strikeJul 23, 2026

Live updates: US-Iran strikes; conflict widens with Houthis claiming Red Sea attacks | CNN

Summary

Here's the latest • Widening conflict: Yemen’s Iran-backed Houthis claimed to have struck two Saudi oil tankers in the Red Sea Thursday following their Monday announcement of a naval blockade on Saudi ships. Global oil prices rose to over $98 a barrel on the news. • Ongoing threats: US Secretary of State Marco Rubio described President Donald Trump’s Iran policy as “a head for an eye,” after Iran’s top diplomat Abbas Araghchi called the country’s defense doctrine “an eye for an eye.” Trump has said the US will destroy a bridge or power plant every time Iran targets a ship in the Strait of Hormuz. • Fresh attacks: Iran fired four missiles toward Jordan on Thursday, three of which were intercepted, the country’s armed forces said. US strikes on Iran killed two people at a border crossing with Iraq, Iranian state media reported. UK warns against all but essential travel to Kuwait and Bahrain Britain’s Foreign Office has warned against all but essential travel to Kuwait and Bahrain, citing the “unpredictable” situation in the Middle East, as Tehran and Washington trade daily strikes. Both Persian Gulf nations have faced repeated Iranian attacks in recent weeks amid the latest spike in regional violence. The new travel advice published Thursday comes shortly after the UK announced it had temporarily withdrawn its staff from Iran. Another oil snafu: Insurers may ditch ships that pay Iran a toll Insurance companies can cancel policies for ships that pay tolls to Iran or any other country to transit the Strait of Hormuz, a major trade group announced Thursday, injecting a new layer of uncertainty atop the oil market quagmire that the Iran war has unleashed. Lloyd’s Market Association, a group representing maritime insurance underwriters, said in a newly drafted clause for shipping policies that paying a toll to Iran directly or via any of its agents is illegal. If ships pay the toll, it can void the ship’s entire insurance policy. LMA said insurers can apply a blanket policy about tolls so agents don’t need to figure out who is ultimately getting the money in the end. That could include the United States, after President Donald Trump briefly suggested the country could also impose tolls before abandoning that plan. But LMA’s clause is just guidance, and agents and shipping companies can draft policies as they see fit. That could nevertheless significantly complicate an already convoluted situation in the Strait of Hormuz: Iran has fired on vessels that attempt to enter or exit the Persian Gulf by hugging the Omani coast. Iran wants ships to transit the strait close to its coast so it can register them and impose tolls. But the United States and other countries have imposed sanctions on Iran, so doing business with the regime would violate the law, LMA said. That leaves shipping companies with few good options — especially as the Houthis have announced a blockade of the Bab al-Mandeb strait, leaving few remaining paths for Middle Eastern oil to get to its customers. What we know about the two Saudi tankers attacked in the Red Sea Yemen’s Iran-backed Houthis claimed early Thursday to have struck two Saudi oil tankers in the Red Sea, in what appears to be the group’s first enforcement action of its recent threat to blockade Saudi ships. Here’s what we know about the tankers: The Houthis, one of Iran’s principal allies in the region, identified the vessels as the Encelia and Layla. Both are Saudi-flagged, according to maritime tracking agency MarineTraffic. The Layla (identified by its unique International Maritime Organization number 9336098) is listed as a laden crude oil tanker, while the Encelia (IMO 9240172) is identified as a laden oil products tanker, MarineTraffic said. The vessels were struck in separate attacks approximately 70 nautical miles (around 80 miles) off the Saudi coast, maritime risk consultancy Marisks said Thursday. The Encelia sustained damage after being hit by a projectile, Marisks said, while the Layla was also “targeted.” Satellite imagery from NASA appears to show the Encelia on fire in the Red Sea. There is a risk the Houthis “may broaden their interpretation of ‘Saudi-linked shipping’ to include foreign-flagged vessels trading with Saudi ports, carrying Saudi cargoes or operating under Saudi commercial interests,” Marisk added. The UK Maritime Trade Operations (UKMTO) center said a tanker had been struck 70 nautical miles (around 80 miles) southwest of the Saudi Arabian town of Al Shuqaiq, but it did not provide the vessel’s name. Meanwhile, Saudi Press Agency said the Encelia was “targeted while sailing in the Red Sea,” causing “a fire on the vessel’s bow,” citing an unnamed official at the General Transport Authority. In its report, it did not comment on the Layla. CNN’s Eleni Giokos contributed reporting. US claims Iran is “begging” for a deal, as Tehran warns of “unlawful” threats. Catch up US Secretary of State Marco Rubio insisted on Thursday that Tehran is “begging” the Trump administration for a peace agreement, after reporters pressed him on the president’s threat to destroy Iranian bridges and power plants this week. Rubio doubled down on those comments, describing Trump’s move as “a head for an eye,” refering to Iran’s threat to take “an eye for an eye.” He further claimed that Iranian officials “haven’t come to their senses” and are “clearly not ready to make a deal.” An act of targeting civilian infrastructure could be considered a war crime. Iran’s Foreign Ministry spokesperson, Esmaeil Baqaei, warned that Trump’s repeated threat to destroy Iranian bridges and power plants is “manifestly unlawful and criminal.” That war of words escalated as both parties try to wrest control of shipping in the Strait of Hormuz – and now the Red Sea, opening up a new front of regional violence. Here’s what you need to know: - US strikes kill two people at Iran border: Two people were killed and 11 others injured after Washington launched a salvo across southern and western Fifty-three people have been killed by US strikes on Iran since July 6, the Iranian Ministry of Health said on Thursday. - Iran fires on regional nations: The Iranian military launched four missiles toward Jordan early Thursday, three of which were intercepted, according to the Jordanian Armed Forces. Further east, sirens also sounded across Bahrain, the country’s interior minister said. - New US-Saudi deal will have safeguards, says Rubio: The Secretary of State sought to allay concerns over a fresh nuclear pact between Riyadh and Washington, telling reporters in Manila that the Gulf ally was a “strategic partner.” He insisted there will be “safeguards in place to ensure that it can’t be turned into a weapons program.” - Oil prices peak: The cost of Brent crude, the international benchmark, rose by 4% passing $98 a barrel early morning ET on Thursday, after the Iran-backed Houthis attacked two Saudi Arabian oil tankers in the Red Sea. Iran foreign minister’s "eye for an eye" comment shows how Tehran will respond to attacks Iran’s Foreign Minister Abbas Araghchi says Iran’s defense doctrine is an “eye for an eye” retaliation against any attack on its infrastructure. In a post on X Tuesday, he said any aggression against Iran, including its infrastructure, would compel a powerful and decisive response. The comments came in response to threats from Washington to bomb a bridge or power plant for every ship targeted in the Strait of Hormuz, after US President Donald Trump warned of strikes on Iranian infrastructure amid the ongoing standoff over shipping through the strait. Araghchi’s post aligns with the message being sent by Iran’s top military brass. The IRGC’s commander, Brigadier General Seyyed Majid Mousavi, said any US attack on Iranian bridges or power plants would be met with immediate retaliation, warning that it would cut electricity to US allies hosting American forces in the region. Just about a week ago, Iran’s IRGC-linked news outlets also said that the Revolutionary Guards would “respond in kind” to any American attacks or escalations and would respond proportionally to US aggression. Iran has long favored what it believes are calibrated, proportional responses over open-ended escalation. Its 2020 ballistic missile strikes on US forces at Iraq’s Ain al-Asad base, following the killing of General Qasem Soleimani, were widely seen as designed to inflict a symbolic, measured blow rather than trigger all-out war. They also implemented this strategy in 2024 and 2025. US-Saudi nuclear pact could undermine Iran talks, expert warns The US-Saudi nuclear agreement could undermine US efforts to rein in Iran’s nuclear ambitions, a former Pentagon advisor has warned. US President Donald Trump approved a nuclear deal with Saudi Arabia on Wednesday that could lead to the kingdom enriching its own fuel for civilian reactors and bypassing international nuclear watchdogs. Any agreement to give Saudi Arabia access to nuclear technology could prove controversial, both in the US and across the Middle East, since the ability to enrich nuclear fuel could, in theory, eventually lead to the creation of nuclear weapons. “Iran is likely to point at this deal and ask: If the