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Iran War 3.0: Where Did This All Go Wrong?
Iran War 3.0: Where Did This All Go Wrong? Authored by Alastair Crooke When the US Navy, in co-ordination with Qatar and Oman, tried to slip a convoy of four vessels through the Strait of Hormuz, via Omani waters, last Tuesday night – rather than pass via Iran’s officially approved route – Trump may have imagined (or been told) that with the massive funeral for the late Supreme Leader Ali Khamenei under way, that Iran would not react as the US Navy attempted to force open an American corridor. Trump however, misread the Iranian jibe – Hormuz is its “atomic weapon.” Iran will not relinquish it. Trump insists – in clear contradiction to the terms set out in paragraph five of the MoU – that Iran has no right to interfere with any ship trying to transit the Strait of Hormuz. Iran nonetheless is acting within the terms of the agreed de-escalation framework, and has warned repeatedly that it would strike any vessel circumventing the Iranian control mechanism. Iran responded directly to Trump’s challenge to Iranian control of the Strait by striking two vessels with missiles and a third with an armed drone. A forth Qatari-owned tanker, laden with liquefied natural gas, was set ablaze, forcing its crew to abandon the stricken vessel. These Iranian ripostes provoked Trump to order American air strikes against Iranian targets; to reimpose sanctions on the Islamic Republic’s oil exports; and to revoke the MoU framework he had signed with what he called the “Iranian scum” – thus ending the ceasefire. “We hit them hard last night,” Trump said at the NATO summit in Ankara. “We will probably hit them hard again tonight.” Trump did hit Iran again Wednesday night – even though Iran had not attacked another vessel seeking to by-pass the Iranian corridor. In response, Iran launched ballistic missiles and drones at US bases in Kuwait, Bahrain, the UAE and Muwaffaq Al-Salti airbase in Jordan. Vice-President Vance is saying to Iran, “If you try to close the Strait of Hormuz, the American military will respond. It’s that simple” – i.e. Iran either keeps the Strait fully open to all, or the US will keep hitting it, as it did on Tuesday night. Iran insists that it is the US that has violated the MoU and (via the spokesman for Iran’s Parliamentary National Security Committee) warns that further attacks by the US on Iran will be met by a comprehensive all-out surprise offensive by Iran – and potentially by other options too, such as an Iranian withdrawal from the NPT, changing the country’s nuclear doctrine, and closing the Bab al-Mandab Strait alongside the Strait of Hormuz. So, Vice-President Vance is saying if Iran restricts Hormuz (i.e. it stays open to friendly states’ vessels) the US will escalate. And Iran is responding to this threat by warning that it will escalate militarily – two strikes for every one American strike – and that they may also turn to new doctrines of warfare. Essentially, Trump has plunged into an escalatory trap, seemingly in part out of pique at his collapsing polls at home. He did, however, directly put himself in this situation by trying to “act cute” during the Khamenei funeral pre-occupations in order to try to gain a “quick win.” How long will this escalatory episode last? Certainly, it will not lead to the opening of the Strait; nor bring a return of the status quo ante that preceded the war. As long as Iran maintains its ability to exert control over Hormuz, there is no basis to assume that the situation will return to what it was. On the contrary, and more likely, the crisis will accelerate the onset of looming global economic crisis that could last until the economic pain becomes acute, as the drawdown on sour crude continues – and as the effects on the real economy in the West become visible. With shortages of munitions and the drawdown on air assets from the Middle East already beginning, Trump probably lacks the wherewithal to go full “Iran War 3.0.” The timeline to this new bout of low-intensity tit-for-tat therefore, is likely dictated by refinery inventories in the US; but also by the extent of the “hurt” being experienced by Trump back home in the context of his fading political prospects, but also by his dislike for any personal humiliation. Where did this all go wrong? Possibly the crux of it derives from the moment that Iran’s new Supreme Leader, Sayyed Mojtaba, issued his statement that he had held a different view on the MoU to that of the negotiating team, but had agreed to proceed with it after receiving an assurance from the Iranian President that he would ensure and take into account Iran’s overarching principles in respect to relations with the US. The Supreme Leader Mujtaba Khamenei’s statement put on notice both the US – and the Iranian negotiators – that Iran’s approval of the MoU was no open mandate, but rather closely tied to the 10 principles originally enunciated by the new Supreme Leader. At some point, the Iranian leadership seemingly came to the conclusion that Iran was being played by the US; that the MoU was a deception – …and that the entirety of events since the announcement of the MoU reflected a US strategy based on the view that in the previous round of the war against Iran – [that the US and Israel] failed to achieve their objectives – necessitating a halt to the confrontation, albeit temporarily, in order to regroup and prepare “more thoroughly” for a new round when the right conditions arise. This led to the Iranian reassessment that the Hormuz and Lebanon components constituted the vital leverage to engage in a new war as the West ramps up pressure as a holding strategy – whilst the US and Israel prepare for the next round of war. The interim US strategy is no change to US-Israeli objectives, but rather an adjustment to their operational mechanisms to provide for certain compromises that Washington considers necessary (i.e. closer working with Turkey and via Erdogan to engage Syria’s Jolani) to reshuffle the Lebanon deck, and then to “assess how the cards lie,” as Vance outlined. It is not certain that this new US policy will work. The world is changing rapidly. Their expected triumph of Israel over the Middle East has resulted in failure. Trump’s MoU ploy to open Hormuz likely will fail, too. The connected war on Russia and the siege of China are faltering too – and Israel’s (until now unassailable) hold over the US is in question too. A senior US democrat, Rahm Emanuel, and potential 2028 US Democratic presidential candidate, spoke in Israel yesterday; he warned in no uncertain terms that Israel “has lost the world’s support, become a ‘regional pariah,’ [and that its] alliance with the US is ‘at a crossroads’.” And finally, a “black swan” now can be observed swimming in increasingly sunlit waters – Eric Katz writing in Notus writes that, “a draft report inside the US Treasury Department is set to warn of the risks posed by the artificial intelligence market, likening key aspects of it to the dotcom bubble that upended the US economy when it burst in the early 2000s.” Treasury analysts wrote – Career Treasury analysts found that AI firms are more deeply entrenched in the US economy than their dotcom predecessors and pose significant risk to the entire system if financial conditions change, productivity goals are missed or various choke points stymie growth. A downturn in the AI market would send shockwaves throughout the entire economic ecosystem. A market downturn in the US – exacerbated by an energy crisis – could spell disaster for Trump’s midterm hopes. Tyler Durden Tue, 07/14/2026 - 23:25
No end in sight for new Iran war
No end in sight for new Iran war There was little hope in the region for a swift resolution to the fighting as the two sides remain unable to resolve control of the Strait of Hormuz. As the U.S. war with Iran resumes, there is little sign that diplomacy can stop it. Efforts by Arab, Pakistani and other mediators to revive negotiations or restore a ceasefire have shown no public signs of progress, and the overall feeling in the Middle East and beyond is that the fighting will simply continue for now, according to two analysts and a person familiar with the situation. The White House is “not really sure where this is headed,” said a former U.S. official in touch with Trump administration staffers, who, like others quoted in this story, was granted anonymity to describe sensitive conversations. “This could go on for some time. There’s no trust between Iran and the U.S., and that’s kind of the basis for any kind of diplomacy.” The renewed fighting includes a U.S. naval blockade of Iranian shipping and Tehran launching multiple attacks on U.S. allies. President Donald Trump has made clear Tehran must relinquish control of the vital energy shipping lanes in the Strait of Hormuz. But Iran has weathered previous assaults and still managed to threaten oil shipping with drones and missiles, and it’s not clear how this latest campaign would eliminate that threat. “I think the president will try to destroy Iran’s capabilities threatening the strait,” said Fred Fleitz, Trump’s former National Security Council chief of staff and vice chair of the American First Policy Institute’s American Security. “I think that we will have to take a so-called mowing the grass strategy, where the U.S. and Israel will respond militarily to provocations, then maybe we simply have to wait until the Iranian people take their country back.” Trump did offer a concession of sorts on Tuesday when he reversed himself and said the U.S. would not impose a 20 percent fee on countries shipping goods through the strait. Instead, he said the Navy would assist ships through the waterway in exchange for investment deals with the United States. The latest about-face is a hallmark of the president’s decision-making process and the minute-by-minute governing policy he favors. But White House allies see the American response as necessary. Trump “has to respond when the Iranians break faith, and I think that’s what he’s doing,” said Alex Gray, National Security Council chief of staff during Trump’s first term. “We can’t get back to an equilibrium unless the Americans demonstrate our willingness to escalate as needed. … I think it’s more of a tactical response to their bad behavior.” Just before the blockade was to go into effect on Tuesday, Iran launched a fresh wave of missile and drone attacks against Bahrain, Jordan and Kuwait — all nations that host U.S. military bases. The Iranian strikes come less than a day after a punishing five-hour American air assault on Iranian targets. The Kuwaiti military alone said it shot down 33 drones, a cruise missile and a ballistic missile. And the American military retains a powerful presence in the Middle East — another indication of continued hostilities. The U.S. maintains two aircraft carriers in the region, part of about 20 warships and a contingent of 2,500 Marines at sea. Most of the ships are capable of firing long-range missiles, and warplanes and long-range rocket artillery remain stationed in friendly countries along the Persian Gulf. Overall, there are about 50,000 American troops deployed in the Middle East since the war began in late February with U.S. and Israeli airstrikes against Iranian government and military targets. “The arsenal remains in place,” said one U.S. official. “We’re there, and we’re swapping out pieces, but we’re not going anywhere.” The U.S. Central Command said in a statement that on Tuesday night local time, U.S. forces “began launching an additional round of strikes against Iran to continue degrading Iranian capabilities used to attack commercial shipping in the Strait of Hormuz.” The strikes took place “as American forces prepare to resume the naval blockade against Iranian ports and coastal areas.” Windward intelligence, a private firm that tracks shipping though the strait, said on Tuesday it was tracking 23 vessels operating in the Persian Gulf “as potential blockade-breakers, 10 of them laden with approximately $432.3 million in cargo.” The monthslong bottleneck continues to wait for a final, workable agreement to resume shipping through the strait. And while the U.S. and Iran agreed to a memorandum of understanding designed to halt the fighting just a month ago, both sides have since accused the other of violating its terms on multiple fronts. Iran, for instance, interpreted the agreement as granting it control over the strait, through which flows a critical amount of oil, fertilizer and other global needs. The U.S., however, has tried to help ships get through the passage in ways Iran saw as a violation. The U.S. argued that Iran’s firing on commercial vessels trying to traverse the strait undermined the truce. While in Ankara, Turkey, attending a NATO summit this month, Trump declared an end to the ceasefire. “To me, I think it’s over,” he said upon arriving at the gathering just hours after U.S. forces struck Iranian military sites in retaliation for Iranian attacks on commercial shipping.
