Trump talked about the US-UK trade deal, noting that the UK wants to make some “adjustments.” He mentioned this on Fox News. He also discussed sanctions, saying, “I don’t mind sanctions,” in reference to Russia.

Uncertainty for the British Pound

The UK’s desire for “adjustments” to the trade deal creates uncertainty for the British pound. We can expect more fluctuations in the GBP/USD currency pair in the coming weeks. Buying put options on the pound could be a wise move to protect against potential losses if negotiations stall. This news arrives during a tricky time for the UK economy, which is showing signs of slowing down. Last week, the Office for National Statistics reported that the UK GDP only grew by 0.1% in the second quarter of 2025. Any disruption to a key trade deal could worsen the situation. The pound has already dropped from a high of 1.28 to about 1.22 against the dollar this year, and this news could push it even lower. On a separate note, Trump’s casual mention of sanctions against Russia is raising alarms in energy markets. This talk hints at a possible increase in economic pressure, which could affect oil and gas supply chains. It might be wise to purchase call options on Brent crude futures, as new sanctions could disrupt supply and raise prices.

Geopolitical Risk Premium

We remember when Brent crude prices soared past $120 a barrel in 2022 during the initial wave of sanctions, which created big opportunities for those ready for it. Prices are now around $85 per barrel, and volatility in energy options is low, making calls a cost-effective way to prepare for another potential price spike. Just these comments could add a geopolitical risk premium to oil prices. Together, these developments suggest a time of increased global uncertainty. A shift towards safer assets might benefit the US dollar, adding more pressure on the pound and other currencies. To safeguard our portfolios, it may be wise to buy protective puts on major indices like the S&P 500, as geopolitical tensions can often lead to a sell-off in risk assets. Create your live VT Markets account and start trading now.

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