US is having these conversations with Saudi Arabia, why are they imposing such standards on us,” former Pentagon advisor Jasmine El Gamal told CNN’s Polo Sandoval. El Gamal said the US-Saudi Arabia agreement, also known as the 123 agreement, could “set a precedent,” given Washington’s ambitions of restricting Iran’s nuclear capabilities. Both sides agreed to discuss Tehran’s nuclear program under the Memorandum of Understanding that was signed in June but later fell apart. Oman calls for de-escalation in Red Sea region amid Houthi attacks Oman called for de-escalation in the Red Sea region today after Yemen’s Iran-backed Houthis attacked two Saudi oil tankers in the area, as the Iran conflict widens. The ministry expressed the need to “avoid escalation and any threats that could exacerbate the situation and endanger freedom of navigation.” The Houthis, one of Iran’s principal allies in the region, have long warned they could take action to block the Bab al-Mandeb Strait, a chokepoint at the southern end of the Red Sea. Earlier this week, the group declared a maritime blockade on Saudi shipping, an escalation that could further threaten global oil supplies. Jordan says its air defenses intercepted Iranian missile attacks Iran fired four missiles toward Jordan this morning, three of which were intercepted, according to the country’s armed forces, as Tehran continues its retaliatory strikes across the region. Jordan’s air defenses “intercepted and shot down three missiles this morning, while the fourth missile landed in a remote, uninhabited area,” the armed forces said in a statement. There were no deaths or injuries, it added. The fresh strikes follow six missiles Iran fired on Jordan on Wednesday. Satellite imagery captured by the European Space Agency appears to show smoke rising from a building on the King Faisal Air Base in Jordan. In Bahrain, citizens were urged today to “remain calm and head to the nearest safe place” as siren sounded across the country. Rubio assures new US-Saudi nuclear program will have safeguards A newly approved deal that could lead Saudi Arabia to enriching its own fuel for civilian nuclear reactors has raised some concerns among observers, but US Secretary of State Marco Rubio on Thursday assured the US-backed deal would have safeguards in place. “When countries decide that they want to pursue a peaceful, civil nuclear program, we’d prefer them do it with us, (rather) than do it with some other country. It allows us to have influence over the direction that it goes.” Rubio told reporters from the ASEAN summit in Manila. Rubio stressed that Riyadh was a “strategic partner” and that the agreement made sense. The agreement, which was approved by President Donald Trump on Wednesday, will next go to Congress for a mandatory review. Rubio says Iran "begging" US to make a deal, adds Trump's policy is "a head for an eye" US Secretary of State Marco Rubio on Thursday was asked about President Donald Trump’s recent threats to “bomb and destroy” a bridge or power plant every time Iran targets a ship in the Strait of Hormuz. Addressing reporters at a gaggle on the sidelines of the ASEAN summit in Manila, Rubio claimed, “Iran is begging us, both directly and indirectly: ‘Let’s do a deal. Let’s talk. Let’s talk.’” He added that every time the US and Iran agree on a ceasfire deal “the people that are in charge there, they either break it or they want to change it.” “So they’re going to continue to pay a price, and they’re going every night the price gets higher and higher and higher,” he added. Iran’s top diplomat Abbas Araghchi recently described the country’s defense doctrine as “an eye for an eye.” “Any aggression against Iran, including our infrastructure, will compel a powerful and decisive response,” Araghchi said on X late Wednesday. Oil at nearly $98 a barrel, a 7-week high, as Houthis target Red Sea tankers Global oil prices rose sharply on Thursday, almost hitting $98 a barrel, as Iran-backed Houthi militants threaten to open a new front in the US’s war against Tehran. Brent crude, the global oil benchmark, was up 3.9% by early morning ET while WTI, the US benchmark, had risen 2.9% to trade at $89 a barrel — both reaching their highest levels since early June. Fears of a widening conflict in the Middle East have “fuelled speculation” that major central banks could hike interest rates to tame a potential uptick in inflation, Deutsche Bank analysts said in a note on Thursday. Houthi militants based in Yemen claimed to have struck two Saudi Arabian oil tankers in the Red Sea on Thursday, days after the group announced a naval blockade on Saudi ships. Riyadh has re-routed millions of barrels of its oil exports from the Strait of Hormuz to the Red Sea, exiting via the Bab al-Mandeb strait. Now, that lifeline for the global oil market looks more tenuous. Brent has jumped 33% in July as the 60-day ceasefire between the US and Iran has unravelled. Washington launched a 12th consecutive night of strikes against Tehran overnight Wednesday. “Oil markets have come under fresh pressure given the news about the Houthis… (raising) fresh supply fears given Saudi Arabia has redirected oil exports to the Red Sea port of Yanbu,” the Deutsche Bank analysts said. Two killed in strike at Iran border crossing, Iranian media reports Iranian media on Thursday reported US strikes across the country’s south and west, including at a border crossing with Iraq. The reports follow the US military saying it conducted strikes against Iranian military and maritime targets, air defenses and missile and drone storage facilities. Two people were killed and at least 11 others wounded due to what a Khuzestan provincial official described as a missile attack at the Shalamcheh crossing, the official Islamic Republic News Agency reported Thursday. Also in Khuzestan province, which borders Iraq and the Persian Gulf, locations on the outskirts of Andimeshk and Ahvaz, as well as an asphalt storage warehouse in Ramshir, were targeted by US strikes, IRNA and state broadcaster IRIB reported. A strike was also reported at a site on the outskirts of Eslamabad-e Gharb, in western Iran’s Kermanshah province, according to IRNA. IRNA also reported strikes in the port city of Bushehr, near Iran’s only operating commercial nuclear power reactor. In southern Iran’s coastal Hormozgan province, explosions were reported in Sirik and Jask, IRIB reported. Satellite image appears to show smoke rising from King Faisal base in Jordan on Wednesday Satellite imagery captured by the European Space Agency on Wednesday appears to show smoke rising from a building on the King Faisal Air Base in Jordan. In the image, a trail of black smoke can be seen billowing from a set of white building on the northwest portion of the base. The Iranian Revolutionary Guard Corps (IRGC) claimed on Wednesday that it had targeted King Faisal base along with Prince Hassan base in Jordan with missiles and drones. Rubio meets Russian counterpart Sergey Lavrov as Iran and Ukraine conflicts rage US Secretary of State Marco Rubio met with Russian Foreign Minister Sergey Lavrov on the sidelines of the ASEAN summit in Manila Thursday morning. Neither answered questions from reporters about whether Russia was supporting Iran by helping to target US troops, or whether Moscow plans to halt its full-scale invasion of Ukraine. A readout from the State Department later confirmed the two envoys discussed “the US-Russia relationship and the need to end the Russia-Ukraine war.” On Telegram, Russia’s foreign ministry spokesperson Maria Zakharova shared that Lavrov briefed Rubio on the situation along the front lines of the Ukraine war, and “emphasized the inadmissibility of further arming the Kyiv regime.” Despite this, Lavrov confirmed that Russia was prepared for “a political and diplomatic settlement of the conflict,” Zakharova said. Prior to the Thursday meeting, Rubio was asked by a reporter whether he planned to press Lavrov on Ukraine during their meeting. “Obviously the war in Ukraine has in many ways impeded the ability of Russia and the United States to find areas of agreement on other topics, that doesn’t mean we won’t seek to find other areas of potential cooperation,” he said. Asked what role the US is playing in reaching an end to the Russia-Ukraine war, given talks have dissipated, Rubio said: “Perhaps there are now new conditions in place that will allow that conversation to happen.” For context: On the campaign trail in 2023 and 2024, US President Donald Trump said on dozens of occasions that he would end the war in Ukraine either within 24 hours of his return to the White House or even sooner than that. More than 500 days into his second term in office, that war still rages with peace talks making little progress. Satellite image appears to show Saudi oil tanker on fire in the Red Sea Satellite imagery from NASA appears to show the Saudi-flagged tanker Encelia (IMO: 9240172) on fire in the Red Sea, following claims by Yemen’s Iran-backed Houthis that they struck two Saudi oil tankers early Thursday morning local time. The bright spot visible in the image matches the location the Encelia was broadcasting via its Automatic Identification System (AIS), according to a CNN analysis of shipping data. A satellite image from the previous