Netanyahu warns Iran of powerful retaliation if it attacks Israel
TEL AVIV, July 14. /TASS/. Israel is prepared for any developments in light of the current spiral of escalation around Iran, Prime Minister Benjamin Netanyahu said and warned Iran of a powerful retaliation should it attack his country. "We are prepared for any scenario. I can tell you only one thing, and I will say this to the leaders of Iran: Do not count on it being quiet if you attack us. Do not count on a rerun. Because it will not be a rerun, and that was already powerful enough. This (a potential strike - TASS) will be a different event, much more powerful," his office quoted him as saying at the Negev Conference in the city of Dimona in southern Israel, where the Shimon Peres Negev Nuclear Research Center is located. "The days when someone hurts us and we do not strike them back twofold are over. We did this to the Axis of Evil in Iran, and we will continue to do so to anyone who harms us. That is what we do," he stressed. The United States and Israel launched a war against Iran on February 28. In June, Washington and Tehran signed a memorandum of understanding envisaging an immediate cessation of hostilities on all the fronts, including in Lebanon. On July 8, US President Donald Trump said that the ceasefire with Iran was no longer effective and accused Tehran of violating bilateral agreements. On July 13, Iranian Foreign Ministry spokesman Esmail Baghaei said that Tehran had never violated the memorandum with the United States and blamed Washington for breaching it.
China Warns of Global Fallout as US Renews Iran Naval Blockade
China has criticized the United States for reinstating its naval blockade of Iran, warning that renewed tensions in the Persian Gulf are disrupting shipping through the Strait of Hormuz and undermining efforts to restore stability in the region. Foreign Ministry spokesman Lin Jian called on both sides to act with restraint and avoid further escalation. He said renewed missile attacks and the return of the blockade would only make it more difficult to reach a peaceful agreement between Washington and Tehran. "China is deeply concerned about the renewed military conflict in the Persian Gulf region," Lin said, stressing that diplomacy remains the only viable path to lasting stability. Lin noted that the recent ceasefire had been achieved only after considerable diplomatic effort. He argued that another round of confrontation would weaken momentum for peace negotiations and increase risks for international trade and regional security. He also urged all parties to respond to growing international and regional calls for peace, emphasizing the need for dialogue instead of military action. US President Donald Trump announced the renewal of the naval blockade against Iran on Monday, July 13, citing Tehran's missile attacks on foreign oil tankers transiting the Strait of Hormuz. He also introduced a 20 percent transit tariff for vessels passing through the strategic waterway. According to Trump, the measure reflects the rising costs the United States has incurred to maintain security along one of the Middle East's most important maritime trade routes. The announcement has heightened concerns about the future of regional stability and the uninterrupted flow of global energy supplies. Subscribe to Pravda.Ru Telegram channel, Facebook, RSS! The sudden death of US Senator Lindsey Graham has prompted an outpouring of political reactions and a wave of speculation following his final visit to Ukraine.
The Latest: Supreme Court justices set to testify in rare appearance before Congress
Weeks after the end of a historic term, Supreme Court Justices Elena Kagan and Amy Coney Barrett will make a rare appearance before Congress on Tuesday at 10 a.m. ET. The justices could face wide-ranging questions as the high court seeks millions of dollars to beef up security amid a rise in threats to the judiciary. Down the street, U.S. President Donald Trump will welcome new Iraqi Prime Minister Ali al-Zaidi to the White House after strongly backing the political novice’s bid for office. Iraq has been under pressure to disarm Iran-backed militias that attacked U.S. bases and diplomatic facilities after the U.S. and Israel instigated the Iran war. The U.S. launched more strikes on Iran early Tuesday, hours after Trump vowed to reinstate an American blockade of Iranian ports and charge ships 20% of their cargo for safe passage through the Strait of Hormuz. Iran responded with more attacks on Middle East allies, leaving the ceasefire deal in tatters and under the threat of all-out war. The U.S. military said it will resume its naval blockade on Tuesday at 4 p.m. ET. The Latest: Attacks resume across the Mideast The U.S. military’s Central Command said it struck several areas in Iran, targeting “coastal defense systems, missile and drone sites and maritime capabilities.” Iran acknowledged the strikes, but provided no immediate casualty or damage assessments. “These strikes will continue imposing a heavy cost on Iranian forces and degrade their ability to attack innocent civilians and commercial shipping in the Strait of Hormuz,” the U.S. military said. Moments after the military announced the new strikes, Trump called it “another major attack” and said the U.S. was “putting the blockade back.” Iran responded with attacks targeting Bahrain, Jordan and three tankers that traveled through the strait. Here's Trump's rationale for charging tolls in the strait U.S. Central Command said on social media that it “will enforce the blockade against vessels transiting to or from Iranian ports and coastal areas” beginning Tuesday at 4 p.m. EDT., and will “support traffic flow through regional waters for all vessels not violating the blockade.” A notice to mariners released Monday by the U.S. military warned of using force if ships don’t comply. It also said the military will let through humanitarian shipments. The statement follows Trump declaring that the U.S. would be reinstating the naval blockade and charging a 20% toll on eligible cargo. “We’re protecting a very rich portion of the world,” Trump said. “We’re spending money. And so, what we’ve done is, we are going to be reimbursed for protection.” Capt. Tim Hawkins, a spokesman for U.S. Central Command, would not say whether the military would be collecting tolls, and referred questions to the White House. Trump to address the nation on Thursday The president posted on social media that he would be “making a Speech to the Nation” at 9 p.m. EDT on Thursday. Trump appeared to refer to himself in the third person in the post. He did not disclose the details of his planned speech, but the announcement comes after Trump said he would block Iran-related ships from traveling through the Strait of Hormuz and that the U.S. would charge a 20% fee on all cargo going through the waterway. Asked in an interview with Hugh Hewitt what his Thursday address will be about, Trump made it sound like nothing out of the ordinary. “It’s just going to be a speech like a lot of my speeches,” he said, without offering any more detail.
The Latest: Supreme Court justices set to testify in rare appearance before Congress
Weeks after the end of a historic term, Supreme Court Justices Elena Kagan and Amy Coney Barrett will make a rare appearance before Congress on Tuesday at 10 a.m. ET. The justices could face wide-ranging questions as the high court seeks millions of dollars to beef up security amid a rise in threats to the judiciary. Down the street, U.S. President Donald Trump will welcome new Iraqi Prime Minister Ali al-Zaidi to the White House after strongly backing the political novice’s bid for office. Iraq has been under pressure to disarm Iran-backed militias that attacked U.S. bases and diplomatic facilities after the U.S. and Israel instigated the Iran war. The U.S. launched more strikes on Iran early Tuesday, hours after Trump vowed to reinstate an American blockade of Iranian ports and charge ships 20% of their cargo for safe passage through the Strait of Hormuz. Iran responded with more attacks on Middle East allies, leaving the ceasefire deal in tatters and under the threat of all-out war. The U.S. military said it will resume its naval blockade on Tuesday at 4 p.m. ET. The Latest: Attacks resume across the Mideast The U.S. military’s Central Command said it struck several areas in Iran, targeting “coastal defense systems, missile and drone sites and maritime capabilities.” Iran acknowledged the strikes, but provided no immediate casualty or damage assessments. “These strikes will continue imposing a heavy cost on Iranian forces and degrade their ability to attack innocent civilians and commercial shipping in the Strait of Hormuz,” the U.S. military said. Moments after the military announced the new strikes, Trump called it “another major attack” and said the U.S. was “putting the blockade back.” Iran responded with attacks targeting Bahrain, Jordan and three tankers that traveled through the strait. Here's Trump's rationale for charging tolls in the strait U.S. Central Command said on social media that it “will enforce the blockade against vessels transiting to or from Iranian ports and coastal areas” beginning Tuesday at 4 p.m. EDT., and will “support traffic flow through regional waters for all vessels not violating the blockade.” A notice to mariners released Monday by the U.S. military warned of using force if ships don’t comply. It also said the military will let through humanitarian shipments. The statement follows Trump declaring that the U.S. would be reinstating the naval blockade and charging a 20% toll on eligible cargo. “We’re protecting a very rich portion of the world,” Trump said. “We’re spending money. And so, what we’ve done is, we are going to be reimbursed for protection.” Capt. Tim Hawkins, a spokesman for U.S. Central Command, would not say whether the military would be collecting tolls, and referred questions to the White House. Trump to address the nation on Thursday The president posted on social media that he would be “making a Speech to the Nation” at 9 p.m. EDT on Thursday. Trump appeared to refer to himself in the third person in the post. He did not disclose the details of his planned speech, but the announcement comes after Trump said he would block Iran-related ships from traveling through the Strait of Hormuz and that the U.S. would charge a 20% fee on all cargo going through the waterway. Asked in an interview with Hugh Hewitt what his Thursday address will be about, Trump made it sound like nothing out of the ordinary. “It’s just going to be a speech like a lot of my speeches,” he said, without offering any more detail.
