC sees eye-to-eye with the moderates, and that a continued closure with risks of further strikes is more likely than an agreement that is amenable to all and satisfies Donald Trump’s need to sign something that looks better than Barack Obama’s JCPOA. Of course, it may be the case that the much-maligned JCPOA was maligned for a reason. To paraphrase Solon of Athens, the JCPOA might not have contained the best terms, but it might have contained the best terms all parties could be induced to accept.
While the Hormuz issue drags on, the Ukraine war also continues to percolate and threatens to spread into Europe. Ukraine is deepening cooperation with EU states over drone technology, which has been used to great effect against Russian energy targets in recent months. Meanwhile, a Russian drone reportedly struck an apartment building in NATO member country Romania late last week.
Former Russian President and close Putin ally Dmitry Medvedev took to X to warn “Citizens of EU countries, You should realize your authorities have unilaterally entered into a war with Russia. So be vigilant and don't be surprised by anything. The peaceful sleep is over...” To quote Yosemite Sam: “them’s fightin’ words”.
Citizens of EU countries, You should realize your authorities have unilaterally entered into a war with Russia. So be vigilant and don't be surprised by anything. The peaceful sleep is over. But you know who to ask why!
— Dmitry Medvedev (@MedvedevRussiaE) May 29, 2026Clearly the Kremlin is not happy that Europe is continuing to support Ukraine in a conflict that some analysts are now saying has turned in the latter’s favor.
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'Los Gatos Party Mom' Sentenced To 35 Years For Throwing Drunken Teen Parties
Authored by Dylan Morgan via The Epoch Times,
A Los Gatos, California, woman was sentenced on May 28 to 35 years and 10 months in prison, the maximum allowed, for hosting parties for young teenagers where she brought alcohol and egged on sex acts.
Shannon O’Connor, 52, threw these parties for two years and discouraged teens, who were mostly 14 and 15 years old, from telling their parents or police about the parties or calling for help when one of the victims passed out in their own vomit.
“Many people call this defendant the ‘Los Gatos Party Mom.’ This isn’t some fun parent giving sips of wine spritzers to kids. She facilitated dangerous and drunken sex acts with these children. She risked their lives and damaged their psyches. She is not a party mom. Shannon O’Connor is a convicted felon. Shannon O’Connor is a registered sex offender,” Santa Clara County District Attorney Jeff Rosen said.
O’Connor, also known as Shannon Burga, was convicted of 48 charges, including child abuse charges and two felony sex charges, in March.
Twenty young adults and 41 witnesses testified during the trial.
Thursday’s sentencing followed two days of testimony from the victims on O’Connor’s teen parties she hosted for two years, including one young woman who told the court she became suicidal from trauma induced by the parties.
At one party, O’Connor handed an underage teenager a condom and pushed him into a room with an intoxicated minor.
At a separate New Year’s Eve party with about five 14-year-olds, O’Connor watched and laughed as a drunk teen sexually battered a young girl in bed.
In another incident, O’Connor brought a drunk teen into a bedroom where an intoxicated 14-year-old girl was lying in bed, according to prosecutors.
After the girl was assaulted, she said to O’Connor, “Why did you leave me in there with him? Like you knew, like what he was going to do to me.”
In another case, O’Connor let a minor drive her SUV in the Los Gatos High School parking lot while two other teens held onto the back, and one was knocked unconscious after falling off.
In some cases, she would text teens or message them on Snapchat to leave their homes in the middle of the night and drink at her house, where she would provide alcohol.
“[O’Connor] endangered their safety, coordinated their sexual assaults, and she tried to get them not to tell,” Rosen said. “These brave kids came forward to tell the truth about what happened and to put a stop to it.”
Tyler Durden Mon, 06/01/2026 - 11:15