day showed no such bright spot at that location, indicating the bright spot is new. The Encelia was “targeted while sailing in the Red Sea,” causing “a fire on the vessel’s bow,” Saudi State News Agency reported, citing an unnamed official at the General Transport Authority. “All crew members are safe,” the report said. The UK Maritime Trade Operations (UKMTO) reported that a tanker was struck by an “unknown projectile” 70 nautical miles southwest of the Saudi Arabian town of Al Shuqaiq, which “caused a fire onboard.” The UKMTO did not provide the name of the ship, however, the location they provided matches both the bright spot seen in the satellite imagery and the AIS position the Encelia was broadcasting. NASA’s VIIRS (Visible Infrared Imaging Radiometer Suite) sensor captures low-light and thermal emissions at night, making it sensitive enough to detect fires. Houthi military spokesperson Yahya Saree said they will “continue their naval operations” against Saudi Arabia and “persist in enforcing “a siege for a siege’ equation,” according to Reuters news agency. CNN’s Lex Harvey contributed reporting. "Eye for an eye." War of words between Tehran and Washington heats up As the US and Iran continue to trade daily strikes, Tehran and Washington have also been engaging in an escalating war of words, with leaders on each side threatening to match any attacks with a more aggressive response. “Any aggression against Iran, including our infrastructure, will compel a powerful and decisive response,” he added. What Trump said: Araghchi’s comments came after US President Donald Trump said Wednesday the US will “bomb and destroy one bridge or power plant” every time Iran targets a ship transiting the Strait of Hormuz, including those near or in the Iranian capital, Tehran. Trump has previously threatened to target Iranian civilian infrastructure — which could be considered a war crime — including in an interview with Fox News last week when he said the US would “knock out all (Iran’s) bridges unless they get to the table and negotiate.” How Iran responded: A senior Iranian official warned Iran will retaliate by striking infrastructure across the region. Tehran also reiterated that it will “exercise its sovereignty over the Strait of Hormuz,” the Iranian military official said. Houthis claim Red Sea attacks as US conducts more Iran strikes. Catch up here Yemen’s Iran-backed Houthis claimed to have struck two Saudi oil tankers in the Red Sea early on Thursday morning local time, an attack that threatens to create a new front in the war with Iran. Meanwhile, the US military said it launched a new wave of strikes against Iran, and Iran’s revolutionary guards said Thursday local time that an oil tanker caught fire following an explosion near the Strait of Hormuz. Here’s what else to know: - Red Sea attacks: Satellite imagery from NASA appears to show the Saudi-flagged tanker Encelia on fire in the Red Sea after the UK maritime authority reported a tanker was struck off Saudi Arabia’s Al Shuqaiq, which “caused a fire onboard.” It follows the Houthis’ announcement on Monday of a naval blockade on Saudi ships. - Iran claims oil tanker caught fire: Iran’s IRGC said a vessel caught fire after it attempted to pass what it described as the mined route south of the Strait of Hormuz, Reuters reported. The IRGC did not give timing for the incidents or further details, and CNN cannot independently verify the claims. - 12th night of strikes: The US military conducted more strikes on Iranian military and maritime targets Wednesday night, which were meant to “further degrade” Iran’s ability to threaten commercial vessels in regional waters, US Central Command said, as the two countries continue to trade threats to hit critical infrastructure. - Trump’s threats: President Donald Trump said Wednesday the US will “bomb and destroy a bridge or power plant” every time Iran targets a ship in the Strait of Hormuz. Iran, in turn, will hit infrastructure and energy facilities across the region, an official told Iranian media. - Pickaxe Mountain: Tehran has also accused Washington of using Pickaxe Mountain as a pretext for further attacks, after Trump earlier also threatened to attack the suspected underground nuclear site. - Fallen soldiers: Trump attended a dignified transfer of four US service members who were killed in the war. He described the solemn ritual as “one of the hardest things to do as a president.” CNN’s Aleena Fayaz, Alejandra Jaramillo, Elise Hammond, Lex Harvey, Tal Shalev, Sophie Tanno and August Phillips contributed reporting to this post. A new front is opening in the Iran war. Oil faces "no way out" The Houthis’ blockade of the Bab al-Mandeb strait couldn’t have come at a worse time for the oil market. Iran’s proxies in Yemen have threatened to cut off a major bypass of the Strait of Hormuz, through which oil tanker traffic has slowed dramatically in recent days. An effective Houthi blockade of Bab al-Mandeb would create a new front in the war with Iran, potentially requiring US military intervention that could then erode US ability to help ships out of the Strait of Hormuz. It also could prevent the Saudis from getting diesel to Europe at a crucial time for the fuel market. Why the strait is important: Bab al-Mandeb isn’t as crucial as the Strait of Hormuz, through which 20 million barrels of oil – 20% of the world’s daily supply – typically transited before the war. But Bab al-Mandeb is no slouch: About 6.2 million barrels of oil have been traveling through that strait every day over the past month, according to Kpler. Read more about the impacts of a Houthi blockade here. US Marine unit returns to Japan after deploying to Middle East during the early days of war A US Navy amphibious ready group with about 2,200 Marines aboard has returned to Japan after deploying to the Middle East in early days of the US war with Iran. The USS Tripoli Amphibious Ready Group (ARG) “offloaded” the 31st Marine Expeditionary Unit (MEU) to their base on the island of Okinawa on Wednesday, according to a US Navy statement. The 31st MEU Marines were also considered to be a possible force for any US ground attack on Iran or its islands in the Strait of Hormuz or Persian Gulf. Their departure from the Middle East leaves the USS Boxer ARG and its embarked 11th MEU, also with around 2,200 Marines, to help enforce the Washington’s reimposed blockade of Iran as well as be available for any possible ground contingencies. The USS Tripoli and USS Boxer are amphibious assault ships, essentially small aircraft carriers displacing around 40,000 tons. Besides the Marines, they carry watercraft to get them ashore and aircraft including helicopters and F-35B fighter jets. Dignified transfer of 4 US service members recently killed in Iran war took place Wednesday The dignified transfer of four US service members killed in fighting with Iran took place Wednesday at Dover Air Force Base in Delaware. They are among the 18 US troops killed in connection with the war in Iran. During the transfer, which marks the return of the service members’ remains to the United States, transfer cases are used to transport them before they are taken to their final resting places. After attending the dignified transfers, President Donald Trump reflected on how it is among the hardest parts of his job. Here’s what we know about the four service members: - Lt. Tyler Feehan, of Ewa Beach, Hawaii, died July 18 in Jordan, the Department of Defense said. He was assigned to 2nd Battalion, 55th Air Defense Artillery Regiment, 32nd Army Air Missile Defense Command in Fort Bragg, North Carolina. Known by loved ones as “Tivo,” Feehan was looking forward to marrying his partner after his deployment. He also planned to go to law school as another way to serve others. His family said he quoted the movie “Legally Blonde” often about studying law, saying: “What, like it’s hard?” - Pvt. Isabella Gonzales just graduated from high school last spring before enlisting in the Army, her Texas high school told CNN. The 19-year-old from Carrollton, Texas, died in the Muwaffaq Salti Air Base strikes in Jordan on July 17, the Department of Defense said. In her late teens, Gonzales exuded a level of self-confidence many spend their whole lives trying to find, her friend Jade Pena told CNN. “No matter where life took her, she never stopped being herself,” Pena said. “She remained kind, genuine, and full of light. I miss her so much.” - Sgt. Angel S. Rampersad, 28, was killed in action during the same Friday attack in Jordan, according to the Pentagon. The soldier was previously listed as missing by US Central Command. Rampersad was assigned to 1st Battalion, 57th Air Defense Artillery Regiment, 52d Air Defense Artillery Brigade, 10th Army Air and Missile Defense Command, Ansbach, Germany. She served as a 25U Signal Operations Support Specialist, the Defense Department said in its statement. - Sgt. Michael Emmanuel Swinton of Fayetteville, North Carolina, was killed on July 19. The Defense Department on Tuesday identified Swinton as another service member who was killed in action during a controlled detonation of a downed Iranian drone in Iraq. Swinton, 30, “answered the call to duty with courage, honor, and selfless dedication,” the Defense Department said.