Futures Mixed Ahead Of CPI And Warsh Testimony, As IBM Sinks, Bank Earnings Fizzle
Futures Mixed Ahead Of CPI And Warsh Testimony, As IBM Sinks, Bank Earnings Fizzle US stocks are struggling for direction as traders waited to buy the dip on a busy day that kicked off with Wall Street earnings whichwith JPM, BofA, Goldman, Citi and Wells all reporting. Kevin Warsh’s testimony before Congress and CPI data are due later. As of 8:00am ET, S&P 500 futures fell 0.2% with Nasdaq 100 contracts up 0.6%, set for a rebound from the selloff in AI-linked names yesterday and defying declines elsewhere. In premarket trading, IBM crashed 20% - the most since 1987 - after unexpectedly preannouncing a big revenue miss; elsewhere, semiconductors are leading after Korea's Kospi staged a powerful rebound from session lows while SK Hynix saw a 10% swing in Korea trading; Mag7 is mixed, and the AI theme is bid. WTI crude traded around $80/bbl and Brent above $86/bbl (both off session highs) as the ceasefire / MoU appear to be voided with both sides claiming control of the SoH. Both Disc and Staples are lower, perhaps reflecting some consumer fears. Energy / Mats are bid on the Middle East, Fins are bid into earnings, Industrials are higher with the AI theme with HC mixed. Higher oil prices lifted odds of a July US rate hike in place, with swap markets signaling a nearly 40% chance of a hike when the Fed meets later this month. The yield on two-year UK gilts touched the highest level since May. Treasuries edged higher and the dollar fell. Traders will closely watch the CPI data, especially after the Fed’s Waller, a former dove, said Monday that a hike is on the table if inflation stays hot and as bond market volatility saw a double-digit jump. The recent fall in gasoline prices likely helped drag down the CPI print, which may notch its first monthly decline since the onset of the pandemic in 2020. The macro focus is on CPI plus the consumer / GDP read-through from GSIBs. The data calendar includes weekly ADP employment change (8:15am), June CPI (8:30am) and May TIC flows (4pm), Fed calendar includes Warsh’s testimony on its Semi-Annual Monetary Policy Report before the House Financial Services at 10am. Also scheduled to speak are Governor Barr (12:40pm), Chicago Fed’s Goolsbee (1pm) and Governors Cook (1:30pm) and Bowman (2:55pm). In premarket trading, Mag 7 stocks are mixed: Apple is down 0.7% after being cut to underweight at KeyBanc, which expects weaker device demand and service revenue growth in the US (Nvidia +1.2%, Tesla +0.3%, Amazon -0.4%, Alphabet -0.5%, Microsoft -2.8%, Meta Platforms -1.1%). IBM (IBM) sinks 19% after reporting preliminary quarterly sales results that missed analysts estimates, with Chief Executive Officer Arvind Krishna saying customers were holding back spending. Software and IT/professional services stocks are broadly lower after IBM’s preliminary revenue for the second quarter fell short of the consensus estimate. Microsoft falls 2.8%, Intuit drops 5% and Adobe declines 4.8% CoStar Group (CSGP) falls 5% after the real estate analytics firm named Robin Rossmann as the company’s next CFO. Rossmann will succeed Christian Lown, who is stepping down to pursue an opportunity outside the company’s industry. Goldman Sachs Group (GS) climbs 1.3% after posting $7.42 billion for a quarter with record-breaking stock-trading results, driven by financing and taking profit in arranging bets. JPMorgan (JPM) falls 2% after the lender said it sees full year adjusted expenses at about $107.5 billion, previously seeing about $105 billion. O-I Glass (OI) slips 3% after BofA cut its rating to underperform from buy, saying relative upside for the shares may lag due to volume weakness in glass packaging. Trex (TREX) climbs 3% after the decking manufacturer’s second-quarter net sales forecast beat the average analyst estimate. In other AI related developments Nvidia and Mitsubishi Heavy Industries are looking to tie up on AI data center technologies, Nikkei reported, and Samsung is said to be in early discussions for a potential US share sale. Memory and chip stocks remain the core equity theme after investors poured $21 billion into ETFs last week, according to JPMorgan. In other corporate news, Brown-Forman President/CEO Lawson Whiting is set to step down once a successor is named. BP said it expects to write down another $1 billion from energy transition assets in the second quarter, as the British major continues the painstaking work of re-orientating itself toward its core oil and gas business. Apple falls in premarket trading after being cut to underweight from sector weight at KeyBanc, which expects weaker device demand and service revenue growth in the US. Today's event-filled calendar began with a mixed reaction to Goldman Sachs, JPMorgan, Bank of America, Wells Fargo and Citigroup, as the banks were already priced to perfection, and despite blowout earnings, their stocks mostly dipped in premarket trading. June CPI data is expected to show some relief after inflation accelerated rapidly from March through May. Federal Reserve Chair Warsh is scheduled to testify before House members hours later. “Geopolitics on the margin is a negative, but the oil price has not spiked dramatically,” said Richard Flax, chief investment officer at Moneyfarm. “I expect Warsh will give a sort of data-driven speech rather than say too much about forward guidance. For us, it’s more about the inflation data.” Warsh would probably prefer not to present this week’s Humphrey-Hawkins testimony, but “Congress isn’t inclined to let Warsh off the hook,” writes Bloomberg Senior US Economist Andrew Sacher, who outlines what to expect from Warsh’s appearances. In an escalation of the standoff between the US and Iran over the Strait of Hormuz, President Donald Trump reinstated the blockade of Iranian ships transiting the waterway and demanded a 20% reimbursement for all other cargo. US forces also completed another round of strikes against the Islamic Republic. “We know the market can sustain far higher oil prices and US stocks keep rising,” said Alpesh Patel, managing partner at RootBridge Capital. “The only thing that matters is any indication rates are going to rise.” Global investors buying stocks aggressively should consider reducing exposure with investor sentiment getting extremely bullish, according to the latest BofA Global Fund Manager Survey, with positioning on US equities now at its highest level since December 2024 at a net 24% overweight, cash levels “uber-low” at 3.6%, and BofA’s Bull & Bear Indicator now at the extreme bull reading of 9. Overnight, China exports climbed 27% from a year earlier, exporting a record $412 billion worth of goods in June, blowing past all forecasts and turbocharged by a global investment supercycle in AI. In a sign of confidence that the artificial-intelligence buildout will keep on fueling demand for chips, people familiar said Samsung Electronics is exploring a potential offering of ADR, similar to SK Hynix, in hopes of top ticking the memory bubble. Semiconductor stocks bounced in early US trading after Monday’s rout. “This suggests that the Nasdaq could break its short-term negative correlation with the oil price, and rise alongside energy prices if this continues,” wrote Kathleen Brooks, research director at XTB. In Europe, the Stoxx 600 slid 0.4%, having dodged the weakness in tech stocks on Monday, is falling 0.6% with a drag from the media, travel and consumer sectors. Ericsson AB’s shares fell as much as 10% after warning that margins in its main networks business will come under pressure. Here are the biggest movers Tuesday: Mycronic shares gain as much as 14% to hit a record high as earnings from the Swedish electronics equipment group beat forecasts. DNB described the report as “impressive” BP shares surged as much as 3.3% to touch a one-month high as Jefferies noted that the oil major’s net debt estimates for the second quarter had undershot expectations Allegro climbs as much as 6.5% to highest since 2022 after the Polish e-commerce company reported strong preliminary 1H results and indicated it may raise its full-year outlook Salzgitter shares rise as much as 7.4% as Jefferies upgrades its rating on the steel producer to buy from hold, citing benefits from EU steel quotas Hapag-Lloyd shares rise as much as 8.2% in Frankfurt after the German container shipper boosted its Ebitda forecast for the year Genus shares rise as much as 14%, the most in about six months, after the animal genetics specialist said it now sees full-year profit ahead of market expectations Ericsson shares fall as much as 10% after the Swedish mobile networks and technology group said margins for its key Networks division will come under pressure in the second half of 2026, overshadowing otherwise in-line figures IntegraFin shares fall as much as 5.4%, the most in nearly two months, as the investment platform sees third-quarter flows come in slightly below some analysts’ expectations Norske Skog falls as much as 18%, the most since February 2025, after the Norwegian paper and forestry firm reported its latest earnings, which included misses on total operating income and Ebitda Norion Bank falls as much as 13%, the most since February, after the Swedish banking group reported weak second-quarter earnings. SB1 Markets points to an underlying miss in net interest income and higher costs Asian stocks reversed earlier losses as South Korean memory chipmakers rebounded in late trading. The MSCI Asia Pacific Index gained 0.4% after falling as much as 1.6% earlier in the session. Samsung was the biggest boost to the index amid news the company was in early discussion for a potential share sale in the US. SK Hynix also erased an early plunge, helping to lift the Kospi gauge. The movements in Korea’s memory chip stocks underscore the extreme volatility gripping some of the world’s biggest beneficiaries of the artificial intelligence boom. Japan’s Topix rose as investors looked for opportunities in non-tech sectors that have lagged the broader market. Taiwan’s Taiex index dropped 1.4% to its lowest in more than two weeks. The “recent volatility indicates you are starting to build two camps — one remains very optimistic, whereas you have a growing group that question the sustainability,” said Mattias Martinsson, chief investment officer at Tundra Fonder AB. “That creates a tug of war, from day to day, which has very little to do with geopolitical events. For today the optimists have the upper hand.” In rates, treasuries are little changed after retreating from session highs reached as oil extended its climb, with investors awaiting testimony by Fed Chair Kevin Warsh and June CPI report. US 10-year yield near 4.62% outperforms bunds and gilts in the sector by 2bp and 4bp following retreat from 4.634%, highest since May 20; curve spreads are also little changed. 