US Vice President JD Vance has called off his planned trip to Pakistan, according to AP, as tensions tied to the US–Iran war escalate again.
The move signals rising uncertainty around diplomatic efforts and comes as markets react sharply to renewed geopolitical risk.
Oil prices jumped immediately following the news, extending gains tied to fears of disruption in the Strait of Hormuz.
At the same time, Bitcoin fell sharply toward the $75,000 level, while the S&P 500 moved lower on the day, reflecting a broad risk-off shift across global markets.
Crypto derivatives data shows forced selling accelerated the move. Over the past 24 hours, liquidations crossed $250 million, with a large share coming from long positions. This indicates traders were caught offside as sentiment flipped quickly.
The latest reaction fits a pattern seen throughout the past week. Markets have been tightly linked to developments in the US–Iran situation, with oil acting as the primary transmission channel.
Earlier on April 13, the US escalated tensions by moving to enforce a naval blockade near Iran, raising immediate concerns about global energy supply. Oil prices began climbing as traders priced in the risk to shipping through Hormuz.
By April 15, sentiment briefly improved after reports suggested a possible two-week ceasefire window. Stocks rallied sharply, pushing the S&P 500 to fresh highs, while oil pulled back from earlier spikes. Crypto also stabilized during this period.
However, the tone shifted again on April 16 after a US congressional vote failed to advance a war-limiting resolution.
Bitcoin dropped around 4% following the development, reinforcing its role as a macro-sensitive asset rather than a safe haven.
Tensions continued to build over the weekend. Reports of US actions targeting Iranian vessels and Iran’s response in the region kept markets on edge. Oil resumed its upward trend, while risk assets weakened.
By April 20, the divergence became clearer. Oil surged again on renewed conflict risk, while Bitcoin and major altcoins moved lower. The correlation between energy prices and crypto weakness strengthened.
The latest move on April 21 adds to that trajectory. Vance’s canceled trip suggests diplomatic uncertainty at a critical moment, and markets are reacting accordingly.
Overall, the past week shows a consistent pattern. Escalation drives oil higher and pressures both equities and crypto. Temporary de-escalation supports risk assets, but those moves have been short-lived.