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Here's the latest • Widening conflict: Yemen’s Iran-backed Houthis claimed to have struck two Saudi oil tankers in the Red Sea Thursday following their Monday announcement of a naval blockade on Saudi ships. Global oil prices rose to over $98 a barrel on the news. • Ongoing threa…

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Jul 23, 2026strikeUnverifiedUSIsraelIranProxy

Will the Houthis escalate attacks on the Bab el-Mandeb Strait? | The Jerusalem Post

○ 1 source

Houthi forces in Yemen have stated that they conducted missile and drone strikes on two oil tankers, ENCELIA and LAYLA, in the Red Sea, claiming the vessels violated a maritime blockade and that the attacks caused fires onboard. These statements follow Houthi announcements of restrictions on shipping through the Bab el-Mandeb Strait and reports of Saudi opposition to flights into Sana’a airport amid broader US-Iran tensions.

Independent verification of the strikes and blockade effects has not been confirmed.

Location: Bab-el-Mandeb

SETH J FRANTZMAN

Jul 23, 2026strikeUnverifiedUSIranProxyUNEURussiaChina

Futures Slide After Google Earnings, Oil & Bond Yields Jump On Houthi Escalation

○ 1 source

Futures Slide After Google Earnings, Oil & Bond Yields Jump On Houthi Escalation

US equity futures are lower as WTI breaches $90/bbl and Brent approaches $100/bbl (Houthi escalation in the Red Sea as two Saudi tankers were struck), pushing bond yields higher with longer-dated yields seen making new highs, globally. But, Alphabet's underwhelming results - while dragging down Mag7 names - are boosting Semis / AI (CapEx spend) which may mean the market is returning to its barbell of longs in AI / Semis plus Energy versus shorts in Rate-sensitives.

* * *

Overnight saw oil prices extend their recent resurgence with WTI crude topping $90/bbl. The Iran-aligned Houthis said they targeted two oil tankers in the Red Sea, potentially opening up another front in the war.

US forces struck Iranian military targets including maritime capabilities, missile and drone storage facilities, coastal surveillance sites, and air defense assets, Centcom said.

Commodities are led by the Energy complex; Base is higher, Precious is lower, and Ags mixed.

Pre-mkt, US yields are up 3-4bps across the curve with USD flat.

The surge in crude prices has dragged rate-hike odds higher (July very much back on the table)...

In Equities, Mag7 is weaker with all 7 names lower with GOOGL, TXN, TSLA, and IBM all lower following earnings.

Semis / Memory are bid. Defensives and Energy are higher with Cyclicals mostly lower ex-Industrials which are being boosted as part of the AI theme.

Utils are bid with AI outweighing higher yields.

European stocks fall as technology shares are dragged lower by STMicroelectronics, which slumped 17% after disappointing with its sales outlook.

Elsewhere, Nestle posted its biggest intraday drop since 2020.

Stoxx 600 falls 0.6% to 642.78 with 405 members down, 184 up, and 11 unchanged.

Asian shares rose as sentiment improved on expectations that regional tech hardware companies will benefit from Alphabet’s plans for more AI spending.

The MSCI Asia Pacific Index climbed as much as 1.4%, led by Samsung and SK Hynix.

A Bloomberg gauge of Asian chip shares advanced as much as 1.7%, extending its gains for a third session after tipping into a bear market last week.

Gains in artificial intelligence and semiconductor shares pushed the benchmarks in South Korea and Japan higher.

Thursday’s moves across Asian markets reflect investors’ willingness to prioritize AI enthusiasm, earnings and capital spending plans in the short-term over geopolitical tensions that linger, primarily from the Middle East.

Top Overnight News

The ECB is expected to maintain interest rates at 2.25% today, buying time to assess the fallout from renewed Middle East hostilities.

A rally in Indonesian stocks put the nation’s benchmark index on track for a bull market, helped by a rotation into market laggards as well as a recent credit-rating announcement.

The oil price has risen above $98 a barrel for the first time since early June after Iran-backed Houthi militants said they had attacked two Saudi Arabian tankers in the Red Sea.

The U.S. is surging forces, medics and weaponry to the Middle East to give President Trump more muscular military options as he considers expanding the conflict against Iran, according to people familiar with the matter.

The U.S. military used a B-1 long-range bomber on Tuesday to strike Islamic Revolutionary Guard Corps targets in Iran, U.S. officials said. It was the first time the U.S. conducted a B-1 mission since fighting with Iran resumed 12 days ago.