2- and 5-year tenors reached new YTD yield highs. Around 11bp of Fed tightening is priced in for the July policy meeting following Monday’s increase on hawkish comments from Fed Governor Christopher Waller. Money markets see at least one Bank of England and one European Central Bank rate hike this year, while leaning strongly toward a second in December. IG dollar issuance slate empty so far. Monday saw a combined $6.7 billion priced as issuers paid about 2.7 basis points in new issue concessions on deals that were 5.5 times covered. In FX, the Bloomberg Dollar Spot Index is down by 0.2% and moves across currency markets remain relatively muted. In commodities, Brent extended its gain to $86/barrel on the new US blockade of Hormuz is driving more rate-hike bets from traders and rippling across the short-end of European bond markets. WTI crude oil futures are up about 3%, off session highs reached as the truce between the US and Iran collapsed following fresh attacks on shipping in the Strait of Hormuz. Gold is gaining to move back above $4,000/oz. The US economic data calendar includes weekly ADP employment change (8:15am), June CPI (8:30am) and May TIC flows (4pm), Fed calendar includes Warsh’s testimony on its Semi-Annual Monetary Policy Report before the House Financial Services at 10am. Also scheduled to speak are Governor Barr (12:40pm), Chicago Fed’s Goolsbee (1pm) and Governors Cook (1:30pm) and Bowman (2:55pm) Market Snapshot Top Overnight News President Donald Trump formally notified lawmakers this weekend that the nation is once again at war with Iran, giving his administration another 60-day clock to use the military in the region without congressional approval. Politico Brent topped $86 as Donald Trump said he would reinstate a blockade of Iranian ships transiting the Strait of Hormuz at 4 p.m. ET today. BBG For decades, OPEC influenced the market by how much oil it produced. But China, the largest importer, is demonstrating its remarkable power over prices. Typically the world’s largest oil importer, China slashed purchases this spring, reducing demand so much that it prevented oil prices from soaring even higher earlier in the war. WSJ Trump plans to back a Russia sanctions bill championed by late Senator Lindsey Graham, a person familiar said. His support would be a major win for Ukraine’s push to punish buyers of Moscow oil and gas. BBG China's exports surged in June, buoyed by orders for chips to fuel the global AI boom and automobiles, deepening producers' reliance on overseas buyers as policymakers in the world's No. 2 economy continue to grapple with how to boost demand at home. The stronger-than-expected trade performance keeps China on track to post a surplus topping $1 trillion for a second straight year, with factories sustaining sales despite slowing growth in major economies and trade frictions with Washington. RTRS Japanese policymakers on Tuesday flagged the possibility of changes to the asset allocation of the nation's giant state pension funds, though they offered no clues on the timing or scale of any shift. RTRS Over the past year, the Trump administration has made deals to acquire equity stakes in more than two dozen firms, an unusual practice that extended the government’s influence over industries including semis, nuclear energy, minerals, and quantum computers and steel. AI execs are increasingly wondering if they will be next. NYT Gov. Kathy Hochul is banning large data-center construction for up to a year, making New York the latest state to confront the rollout of sites powering the artificial-intelligence boom. The move responds to concerns over power costs, water supplies and community impacts as states consider limits on AI infrastructure’s effects on electricity grids and utility bills. WSJ As Warsh prepares to face Congress, traders now see a US rate hike later this month as a coin toss. Money-market pricing suggests traders boosted their wagers for a July increase to almost 50% after yesterday’s strikes on Iran. BBG US House will vote today on merging the SAVE America Act with a national security and State Department funding bill: Fox Trump said they're looking into whether Cuba is storing Iranian drones, while he added that they will take care of it if Cuba has Iranian drones. CPI Preview: Goldaman expects a 0.17% increase in June core CPI (vs. +0.3% consensus), corresponding to a year-over-year rate of +2.76% (vs. +2.9% consensus). The bank expects a 0.11% decline in headline CPI (vs. -0.1% consensus), reflecting lower energy prices. The forecast is consistent with a 0.24% increase in core PCE in June, reflecting another large increase in its financial services component. A more detailed look at global markets courtesy of Newsquawk APAC stocks were mostly in the red following the weak lead from the US, where risk sentiment was weighed on by tech selling and geopolitical escalation, while US-Iran strikes persisted for the third consecutive night and Trump announced to reinstate the naval blockade on Iran, as well as touted a 20% Hormuz shipping fee. ASX 200 was dragged lower by weakness in tech, industrials, consumer staples and financials, but with the downside stemmed by resilience in energy and utilities, while there was also an improvement in Westpac Consumer Sentiment. Nikkei 225 initially dropped below the 67,000 level amid tech weakness and higher oil prices, but then gradually nursed its losses and returned to flat territory as domestic yields softened. Hang Seng and Shanghai Comp conformed to the tech-related weakness and ultimately failed to benefit from the better-than-expected Chinese trade data. Top Asian News Japanese Finance Minister Katayama suggested it is time to consider including JGBs in NISAs, and stated that if the environment surrounding asset management changes sharply, a change to GPIF's portfolio could be examined, while she hopes to quickly establish details on steps to make Japanese government bonds more attractive. European bourses (STOXX 600 -0.6%) are lower across the board after Monday's choppy trade. Escalating US-Iran tensions return as a headwind for Europe, with energy prices rising, weighing on many of the continent's biggest industries (airlines, luxury). European sectors highlight the negative bias. Basic Resources (+1.3%) and Energy (+1.2%) are printing decent gains, while Utilities (+0.3%) and Chemicals (+0.2%) also trade in the green. To the downside is Travel & Leisure (-2.1%), Media (-2.0%), and Consumer Products & Services (-1.9%). Top European News EU Commission approved EUR 659mln German State aid for four new semiconductor facilities. German Wholesale Prices MoM (Jun) M/M -0.7% vs. Exp. 0.2% (Prev. -0.6%). UK BRC Retail Sales Monitor YoY (Jun) Y/Y 1.7% vs. Exp. 2.9% (Prev. 3.4%). FX G10s are mostly firmer as markets are reluctant to buy Dollars into US CPI, after it gained on Monday. Kiwi is the clear outperformer; energy exporters CAD and NOK also perform well. Geopolitics remain constructive for USD with Brent over USD 85/bbl, in addition to this, hawkish Fed speak from Waller saw markets assign a 50% probability of a Fed hike this month. (“Fed would need to consider a rate hike in the near term if core inflation is hot this week”). Despite these factors, the Buck is negative on the day as it stabilises below Monday’s 101.32 peak ahead of a packed session which is slated to see US CPI, and Warsh’s testimony to the US house which potentially sees a text release at 13:30 BST. The level to watch if momentum continues today is the 21DMA @ 101.00, should CPI come in hot, Monday’s 101.32 peak will be in focus, thereafter is July 2nd’s 101.43 high. Kiwi is the best performer once again as markets add to RBNZ tightening bets, interest rate futures now implying 58bps by year-end - around 5bps added vs. the end of Monday’s London session. Upside which comes after hawkish remarks from RBNZ's Conway and a strong quarterly NZIER Business Confidence. Fixed Income US and Iran continued to strike each other for a third night, after President Trump warned that they would hit Iran “very hard”. POTUS also announced a naval blockade on all Iranian ports, which is set to begin at 21:00 BST / 16:00 EDT. Crude benchmarks were firmer throughout the APAC session, though price action was more-or-less sideways. Into the European morning, the bias turned a bit more bullish after the UKMTO reported another incident on a tanker near Oman. This comes after two Emirati tankers were struck overnight. It is clear that the IRGC will not accept any transits through undesignated paths through the Strait of Hormuz; as such, traffic through the Hormuz is waning. Marine Traffic data has shown that only two tankers completed passages through the Hormuz in the 24 hours up to 07:25 BST today; this compares to c. 28 ships/day following the US-Iran MoU signing. As it becomes apparent that ships are no longer going through the Hormuz (and added risk of the blockade and/or nuclear attacks), the crude complex has moved higher. Brent Sep’26 (+3.7%) sits at the upper end of a USD 83.68-87.38/bbl range. Spot gold is a little firmer this morning, and trades within a narrow USD 3,983-4,034/oz range; currently holding just above the USD 4k/oz mark. The yellow metal appears to be taking a breather following a couple of sessions in the red, which was spurred by recent geopolitical escalations and a hawkish Fed speak via Waller. Elsewhere, base metals hold a positive bias following stronger-than-expected Chinese data overnight. In brief, Exports and Imports both rose from the prior, and by more than the consensus. 