Russia is set to receive a shipment of fuel from India, as Moscow is forced to import petrol after Ukrainian drone attacks destroyed parts of its major refineries.

A rare surge in Latin American currencies is squeezing exporters by reducing the value of US dollar-denominated revenue. Coffee growers, banana producers and manufacturers face shrinking margins despite stronger investor confidence.

Allies of Donald Trump have discussed whether an external review of the Silicon Valley Bank collapse might justify removing Fed Governor Michael Barr over his role overseeing bank supervision at the time, people familiar said.

Private equity takeovers of software groups are at a turning point as investors hunt for bargains among companies at risk of being disrupted by AI.

A more detailed look at global markets courtesy of Newsquawk

EQUITIES

European bourses (STOXX 600 -0.6%) started Thursday's busy earnings day in the red, with higher energy prices and disappointing earnings weighing on indices. On the geopolitical front, the US and Iran exchanged strikes for the 12th consecutive night, while US President Trump said Iran is getting hit so hard and that they want to make a deal. Additionally, Yemeni Houthis targeted two Saudi oil tankers in the Red Sea, while reports noted that at least 9 ships have stopped passing through Bab al-Mandeb, following the blockade on Saudi ports by Houthis. Sectors highlight the negative bias. Energy (+1.6%) tops the sector pile, with Real Estate (+0.8%) also printing decent gains. Food, Beverages & Tobacco (-2.9%) is the sector laggard, following Nestle earnings in which RIG missed estimates. Consumer Products & Services (-2.0%) and Travel & Leisure (-1.5%) rounds out the key underperformers. A lot of big European earnings this morning, with focus concentrated on STMicroelectronics figures. Its Q2 metrics beat estimates; however, its guidance and commentary have driven the biggest drop in shares since October 2025 (-13.8%). The Co. guided Q3 net revenue of "about" USD 3.7bln, which missed analysts' expectations, and raised its revenue ambition for data centres due to continued strong demand. Citi analysts say that shares already reflect a recovery across its end markets and acceleration in revenue from data centres. Additionally, analysts say that shares may struggle in the near-term. US equity futures are softer across the board, with downside in tech-heavy NQ weighed on by STMicroelectronics earnings. Mag-7 earnings kicked off yesterday after the bell, with Alphabet and Tesla reporting Q2 metrics. For GOOGL (-3.9% pre-market), it sharply raised its AI capex forecast (which benefited Asia-Pac chip names overnight). For TSLA (-5.6% pre-market), Q2 figures disappointed, as adj. EPS missed estimates. Alphabet Inc. (GOOGL) Q2 2026 (USD): EPS 9.11 (exp. 2.88), Revenue 119.8bln (exp. 117.00bln), Operating income 40.77bln (exp. 40.55bln), Capex 44.92bln (exp. 44.15bln). Raises FY26 capex view to USD 195bln-205bln (prev. 180bln-190bln). Tesla Inc. (TSLA) Q2 2026 (USD): Adj. EPS 0.33 (exp. 0.52), Revenue 28.2bln (exp. 25.99bln), Gross margin 16.8% (exp. 19.4%), Automotive revenue 20.52bln (exp. 18.68bln). Click for the sessions European pre-market equity newsflow Click for the additional news FX

G10s are mixed after initial losses for the Greenback were reversed as energy prices continue to determine bias. Action which has benefitted energy exporters CAD and NOK, the sole currencies firmer against the Buck. USD erased earlier modest losses as energy lifted to session highs with the Brent Sept’26 contract approaching levels not seen since May. Geopolitics remains constructive for the Buck, and there are no signs of immediate de-escalation - focus on Houthi attacks on Saudi Arabian vessels alongside flows through Bab al-Mandeb. Elsewhere, US earnings after the NY close were received poorly, with Google and Tesla slipping between 3-5% premarket, hitting indices and potentially increasing appetite for the Buck’s haven status. DXY rose from beneath the 21DMA @101, to mark a high at recent resistance near 101.20/1. EUR is lacklustre against the Buck ahead of the ECB meeting, where just 4bps of tightening is implied by markets. The Governing Council is likely to convey a hawkish message after the recent energy pressures. Should the bank stand pat on rates as analysts/markets expect, focus will be on guidance which could spur a move above two fully priced 25bp hikes by year-end. EUR/USD is well off highs made early in the domestic session, though found support towards 1.14. ING says this morning its near-term bias is tilted to the downside, noting if Gulf newsflow lacks signs of de-escalation, it looks for the pair to slip towards 1.1380 in the coming days. AUD is resilient against the Buck after strong jobs numbers overnight. The data saw headline Employment Change smash estimates at 76.3k (exp. 15k), and the Unemployment Rate remained at 4.4% despite higher Participation. It appears NZD is used as a funder to express AUD hawkishness given USD swings on geopolitics, with AUD/NZD +0.4%, while AUD/USD is flat. TRY looks to the CBRT meeting, where analysts have shifted calls for easing in exchange for a hold amid the recent energy pressures. Turkish inflation eased to 32.1% Y/Y in June from 32.6% in May, as energy prices fell following the US-Iran MoU, which has since broken down. Despite the softer print, most analysts still forecast year-end inflation above the CBRT’s 26% target (incl. GS, MUFG at 30%), suggesting rates will remain higher for longer, particularly after the recent resurgence in Gulf tensions. Banks mostly expect the bank to stand pat on its key rate; HSBC said it could instead adjust its funding policy, lowering the average funding cost for commercial banks without formally changing the policy rate; JPMorgan expects the CBRT to resume one-week repo auctions, while Garanti BBVA, which recently shifted its call, expects a hold, but does not rule out easing. USD/TRY is lacklustre ahead of the decision. FIXED INCOME

A bearish start for fixed income as energy climbed overnight and into the European morning after the 12th consecutive evening of action by the US in the Middle East. Action that has taken Brent above USD 98/bbl and weighed on global yields. Overnight, JGBs reacted to the above and also a Reuters source report from Wednesday that the BoJ is alert to inflationary risks that could result in tightening taking place faster than the market is pricing. JGBs down to a 127.04 base, lower by just over 20 ticks. USTs hold at a 108-09 low, with downside of just a few ticks on the day. Today’s docket features weekly claims (initial claims coincide with the BLS survey window), before a 10yr TIPS auction and the latest Chicago Fed. Bunds under pressure as above, down to a 124.17 base at worst but currently holding around 15 ticks clear of that but still lower by over 20 ticks on the day. Action that has pushed the 10yr yield to a 3.2% peak, just above May’s best to a new YTD high, a dynamic that is also reflected at the short-end, where the 2yr has notched a new YTD peak of 2.88%. Energy has driven much of this, but the short-end is also likely being spurred further by the associated implications for the ECB. While a hold is the base case today, the accompanying guidance may well be more hawkish and explicit than the usual no-signal, data-dependent and meeting-by-meeting approach we have become accustomed to. Note, given the moves in recent days, more hawkish guidance may only spark a modest hawkish reaction, while a reiteration of the above non-committal language could see a relatively more pronounced dovish move. However, again, any such reaction would likely be limited in nature as geopolitics and, by extension, energy dictate the narrative. Gilts opened lower and underperformed, in the typical action seen when energy is bid. Opened with losses of 15 ticks and then slipped to an 86.07 base, just above the 86.03 low from April but some way clear of May’s 84.98 contract trough. No real reaction to commentary from UK Chancellor Healey this morning, who stuck with familiar language. The day ahead for UK rates may take direction from the ECB as outlined above, as any hawkish nod from Europe would be in contrast to the on hold for the foreseeable narrative which remains around the BoE, despite the dissenters and clearly contrasting views on Threadneedle Street. COMMODITIES

Middle Eastern geopolitics continues to dominate price action, with the US and Iran exchanging strikes for the 12th consecutive night, whilst US President Trump said Iran is getting hit so hard and that they want to make a deal. He added that Iran will be ready very soon but is not ready for a deal yet. Hostilities across the region have also expanded, as Yemeni Houthis targeted two Saudi oil tankers in the Red Sea, while reports noted that at least 9 ships have stopped passing through Bab al-Mandeb, following the blockade on Saudi ports by Houthis. On that note, Pakistan's Foreign Ministry, on the Yemeni Houthi threat, said, "If our ships are attacked, it will be treated as an attack on Pakistan, and we will retaliate”. As a reminder, Pakistan and Saudi Arabia signed a mutual defence pact in September 2025. The treaty states that an attack on one nation is considered an attack on both. If the Houthis launch severe ballistic missile strikes on Saudi territory or fully disrupt its vital energy exports, Riyadh could formally trigger this pact. This could further complicate the picture as Pakistan is the main mediator in US-Iran talks. Further on this front, Pakistani PM Sharif held a call with Saudi Crown Prince MBS; the two condemned the Houthi militia’s attacks against Saudi oil tankers in the Red Sea; and reaffirmed Pakistan's "complete solidarity" with Saudi Arabia. Elsewhere, reports noted the sound of an explosion was heard in Qatar and Jordan, whilst an explosion was also heard in Iran around Qeshm city near Konarak. Elsewhere in geopolitics, US Secretary of State Rubio said he had a good and frank conversation with the Russian Foreign Minister; the US is prepared to take a constructive role to end the war in Ukraine. Meanwhile, EU Ambassadors have reached a political agreement on the 21st sanctions package against Russia, according to diplomats; additionally, the bloc is to freeze the oil price cap for a 12-month period. WTI and Brent futures at session highs. WTI Sep’26 trades beyond the USD 90/bbl mark, currently at the top end of its USD 87.32-90.35/bbl range. Brent Sep’26 resides near USD 98.50/bbl in a USD 94.89-98.75/bbl range. Dutch TTF prices have waned after hitting resistance near EUR 64/MWh before dipping sub-62.50/MWh. This morning, sources reported that buyers of LNG from Qatar and the UAE are seeking lower prices and stronger supply guarantees as risks to shipments through the Strait of Hormuz increase. Precious metals are softer as rising oil prices once again hit by the rising oil prices. Spot gold trades in a USD 4,087-4,141/oz range, within yesterday’s USD 4,076-4,166/oz range. Spot silver briefly dipped under yesterday’s 58.73/oz low to currently trade towards the bottom end of a USD 58.66-60.07/oz range. Base metals are mostly lower amid the inflationary impact of higher oil prices. 3M LME copper trades towards the lower end of a USD 13,709.00-13,873.70/t range. Buyers of LNG from Qatar and the UAE are seeking lower prices and stronger supply guarantees as risks to shipments through the Strait of Hormuz increase, according to sources. Kazakhstan's daily oil production fell after loading operations were suspended at the CPC export terminal on the Black Sea, sources say, output down 21% on Wednesday vs July average TRADE/TARIFFS

China's MOFCOM said China and the US are working towards the tariff cut plan; to maintain close communication. UAE Foreign Trade Minister said imports of high-end US AI chips expected soon, Bloomberg reported. NOTABLE EUROPEAN HEADLINES

The UK PM announced that pubs, clubs and live music venues are set to receive a 20% cut to their business rates bills, saving the typical pub an estimated GBP 1,100/yr. UK Chancellor Healey said he is as concerned about the cost of business as the cost of living. NOTABLE US HEADLINES

US President Trump said the government will face a shutdown in September. Some Trump admin officials and allies have privately discussed whether an external review of the 2023 failure of Silicon Valley Bank could provide a legal basis to remove Fed Governor Barr, according to Bloomberg. US is investigating Chinese AI firm Moonshot over chip access, with the BIS probing if the Co. used US chips for model training, according to The Information. Trump admin is reportedly divided about restricting Chinese AI models, with the White House mulling preventing Chinese labs from distilling US models, and Commerce Department favours incentivising US companies to develop open models to counter China GEOPOLITICS

MIDDLE EAST

US Secretary of State Rubio said Iran was intending to double missile stockpile and that it looks like Iran is not ready to make a deal. He added that the price on Iran will get higher every night until they come to their senses but that Iran is begging to reach a deal. US CENTCOM said the US completed the 12th consecutive night of strikes against Iran, in which the US struck Iranian military targets including maritime capabilities, missile and drone storage facilities, surveillance sites and defence assets. US military has started using B-1 long-range bombers in its strikes against Iran, according to i24's Stein citing a source that stated the first strike using the bomber was conducted on Tuesday. A senior US official said negotiations continue but the decisive moment for expanding hostilities is rapidly approaching, N12 reported. There were several explosions heard in Kuwait, Qatar and Jordan while sirens were sounded in Bahrain. In Iran, explosions were heard in Bushehr, Bandar Mahshahr, Sirik, Konarak City and Ramshir. Additionally, Iranian media reported that a power station was hit by a missile near the Bushehr nuclear power plant in the south of the country, according to Sky News Arabia. IRGC said one of three offending ships attempting to pass the Strait of Hormuz caught fire and the other two quickly turned back, while it also targeted US bases in Jordan, and declared the Strait of Hormuz closed. Additionally, the IRGC said it targeted US military in Kuwait's Al-Adiri camp and Ali Al-Salem Airbase. Yemen's Houthis announced they targeted two Saudi oil tankers in the Red Sea. In other reports, at least 9 ships have stopped passing through Bab al-Mandeb, following the blockade on Saudi ports by Houthis. Two Chinese supertankers carrying Saudi crude are heading to Bab al-Mandeb, according to reports citing data. Pakistani PM Sharif held a call with Saudi Crown Prince MBS. The two condemned the Houthi militia’s attacks against Saudi oil tankers in the Red Sea and reaffirmed Pakistan's "complete solidarity" with Saudi Arabia. Pakistan's Foreign Minister, on US-Iran talks, said they can not confirm 10-15 days or anything because these are confidential communications but they have not lost hope even during the darkest days of this escalation cycle. Pakistan's Foreign Ministry, on the Yemeni Houthi threat, said that if Pakistani ships are attacked, it will be treated as an attack on Pakistan and will retaliate. UKMTO said it received a report of an incident 70NM of Al-Shuqaiq, Saudi Arabia, with a tanker reported to have been struck by an unknown projectile, causing a fire on board. Oman’s Foreign Ministry said it is working with Saudi Arabia and Yemeni parties and the UN special envoy to resume the political process aimed at achieving regional security and stability. The US is on course to get no new military spending before the election and they are warning it could be a huge problem for them amidst the war with Iran, according to Semafor. RUSSIA-UKRAINE