3M LME Copper holds within a USD 13,461-13,624/t range. Germany sells EUR 4.222bln vs exp. EUR 6.0bln 2.70% 2028 Schatz: b/c 1.13x, average yield 2.77%, retention 29.63%. Japan sells JPY 530.9bln 20-year JGBs; b/c 4.52x (prev. 2.97), average yield 3.626% (prev. 3.542%), Tail in price 0.00 (prev. 0.24). The Netherlands sells EUR 3.27bln vs exp. EUR 2.5-3.5bln 2.50% Jan 2031 DSL: Average yield 2.911% (prev. 2.795%). Australia sells AUD 400mln 5.00% June 2036 bonds b/c 4.1, avg yield 4.908%. Commodities A bearish start for benchmarks as the complex reacts to the overnight energy move. Action that was sufficient to push Bunds below the 125.00 handle and to a 124.82 base, lower by just over 40 ticks on the day. Since, no real reaction to the morning’s updates, including a UKMTO tanker report in Oman, despite modest energy upside at the time. For Germany, June’s WPI was dictated by energy, with the Y/Y moderating from the prior but at an elevated level as mineral oil products were just under 22% higher vs June 2025. However, the same component was down 6.8% M/M, leading to a -0.7% headline M/M print (exp. 0.5%, prev. -0.6%). No move to the series. Gilts opened lower by a handful of ticks before extending below the 87.00 handle, and then moving sharply lower to an 86.42 base, catching up to the above and continuing the pattern of greater magnitudes of action vs peers on energy-related moves. Pressure may also be a function of pricing into the Burnham coronation on Friday, as he will become UK PM from the point Starmer formally hands over. On that, Rathbones has reduced its Gilts holding in order to protect against “fiscal irresponsibility” ahead of Burnham and the Chancellor decision. Note, likely outgoing Chancellor Reeves speaks at Mansion House this evening. USTs also lower, down to a 108-17 trough given the energy move, which has seen a modest extension on the pressure after Fed’s Waller on Monday evening said another hot core inflation read would mean the Fed needs to consider a near-term hike. CPI today is seen at -0.1% M/M (prev. 0.5%), while the now even more pertinent core is seen at 0.2% M/M (prev. 0.2%). Following Waller and the recent energy moves, pricing for July has moved in favour of a hike, with around a 60% chance of a 25bps move currently implied. We now look to testimony from Chair Warsh, which is scheduled for after CPI; note, a text release alongside CPI is possible. BP (BP/ LN) says upstream production is expected to be between 2,170-2,220mboepd (prev. 2,339mboepd Q/Q), due to seasonal maintenance predominantly in the Gulf of America and the effects of disruption in the Middle East. Pakistan LNG is reportedly seeking an additional LNG cargo for July as US-Iran hostilities in the Strait of Hormuz constrain supplies from Qatar, according to Bloomberg. Turkey’s energy minister said Iraq requested retaining oil export capacity of 750K BPD through the Kirkuk-Ceyhan pipeline for 12 months under an agreement. Iran’s Oil Minister Paknejad said Iran’s oil exports continue as usual despite the US removal of oil waivers. Freeport-McMoRan (FCX) Indonesia unit is targeting 2026 copper production of 0.8bln pounds. Central Banks RBNZ Chief Economist Conway said the Middle East conflict complicates monetary policy like all supply shocks, while he added that understanding how firms respond to cost shocks is crucial in maintaining low and stable inflation. Furthermore, he said that despite easing prices, the effects of the shock are expected to continue impacting the economy for some time, and that a further reduction in monetary stimulus is likely to be required. BoE Governor Bailey said that the core banking system in the UK is resilient and that debt levels are not stretched. He stated that renewed hostilities in the Gulf underline continuing instability. The UK's position is supported by its fiscal framework as well as monetary policy. Geopolitics: Iran US President Trump reiterated that Iran has no air force, no navy and no military, while he said they will hit Iran very hard on Monday night and on Tuesday. Trump said they had a deal yesterday and that Iran breaks deals, as well as commented that the MoU was built to test Iran and that Iran didn't honour it. Trump also stated that they will hit 'Pickaxe Mountain' pretty soon and have their eyes on the site all the time, which is a good potential target US Central Command announced that it conducted and completed a third consecutive night of strikes against Iran, with US strikes reported in Bushehr, Bandar Abbas and Bandar Kangan, while explosions were also reported in Iran's Qeshm Island and Kish Island. More recently, there have been reports of explosions have been heard near Bandar Abbas, Bushehr and Choghadak. Details of US President Trump’s proposed Strait of Hormuz toll plan are still being finalised, according to Semafor, saying Trump is 'very serious about the tolls. Iran's armed forces have begun targeting US naval vessels in the Strait of Hormuz with cruise missiles, Al Mayadeen reported. Iranian Army Spokesperson said the Strait of Hormuz will not be open with US aggressions and war, SNN reported. IRGC said it targeted weapons warehouses, satellite communications centres, and US forces' housing building at Bahrain's Juffair base. Iran's army also targeted US military facilities and equipment in Kuwait with drones, as well as targeted a 'hostile' US vessel with cruise missiles, while it was separately reported that a US military base in Jordan was hit by a missile attack and that a missile attack hit an Iranian Kurdish opposition group site east of Iraq's Erbil. UKMTO received a report that a tanker was hit by an unknown projectile 40NM northeast of Qalhat, Oman. UKMTO reports of an incident 13NM southeast of Lima, Oman, the tanker was reportedly hit by a missile transiting outbound on the southern route The UAE Defence Ministry reported that two national tankers were targeted by Iranian cruise missiles in the southern Strait of Hormuz, with the incident occurring in Omani territorial waters, although the fires on both tankers were brought under control, and it reserved the right to respond to the escalation. ADNOC confirmed tankers "Al Bahyah" and "Mombasa B" were hit in the Strait of Hormuz. Oman’s Foreign Minister said complex talks are under way to make a long-term arrangement to guarantee freedom of navigation through the Strait of Hormuz. Geopolitics: Ukraine Russian ballistic missiles targeted Ukraine's capital of Kyiv, with sirens and explosions heard across the Ukrainian capital, according to FT. Russian forces conducted group strikes at night, damaging military industry and enterprises involved in missile production in Kyiv, while it damaged infrastructure facilities in Odessa, used to store Ukrainian armed forces' fuel and lubricants. Ukraine Navy spokesperson said Russia struck a civilian vessel near Ukraine’s Black Sea port of Odesa. Additionally, Ukraine said it struck two Russian oil refineries in the Bashkortostan and Krasnodar regions. US Event Calendar 6:00 am: Jun NFIB Small Business Optimism, est. 95.7, prior 95.3 8:30 am: Jun CPI MoM, est. -0.11%, prior 0.5% 8:30 am: Jun Core CPI MoM, est. 0.2%, prior 0.2% 8:30 am: Jun CPI YoY, est. 3.8%, prior 4.2% 8:30 am: Jun Core CPI YoY, est. 2.8%, prior 2.9% 4:00 pm: May Total Net TIC Flows, prior 26.1b 4:00 pm: May Net Long-term TIC Flows, prior 103.1b Central Bank Speakers 10:00 am: Fed Chair Warsh Testifies at House Financial Services Cmte. 12:40 pm: Fed’s Barr Speaks on Artificial Intelligence 1:00 pm: Fed’s Goolsbee in Fireside Chat 1:30 pm: Fed’s Cook Speaks at Conference on Financial Inclusion 2:55 pm: Fed’s Bowman Speaks at Conference on FInancial Inclusion DB's Jim Reid concludes the overnight wrap The most striking financial market takeaway is the extraordinary shift in Japan’s relative affordability over the past decade and a half. When we launched the series in 2012, Japan was one of the most expensive countries in the world, while the US sat towards the cheaper end of the spectrum. Today, that picture has completely reversed. Tokyo is now the cheapest city in the world in which to buy an iPhone, you can almost get two dates there for the price of one in London, enjoy three meals out for the cost of one in Zurich or New York, and buy property at a fraction of the prices seen in New York, Hong Kong and London. With Japan’s PPP-implied price level falling from 125 in 2012 to just 60 today, the report poses an intriguing question: if reading the 2012 edition would have encouraged you to buy America, should reading the 2026 edition make you take a fresh look at Japan? Tens of thousands of data points have been analysed to compare relative prices across 69 cities that matter to global financial markets. Click here to see where your city ranks on everything from everyday prices to overall quality of life and click now to get ahead of the 45,000 readers who might already be planning next year’s bargain holiday. Tokyo, perhaps? Staying in Asia, markets are again weak this morning on the back of the escalating tensions in the Middle East and the softening sentiment towards the AI trade. Oil is up just under another couple of percentage points this morning having been up around 9% yesterday. More on that below. The KOSPI (-0.02%) has actually fought all the way back to flat after being down -5% an hour ago when I started work on this. It might still be an hour until you read this so you may want to check yourselves. Elsewhere, the Nikkei (-0.25%) has been much less volatile but has also been recovering while I type. The Hang Seng (-0.47%), the CSI 300 (-0.39%), and the Shanghai Composite (-0.66%) are also lower. S&P 500 (-0.09%) and NASDAQ 100 futures (flat) have also been recovering as the overnight session has progressed but with Stoxx (-0.6%) futures still lower. Today we have a huge day with US CPI, Warsh’s testimony to the House and the unofficial start of Q2 US earnings season with 5 big banks reporting. Ahead of this and all the overnight moves, the big story yesterday was the latest jump in oil prices, which revived fears around stagflation, and hit bonds and equities on both sides of the Atlantic. That followed further strikes between the US and Iran over the weekend, which meant Brent crude (+9.59%) saw its sharpest rise since March 2020, reaching a 4-week high of $83.30/bbl by the close. Moreover, yesterday saw a fresh escalation in the rhetoric, with Trump saying that “We’re taking over the Strait”, before announcing that the US was reinstating an “Iranian blockade”, which Trump said was “so named because it is only stopping Iran’s ships or customers from entering or leaving. All other countries will have fair and open use of the Strait.” He also said that the US would “be reimbursed, at the rate of 20% on all cargo shipped, for any and all costs necessary to do the job of providing safety and security to this very volatile section of the World.” I asked AI how much that could raise if you assumed pre-war volumes. It came back with a figure of around $400-500m a day based on $2-2.5bn of daily cargo passing through the Strait. President Trump has a habit of starting with an extreme negotiating position so no doubt this would come down if it was ever implemented, but the very spectre of tolls will make markets and customers nervous. US Central Command said that it will resume the Iran blockade at 4pm NY time today, so that still leaves a bit of time for a possible climbdown. Yesterday’s mood out of the Middle East also wasn’t helped by escalation between Saudi Arabia and the Houthi rebels, with the latter targeting a Saudi airport after the Saudi-backed Yemen government carried out strikes against Sanaa airport. The escalation over Hormuz saw inflation concerns creep back into play yesterday, with investors pricing in more rate hikes from central banks. For instance, pricing of a Fed hike in just a couple of weeks’ time jumped from 34% to 43% yesterday and the amount of hikes priced by the December meeting was up +5.4bps on the day to 43bps. The Fed repricing was also supported by some hawkish comments from Governor Waller, who kept the door open to an imminent hike, saying that “If we get another hot reading on core inflation this week, then the FOMC will need to consider tightening monetary policy in the near term”. Similarly for the ECB, the number of hikes priced by December was up +10.5bps on the day to 44bps, so it was clear that higher oil prices were shifting market pricing in a hawkish direction. This backdrop also had a clear effect on sovereign bond yields, which continued to move higher on both sides of the Atlantic. So for US Treasuries, the 2yr yield (+7.6bps) closed at a 16-month high of 4.28%. And notably, the 2yr real yield (+2.2bps) closed at 2.23%, which was its highest closing level in almost two years. Meanwhile the 10yr yield (+6.3bps) was also up to 4.62%, marking its highest level in nearly two months, and the 10yr real yield (+3.6bps) closed at 2.34%, its highest since 2023. And over in Europe, yields on 10yr bunds (+4.3bps), OATs (+5.5bps) and BTPs (+7.0bps) all moved higher as well. Looking forward, the question of Fed rate hikes will be in focus today, as we’ll get the US CPI print for June at 13:30 London time. This is a significant one, because market pricing for the next Fed meeting is still in the balance, so any surprises could easily push that in either direction. In terms of what to look out for, the recent decline in gas prices means our US economists expect headline CPI to come in negative for June, with a monthly price decline of -0.16%. So if realised, that would take the year-on-year rate down to +3.8%. But core CPI is expected to still be more resilient at a monthly +0.23%, with the year-on-year rate at +2.8%. Whilst the CPI print will be the initial focus, attention will then shortly turn over to Fed Chair Warsh, who’s testifying before the House Financial Services Committee at 15:00 London time. That’s part of the regular semi-annual testimony from the Fed Chair, with the Senate Banking Committee hearing taking place tomorrow as well. But our US economists expect him to remain reticent about providing guidance for any upcoming policy action and remember that Warsh was the one official who didn’t submit a dot in the most recent dot plot. Whilst sovereign bonds were struggling, it was also a rough day for equities as the rise in oil prices coincided with a fresh slump for chip stocks. The Philly semiconductor index (-4.78%) fell back sharply, with the NASDAQ (-1.55%) also pulling back. And in turn, that slump for tech stocks dragged on the S&P 500 (-0.79%), with the index posting a sizeable decline despite most of its constituents rising on the day. Meanwhile in Europe, equities put in a relatively better performance, given the region’s comparatively smaller concentration of chip stocks and as European markets closed before the full rise in oil prices, with the STOXX 600 only down -0.01%. Finally, China’s latest trade data surprised to the upside overnight, with both exports and imports growing significantly faster than expected in June. Strong global demand for AI-related products and technology goods helped offset increasing geopolitical pressures. Exports rose 27.0% year-on-year, surpassing expectations of 19.0% and accelerating from May’s 19.4% growth. Imports increased 36.0%, well above the forecast of 26.1% and stronger than the previous month’s 27.4% rise. As a result, China’s trade surplus widened to $125.62 billion in June from $105.43 billion in May, exceeding market expectations of $120.10 billion. Looking at the day ahead, and the main data highlight will be the US CPI print for June. Otherwise, Fed Chair Warsh will be speaking before the House Financial Services committee, and we’ll also hear from the Fed’s Barr, Goolsbee, Cook and Bowman, along with BoE Governor Bailey. Finally, today’s earnings releases include JPMorgan, Citigroup, Goldman Sachs, and Bank of America. Tyler Durden Tue, 07/14/2026 - 08:24
Iran: Living in limbo between war and ceasefire
Iran: Living in limbo between war and ceasefire Since the ceasefire between Iran, the United States and Israel was announced, Iranians have repeatedly been told that the war is over. But at the same time, attacks, threats and diplomatic talks have continued. Iranian authorities talk about negotiations, progress and even sanctions relief one day, only to warn of retaliation, further strikes and threats to Iran’s critical infrastructure the next. This constant oscillation between war and diplomacy has left many people in Iran caught between hope and dread. READ: Iranians struggle to buy food as war drives up prices For many, that uncertainty has become more psychologically damaging than the war itself. The problem is no longer just the fear of violence, but also the inability to imagine a stable future. A society unable to plan One lawyer based in Tehran, who asked not to be named, told DW that the hardest part of the current moment is not knowing when the crisis will end. “The most important feature of this moment is that the end of the war is unknown,” she said. “When you cannot plan how to endure hardship, it puts enormous pressure on you.” She said she no longer has the motivation to work or start anything new. Even speaking freely in society feels difficult. In the city where she grew up in, she said, she now feels a sense of estrangement from some of the people around her. That sense of paralysis appears to go well beyond individual frustration, affecting basic decisions about work, family and the future. Combined with economic instability and the constant fear that violence could return at any moment, the result has been a wider mood of fatigue and social stagnation. “We are completely hopeless,” a resident of Isfahan city told DW. “This instability between peace and war has turned our mental state into a game, and we have no clear outlook for our future, or for our psychological and financial security.” READ: Iran after the war — fragile