US Secretary of State Rubio said he had a good and frank conversation with the Russian Foreign Minister and the US is prepared to take a constructive role to end the war in Ukraine. Russia's Foreign Minister Lavrov confirmed that Russia is prepared to resolve the conflict in Ukraine through political and diplomatic means, according to the Russian Foreign Ministry. EU Ambassadors have reached a political agreement on the 21st sanctions package against Russian, according to diplomats. Additionally, to freeze the oil price cap for a 12 month period. OTHER

China is conducting live fire, military drills in some areas of the Taiwan Strait on Thursday and Friday. CRYPTO

Bitcoin continues to pare back Tuesday's gains but remains firmly above the USD 65k mark. APAC TRADE

APAC stocks were predominantly in the green as semiconductor strength helped the region shrug off the lacklustre lead from Wall Street and the widening geopolitical escalation in the Middle East. ASX 200 was lifted amid outperformance in the commodity-related and materials sectors, while sentiment was also helped by strong jobs data. Nikkei 225 rallied at the open but is well off today's best levels amid higher oil prices and after hitting resistance around the 67,000 level. KOSPI remained driven by semiconductor advances with both Samsung Electronics and SK Hynix in the green, while chaebols dominated the list of biggest gainers and participants also digested stronger-than-expected South Korean GDP data. Hang Seng and Shanghai Comp were mixed, with Hong Kong led higher by strength in mining names, while the mainland was lacklustre as trade-related frictions lingered, with the US investigating Chinese AI firm Moonshot over chip access and whether the Co. used US chips for model training. Deutsche Bank's Jim Reid concludes the overnight wrap

Inflation has remained top of the agenda for markets this morning, with Brent crude moving up to almost $96/bbl overnight as the Middle East escalation continues. Indeed, the strikes between the US and Iran show no sign of easing, and the Houthis said they targeted two oil tankers in the Red Sea yesterday, raising fears that the conflict is widening. So that’s pushed oil prices up to a 7-week high, and has also fuelled speculation about more rate hikes. For instance, futures are currently pricing in a 36% probability of a Fed rate hike as soon as next week, and bond yields jumped as well, with the US 30yr real yield (+0.4bps) closing at a post-2008 high of 2.93% yesterday. So it was a tough backdrop, and equities struggled to gain traction too, with the S&P 500 down -0.14% yesterday, whilst futures are down another -0.13% this morning following earnings from Alphabet and Tesla.

We’ll start with the geopolitics, as the US-Iran conflict has shown no sign of easing, and there’s still no indication of any emerging peace deal either. In fact, President Trump posted yesterday that if Iran shoots at a ship in the Strait of Hormuz, then the US would “bomb and destroy ONE BRIDGE OR POWER PLANT”. And shortly after, Trump said in person that Iran would pay a big price after US troops were killed, whilst Iran’s foreign minister Abbas Araghchi posted that aggression against Iran “will compel a powerful and decisive response”, and that those “who contribute to such aggression, whatever the kind of support, will also be considered as legitimate targets”. Overnight, US Central Command confirmed that they’d completed another round of strikes against Iran, whilst oil markets have come under fresh pressure given the news about the Houthis targeting two oil tankers in the Red Sea. So that’s raised fresh supply fears given Saudi Arabia has redirected oil exports to the Red Sea port of Yanbu.

That backdrop drove a fresh jump in commodity prices, with oil prices continuing to move higher. So Brent crude jumped +3.36% to $94.07/bbl by yesterday’s close, and is up a further +1.96% this morning to $95.94/bbl. Moreover, investors also priced in a longer period of high oil prices, and the 6-month Brent future (+0.59%) hit a one-month high of $81.74/bbl yesterday as well. And elsewhere, the energy shock was extending beyond oil prices, with European natural gas futures (+4.82%) exceeding their recent high back in March yesterday, closing at levels last seen in early 2023, at €62.54/MWh.

The latest rise in energy prices led to fresh concerns about a more prolonged stagflationary shock, with investors pricing in more inflation as a result. In fact, the 1yr Euro inflation swap (+4.7bps) was up for an 8th consecutive day to 2.64%, whilst the 1yr US inflation swap (+1.2bps) also rose to 2.05%. Unsurprisingly, that also saw investors price in a more hawkish path for central banks. So Fed futures are now pricing in a 36% chance of a rate hike next week, having now unwound most of the moves after the downside CPI surprise last week. And over in Europe, investors are now pricing in 48bps of further hikes by year-end, on top of the 25bps we had last month. Indeed, that’s the most hawkish path priced for the ECB in the last couple of months.

With markets expecting more inflation and more rate hikes, that meant sovereign bonds took a fresh hit on both sides of the Atlantic as well. So US Treasury yields moved higher, with the 2yr yield (+3.5bps) up to 4.30%, its highest since February 2025, whilst the 10yr yield (+2.7bps) hit its highest since May, at 4.66%. In addition, there were some fresh milestones for real yields, with the 2yr real yield (+3.0bps) up to its highest since September 2024, at 2.34%, whilst the 10yr real yield (+1.6bps) hit its highest since October 2023, at 2.36%. Over in Europe there were more marginal increases, but yields on 10yr bunds (+0.7bps), OATs (+0.6bps) and BTPs (+0.8bps) all moved higher as well.

As all that was happening, equities have put in a much more mixed performance over the last 24 hours. In the US the tone has been more negative, with the S&P 500 down -0.14%. But in other regions things have been much more positive, and overnight we’ve seen the KOSPI (+3.98%), the Hang Seng (+1.34%) and the Nikkei (+0.52%) all advance. The main exception has been in mainland China, where the CSI 300 (-0.20%) and the Shanghai Comp (-0.19%) are both lower. But the European indices put in a solid performance as well yesterday, with the STOXX 600 up +0.58%.

US equity futures have continued to lose ground overnight following Alphabet and Tesla’s earnings after the US close. Alphabet delivered a solid earnings and revenue beat, reporting 82% yoy growth in cloud revenue in Q2 ($24.8bn vs $22.5bn est.). But its shares fell by over -3% in after-hours trading as the company increased its 2026 capex plan to a range of $195-205bn (vs. $186bn est.). And Tesla fell by over -4% after-hours after the company reported its first negative quarter of free cash flows in over two years, as solid auto sales were outweighed by a 47% yoy surge in operating costs. So futures on the S&P 500 are down another -0.13% this morning.

In general however, the equity picture has been pretty resilient over the last 24 hours, despite the latest uptick in oil prices, with fresh gains in Asia overnight. That might seem striking, but we’ve written before (link here) how oil prices beneath $100/bbl haven’t been enough to cause a meaningful dent in risk assets. Indeed, if you look earlier in the year, it wasn’t until they got to around $110/bbl that you saw meaningful vulnerabilities for equities and credit. Likewise, back in the 2022 energy shock, it was a similar real-terms threshold for Brent (above $110/bbl in today’s prices) that started to cause meaningful stress, which we’re still some way from right now. So for now at least, the current pattern is still consistent with what we saw earlier in the year.

Elsewhere in Asia, the yen did briefly strengthen yesterday after a Bloomberg report said that BoJ officials were open to faster rate hikes than the consensus expected. According to the report, it said officials were aware of expectations for hikes roughly every six months, but they were open to earlier moves instead. Moreover, the article said there were signs of inflation becoming more entrenched, whilst the yen’s decline meant there were further inflationary pressures. Those gains were then pared back, and this morning the yen is still trading at 163.06 per US dollar. However, front-end yields have continued to climb, with Japan’s 2yr yield (+2.5bps) at a post-1995 high of 1.48% this morning.

Otherwise overnight, the Australian dollar has strengthened +0.28% against the US dollar after the latest employment data for June led to mounting expectations of another RBA rate hike this year. The data showed employment up by +76.3k in June (vs. +15.0k expected), which was the biggest monthly jump in 14 months.

Looking forward, today’s main highlight will be the ECB’s policy decision at 13:15 London time. It’s widely expected they’ll keep rates on hold, after hiking at the last meeting in June. But given the latest surge in oil and gas prices, the focus will be on what they signal ahead, with markets pricing almost two further hikes by year-end. Our European economists think the ECB will maintain neutral communications in the press conference. So no explicit forward guidance, with an emphasis on a data-dependent, meeting-by-meeting approach that avoids pre-committing to a specific path. However, they do think the ECB will convey a hawkish stance on inflation, consistent with another 25bp hike in September being highly probable. For more info, see their full ECB preview here.

Otherwise in Europe, UK gilts saw a very marginal outperformance after the June CPI data surprised on the downside. It showed headline inflation falling more than expected to +2.6% in June (vs. +2.7% expected). However, some of the details weren’t quite as dovish in their implications, with core CPI actually remaining at +2.6% (vs. +2.5% expected). So 10yr gilt yields were still up up +0.5bps on the day, only slightly beneath the +0.7bps increase for 10yr bunds.

Looking at the day ahead, the main highlight will be the ECB’s monetary policy decision and President Lagarde’s subsequent press conference. Otherwise, data releases include the US weekly initial jobless claims, and the European Commission’s advance consumer confidence indicator for the Euro Area in July. Finally, today’s earnings releases include Intel.

Tyler Durden Thu, 07/23/2026 - 08:05

Tyler Durden

Jul 23, 2026strikeUnverifiedUSIsraelIranProxyRussiaChina

Oil prices surge towards $US100 mark after Red Sea attacks

○ 1 source

At least one Saudi oil tanker has been attacked in the Red Sea, widening the risks to energy supplies already disrupted by a near-halt to shipping in the Strait of Hormuz. The price of Brent Crude, the international benchmark, rose 5 percent to over $US98 a barrel as the violence raised fears of greater supply disruptions.

The Houthis, an Iran-aligned militant group in Yemen, said it attacked two vessels to enforce the maritime blockade it announced on Monday against Saudi Arabia. Secretary of State Marco Rubio told reporters in the Philippines on Thursday that the Houthis were making a mistake by menacing shipping in the Red Sea and joining the fighting in the Middle East on behalf of Iran.

“I hope that they’ll stop,” Mr Rubio said. “They got suckered into this by the Iranians.” The Houthis had largely stayed out of the US-Israel war on Iran during the opening months of the conflict, and Mr Rubio said they had been “smart” to do so. Mr Rubio said that one of the ships struck had actually been “flagged Chinese,” which risked angering another major world power.

Mr Rubio said he hoped the Houthis will de-escalate the situation, which threatens to further spike energy prices amid an already severe energy crunch due to the closure of the Strait of Hormuz. The apparent attacks off the coast of Saudi Arabia come as the US and Iran battle for control over the Strait of Hormuz.

They imperil a second critical shipping route through the Bab el-Mandeb Strait, a narrow channel connecting the Red Sea with the Gulf of Aden, which carries around 7 per cent of global oil supply. The scope of the Houthi blockade remains unclear. Even before Wednesday’s attacks, several vessels had already reversed course following the announcement of the Houthi blockade, according to ship-tracking data and analysis.

A statement issued by the Houthis identified the tankers as the Encelia and the Layla, which are listed as Saudi vessels by Kpler, a maritime monitoring agency. The Saudi news agency and a British monitoring group reported Thursday that one vessel had been struck, but did not confirm who carried out the attack.

A second attack has not been corroborated by maritime monitoring agencies. The targeting of the Encelia resulted in a fire at the bow of the ship, but all crew members remained safe, Saudi Arabia’s press agency reported, citing the country’s Transport General Authority.

The UK Maritime Trade Operations - a monitoring agency that is part of Britain’s royal navy - reported an attack on a tanker off the coast of Al Shuqaiq, Saudi Arabia, with a ship struck by an “unknown projectile” causing a fire on board. It did not disclose the identity of the vessel.

The Encelia departed the Saudi Arabia’s Yanbu port on Monday and sailed south through the Red Sea, according to ship tracking data. After a short stop near Jeddah on Tuesday, the vessel continued southward toward the Bab el-Mandeb Strait. At around 10pm local time on Wednesday, around 800km into its voyage, the vessel appeared to make a sudden alteration of its course near Saudi Arabia’s Farasan islands.

Your cookie settings are preventing this third party content from displaying. If you’d like to view this content, please adjust your . To find out more about how we use cookies, please see our Cookie Guide. Just over an hour later, ship tracking data shows the vessel’s navigational status changed to “not under command,” signaling an emergency or breakdown.

The vessel then appeared to come to a halt around 100 miles from Yemen’s shores. Maritime intelligence agency Lloyd’s List said in a research note Thursday the attacks on Layla are yet to be corroborated, but a “double blockade” on the Strait of Hormuz and the Red Sea could see Asian oil importers suffer as they are highly dependent on Middle East crude oil and derivative products.

The Strait of Hormuz saw around 20 per cent of oil and gas supplies flow through before the US and Israel launched joint strikes against Iran in February. It has been largely shut by Iranian attacks on commercial ships and mines in the five-month war.

Overnight, the two sides continued to exchange strikes for the 12th day following the collapse of a preliminary peace agreement signed in June. The economic insecurity brought on by the Iran war has dominated this year’s annual gathering of Southeast Asian nations known as ASEAN.

At the start of the gathering, foreign ministers representing the bloc issued a statement saying they were “deeply concerned” about the impact of blockades of key maritime trade routes in the Middle East. Southeast Asian nations have been especially vulnerable to energy shortages caused by the Iran war.

The strategic region is important to major powers including China, Russia and the United States, which all sent their top diplomats to the meeting. Mr Rubio expressed sympathy for the impact the war was having on Iran but accused Tehran of breaking the US-Iran memorandum of understanding designed to open the strait.

He said the US nevertheless remain open to a diplomatic solution. Get the latest news from thewest.com.au in your inbox.

Victoria Craw; John Hudson; Imogen Piper The Washington Post Comments Comments

Jul 23, 2026strikeUnverifiedUSIranProxy

Oil prices surge toward triple digits after Red Sea attacks

○ 1 source

Oil prices rose on Thursday, with Brent crude increasing more than 5% to nearly $99 per barrel—its highest since June 3—and U.S. crude rising more than 4% to almost $91 per barrel, its highest since June 11. The increases followed claims by Houthi rebels of attacks on two Saudi oil tankers in the Red Sea and an announced naval blockade.

Global benchmarks have climbed about 35% since the start of the month amid concerns over shipping routes including the Bab el-Mandeb Strait.

Location: Red Sea

Steve Kopack