peace, shattered economy The same person said the entire experience had become deeply corrosive, with trust in either side of the war, or in the possibility of a durable agreement, having largely collapsed. Generation without a template for war The current uncertainty may weigh especially heavily on younger Iranians, many of whom have no direct memory of the 1980-88 Iran-Iraq war or of life under prolonged military threat. For them, this is the first experience of living under the shadow of an open-ended regional conflict. A nurse in western Iran told DW that when a society enters this kind of situation, trust in the future weakens and people begin postponing long-term decisions. “People start living as if the only goal is just to get through today,” she said on condition of anonymity. For a generation without direct experience of prolonged war, she added, the situation is more disorienting, not necessarily because they are weaker, but because they have no mental model for how to live through such a period. What many people are experiencing now is less fear of war in the narrow sense than exhaustion produced by uncertainty, she said. The nurse said the change is visible in hospitals and clinics, with patients being increasingly angry, dissatisfied and easily provoked. Even when services are good, she said, many remain upset. In her view, that anger is inseparable from the wider social climate. Anger, despair and emotional burnout Saeed Paivandi, a professor at the University of Lorraine in France, told DW that available data and field research point to two overlapping tendencies in Iran today: widespread despair about the future, and intense anger at the government’s inability to deal with ordinary life and govern effectively. READ: Iran after Khamenei: A new order takes shape Referring to a survey conducted by Iran’s Interior Ministry in May 2026, he said it found that around 60% of the population felt hopeless about the future. He also cited more recent survey findings published by IranWire, which he said showed anger in 64% of respondents, despair in around 50%, depression in 48% and fear and anxiety in about 45%. According to Paivandi, these figures show a clear deterioration compared with the last available survey before the mass anti-government protests and the authorities’ harsh clampdown earlier this year. He believes anger, depression and anxiety have all risen by roughly 10 to 12 percentage points. That suggests that the state crackdown, followed by the US and Israeli attack on Iran, has left a serious mark on how people feel about life, politics and the future. Paivandi also said the data point to another striking trend: around one-third of Iranians now express a desire to emigrate, with that figure rising among younger and more educated groups. Outside deal unlikely to resolve an inside crisis Against this backdrop, experts argue that Iran’s current psychological crisis extends beyond ceasefires, diplomacy and military escalation. While the external conflict matters, it has landed on top of a society already worn down by high inflation, repression, mistrust and a long-running sense of blocked opportunity. What makes the current moment especially difficult is that no side has offered people a clear and credible horizon. Instead, they are confronted with contradictory messages every day, making uncertainty a fact of daily life. And the longer that limbo continues, the more difficult it becomes to restore confidence — or sustain people’s energy needed to imagine any future at all. /dl
US attacks Iran and Tehran retaliates across the Middle East as both vie for control of strait
DUBAI, United Arab Emirates (AP) — The U.S. launched strikes on Iran early Tuesday morning, hours after President Donald Trump said Washington is “reinstating” a blockade on Iran in the Strait of Hormuz. Trump separately suggested the United States will charge other ships for safe passage, upending hundreds of years of American policy supporting freedom of navigation across the globe. Iran responded with attacks targeting Bahrain Jordan and two tankers associated with the United Arab Emirates traveling through the strait, killing one mariner and wounding eight others. The Emirates threatened to retaliate against Iran, potentially drawing the nation that is home to Abu Dhabi and Dubai back into fighting with Tehran. The attacks come as Iran and the U.S. vie for control of the strait through which a fifth of all traded crude oil and natural gas once passed in peacetime. The price of benchmark Brent crude oil rose to a one-month high of over $84 in trading early Tuesday, still well below the nearly $120 reached at the height of the war but threatening to make costs everywhere higher. Trump insists strait will be open The U.S. military’s Central Command said it struck areas around Abu Musa, Bandar Abbas, Bushehr, Chahbahar, Jask and Konarak, targeting Iranian “coastal defense systems, missile and drone sites and maritime capabilities.” Iran acknowledged strikes around those areas, but provided no immediate casualty or damage assessments. “These strikes will continue imposing a heavy cost on Iranian forces and degrade their ability to attack innocent civilians and commercial shipping in the Strait of Hormuz,” the U.S. military said. Moments after the military announced the new strikes, Trump called it “another major attack.” “We’re hitting them very hard. And it’ll continue, and we’ll see what happens,” he told reporters in the Oval Office. “We’re knocking out all of their offensive capability and we’re controlling the straits. We’re putting the blockade back.” Trump also provided new details on his suggestion that the U.S. will charge tolls for ships going through the strait, an about-face after previously saying that it wouldn’t. “We’re protecting a very rich portion of the world,” he said. “We’re spending money. And so, what we’ve done is, we are going to be reimbursed for protection.” It’s a change in U.S. policy that, until now, said the strait should remain open to all without tolls — as it was before the U.S. and Israel attacked Iran on Feb. 28. Any attempt by the U.S. or Iran to charge fees would violate global norms on freedom of navigation and raise tensions, likely causing further economic disruption far beyond the region. The U.S. Navy has fought for freedom of navigation on the seas since the Barbary Wars and the War of 1812. Attacks resume across the Mideast The United Arab Emirates’ Defense Ministry said early Tuesday that Iran attacked two tankers in the Strait of Hormuz, killing one mariner and wounding eight others. The Emirati Defense Ministry said Iran launched two cruise missiles at the tankers Mombasa and Al Bahiyah. The attacks set both tankers ablaze, though the fires were extinguished. Iran’s paramilitary Revolutionary Guard claimed the attack on the tankers, saying the vessels “ignored repeated warnings.” “They chose to pass through a minefield and were subsequently targeted and disabled,” the Guard said. Bahrain also came under renewed attack early Tuesday morning as Iran retaliated over the latest round of U.S. airstrikes. Bahrain sounded its missile alert sirens three times, urging the public to seek shelter. There was no word on any damage or casualties from the attack. The Emirati Defense Ministry said the attack on the tankers killed one Indian national and wounded six Indians and two Ukrainians. “The UAE reserves its full right to respond to this escalation and to take all necessary measures to protect its territory, its citizens and residents,” the Defense Ministry added. The Emirates used similar language before launching attacks against Iran during the war. Fighter jets could be heard overheard Tuesday morning in Dubai. The U.S. Embassy in Abu Dhabi and the U.S. Consulate in Dubai alerted Americans early Tuesday that consular appointments had been canceled through Wednesday “due to the regional security situation.” Jordan’s military said it intercepted four missiles from Iran, according to a statement carried by the kingdom’s state-run Petra news agency. Jordan hosts U.S. forces and has come under attack by Tehran in recent days. Trump says Iran failed a test Earlier Monday, Trump told conservative radio host Hugh Hewitt that the agreement reached last month was “built to test” Iran, adding that “when you’re dealing with sleazebags (agreements) don’t mean much.” “They didn’t honor the test,” the president said. Iran asserts it has the right to manage traffic through the strait and potentially charge fees in accordance with the interim peace deal. The U.S. has disputed that. The American military and the United Nations’ International Maritime Organization have tried to establish a route through the strait along the coast of Oman that would be outside of Iranian control. Iran has attacked ships using that route, saying the U.S. is violating the interim peace deal. The U.S. has attacked Iran in response, drawing Iranian attacks on U.S.-allied Arab states. Exchanges of fire in recent days had already cast further doubt on the interim peace deal. Washington had lifted a blockade it imposed in mid-April as part of that deal, which also called for the strait to be fully reopened. “We are reinstating the THE IRANIAN BLOCKADE,” Trump said on social media. “All other countries will have fair and open use of the Strait.” The president said the U.S. would be “reimbursed” by 20% of the value of cargo to help cover “any and all costs necessary to do the job of providing safety and security.” The U.S. military said it will resume its blockade of Iranian ports at midnight local Wednesday in Dubai.
Comfortably Bomb
Comfortably Bomb By Michael Every of Rabobank Hormuz update: Comfortably Bomb Summary The US-Iran MoU appears to have collapsed sooner than we had thought. With both sides striking the other, US efforts will turn to ensuring energy can flow through Hormuz ‘the hard way’ via escorting ships through it. For now, markets are saying the US can ‘comfortably bomb’ and ‘there is no pain’ even if the ‘MoU are receding’, mostly due to finite SPR drains and low Chinese oil imports. That gives the US a window for action: if it can keep enough oil flowing through Hormuz, which is our base case, it underlines military action can move markets in a desired direction; if it fails, we face a far larger energy crisis with far less in the tank as mitigants - or a geostrategic reckoning. We argued the June 17 US-Iran memorandum of understanding temporarily suited both sides but would last, at best, until the US midterm elections and would ultimately collapse due to its inherent contradictions over tolls, sanctions, Lebanon, and uranium. At time of writing on 13 July, the US and Iran have separately declared the “ceasefire” and “diplomacy” as over. Both were striking the other, albeit not yet all-out as at the start of the war. Typically, the IRGC has declared that the Strait of Hormuz is now closed - and the US that it is still very much open for business. There is no pain Regardless, the market response has been constrained. At Asian market open on Monday, Brent was only up around 4% to $79, for example (Figure 1). In short, markets continue to treat a new active conflict around the Strait of Hormuz as containable. That’s the case for several reasons. First, inventory draws have eased immediate pressure. Second, China is keeping its oil imports subdued. Third, some energy workarounds have emerged. Lastly, there has been some demand destruction. This is not a sustainable long-term dynamic, but for a few weeks, or months at most, the market may continue to say “there is no pain” in spot oil prices even if wide crack spreads were already telling another story on refined products before this latest fighting started. The key question is if this is a temporary or a longer-term geopolitical issue: arguably it’s both. However, the US may be gambling it can resolve the Hormuz situation to the energy market’s satisfaction before things become critical. MoU are receding The Hormuz disagreement stems from the MoU’s Article 5, which stated: “Upon the signing of this MoU, Iran will make arrangements using its best efforts for the safe passage of commercial vessels, with no charge for 60 days only, from the Persian Gulf to the Sea of Oman, and vice versa. The traffic of commercial vessels will immediately start, and considering the need for removing the technical and military obstacles, and de-mining by Iran, will be instated within 30 days. Iran will conduct dialogue with the Sultanate of Oman, to define the future administration and maritime services in the Strait of Hormuz, in discussions with other Persian Gulf Littoral States, in line with applicable international law and the sovereign rights of coastal states of the Strait of Hormuz.” Iran took this to mean it controlled all of Hormuz, including outside its own territorial waters, and could toll maritime traffic there. The US took it to mean that Iran couldn’t and set up an alternative toll-free route via Omani waters. Iran has since attacked ships using this alternative route. That was the proximate trigger for the latest rounds of US strikes on Iranian facilities on islands within Hormuz and along its coastline aimed at degrading Tehran’s ability to project control over the waterway; and of Iranian counterstrikes. The MoU therefore collapsed over the easiest of its contradictions to resolve, tolls, which could have been relabelled as ‘fees’. That presents a daunting challenge for market optimism as it implies US-Iran tensions are here to stay on multiple fronts. However, it also focuses the immediate problem –and US and Iranian attention– on physical control of Hormuz. A distant ship smoke on the horizon The message from US CENTCOM is clear: “The Strait of Hormuz is open to all vessels seeking to lawfully transit the international waterway. US forces are positioned and prepared to ensure that freedom of navigation remains available despite unwarranted Iranian aggression, harassment, threats, and arbitrary declarations. Iran does not control the strait. Traffic is flowing.” In pledging this, the US aims to ensure that Hormuz doesn’t bother markets the way that it did earlier in the war. That implies: 1. Taking out Iranian facilities in and along Hormuz so the threat to the southern Omani channel is diminished. 2. Providing defensive cover for ships passing through from drones, missiles, small boats, and mines, etc. 3. Shielding GCC allies, particularly their energy and critical infrastructure, but where stocks of missile interceptors are reportedly low. Very notably, Iran has so far not struck at these key GCC facilities again in recent attacks. That could suggest Tehran realises there are limits to what it can do to its neighbours if it also wants to offer alternative regional leadership ahead. These US tasks, mirroring the late-80’s Operation Earnest Will in the Iran-Iraq War's Tanker phase, may require help from the GCC and NATO. While US allies have been reticent to (publicly) act in this regard until now –and the Saudis blocked Operation Project Freedom with the same goal– that dynamic may change with the recent narrow avoidance of an energy crisis and the narrative that Iran alone is now blocking Hormuz. Moreover, it has been revealed that the US continued with a covert version of Project Freedom anyway without Saudi assistance. You are only coming through in waves It’s credible to assume US (and GCC/coalition) naval escorts with air cover could move substantial energy volumes through Hormuz via Omani waters even under duress. Recent operational data suggest the US military directly escorted tankers carrying significant amounts of oil successfully through the Strait. The US claims this was as high as 7 million barrels per day. Sustained throughput of meaningful amounts of oil and products via these military escorts appears theoretically feasible, albeit at higher costs from insurance premia and longer transit times. That turns a serious supply shock into a manageable disruption. At the same time, it’s realistic to expect that on top of a cancelled Iranian oil sanctions waiver, the US could reimpose its blockade on Iranian oil to increase economic pressure on it. We can also expect more efforts to build alternative supply chains and pipelines that avoid Hormuz as possible around it. None of them are a short-term palliative to match the Saudi East West pipeline to Yanbu, but in the longer run they will reduce Iran’s leverage even further. Your lips move but I can’t hear what you’re saying President Trump has called the Iranians “liars” and “scum” and Iran has stated it wants “revenge” and to kill him. Both sides have made their red lines explicit and have shown they are prepared to enforce them kinetically. The most positive near-term path is continued tit-for-tat pressure, punctuated by attempts at limited talks that produce little beyond contradictory statements. Markets pricing for a resolution of this crisis from a diplomatic perspective or a ‘TACO’ are likely wrong. However, US hard power could also achieve the same benign outcome. I can’t explain, you would not understand Markets and analysts are rightly confused by all the contradictory signals being seen around this crisis: declining inventories, wide crack spreads, the renewed cut-off of Iranian oil, intensifying military action and perhaps more later – yet energy prices have not blown out. It perhaps helps to underline who has been winning and losing and who could emerge as the final victor and how. This is not how I(ran) am Iran was heavily beaten militarily while exposing key US defensive weaknesses; then it was handed a win in peace negotiations due to energy market pressure on Trump; now, with oil prices contained, it has overplayed its weak hand and is under a new phase of US pressure: Iran could potentially lose effective control of Hormuz. Iran gets no sanctions relief as well as no oil sales if the US blockades it. Iran gets no assets unfrozen nor a $300bn in FDI for an economy shattered by the recent war. In Lebanon, peace progress has been on Israeli and Lebanese not Iranian/Hezbollah terms; Iran’s proxy in Syria has been lost and is working on a pipeline to help Iraq avoid Hormuz; Iraq’s pro-Iranian militias are being constrained by the government; the Houthis remain quiet; and Hamas has agreed to cede power in Gaza, if not disarm. Iran’s highly enriched uranium will clearly not be discussed, with reports Tehran is trying to rebuild its nuclear facilities. The US will have to address this too, but that perhaps via the air rather than boots on the ground, as in 2025. None of that means the US is aiming at regime change even if Israel says it is. Yet, Tehran could find itself regionally shrunken, economically ‘caged’, and geopolitically ignored. But that’s only if the US wins the Battle of Hormuz. As repeatedly stressed, a US defeat or retreat would flip the script. That’s why we have continuously argued the US will use kinetic force (and, if absolutely necessary, radical economic statecraft in the energy sector, i.e., NAFTA > NAPHTHA) I have become Comfortably Bomb Markets can therefore enjoy a form of geopolitical anaesthesia: “geopolitical risk equals higher energy prices” is not firing fully because so much oil has been injected into our global system. The US SPR cushion could last a few more months at current rates of depletion; so could Japan’s SPR; and China has kept its oil import volumes subdued and has vast reserves. Indeed, there’s little logic --beyond a statecraft escalation vs the US-- for China to restart buying oil aggressively while the US undertakes military action to try to free up Hormuz which, ordinarily, would suit China. (The only caveat being that Iran has promised a ‘friends and family’ discount to Chinese ships on its proposed tolls.) As such, the market seems to be telling the US to ‘comfortably bomb’ – but only on the unspoken assumption that its attempts to keep Hormuz open work. That is our geopolitical base case given the historical track record and the overall stakes. However, if it fails, and/or if Iran steps up its attacks against GCC energy and infrastructure regardless of the regional bridges (and refineries and desalination plants, etc) that it burns, then we would face a serious global energy crisis, and with much less left in the tank as potential mitigants. At the least, the US --with midterms looming-- would again have to pause until after them; and at the most, we could see the return of narratives heard a few months ago and still echoing in places - that the US is unable to use its military power to achieve its strategic goals, with enormous geopolitical and geoeconomic consequences. The full implications of that thought should be enough to leave any strategist comfortably numb. Tyler Durden Mon, 07/13/2026 - 22:00
Trump’s “Memorandum of Surrender”: The art of the deal meets the fact of defeat
Donald Trump is not negotiating with Iran. He is negotiating with the humiliation of having failed to break it. Beneath the ceasefires, memoranda, podium theatrics and sanctimonious appeals to “stability” lies a fact Washington cannot admit: the United States entered this confrontation expecting submission and emerged confronting its own limits. It wanted Iran isolated, disarmed and politically obedient. It wanted its deterrence shattered, its regional influence dismantled and its sovereignty reduced to a flag, an anthem and nothing more. It failed. Iran endured the pressure, preserved its strategic leverage and forced the most powerful empire on earth to negotiate with the country it had promised to bring to its knees. That is not an American victory. It is the management of an American defeat. Real diplomacy begins when both sides recognize that the other possesses interests, rights, red lines and power. Trump’s version begins from imperial theology: Washington has interests; Israel has rights; everyone else has obligations. American coercion is called deterrence. Israeli aggression is called self-defence. Iranian resistance is called escalation. Sovereignty is sacred when invoked by an American client and intolerable when asserted by an American enemy. This is the fraud now being sold as peace in the Gulf: a ceasefire presented as capitulation, an interim agreement marketed as surrender and a renewed campaign of pressure repackaged as de-escalation. Trump did not win the confrontation. He failed to produce the result he promised. Iran was not bombed into obedience. Its government did not collapse. Its strategic position was not erased. Its enemies discovered, once again, that destruction is not control and military superiority is not political mastery. For an empire addicted to command, the inability to compel surrender is defeat. READ: Trump says US likely to take control of Hormuz, expects other countries to contribute financially Trump’s response is therefore not to honor the agreement, but to hollow it out. Accept the document. Rewrite its meaning. Violate its logic. Impose new demands. Then accuse Iran of sabotaging peace. It is diplomacy by battering ram. The Strait of Hormuz is where this revisionism becomes geography. The attempt to reroute shipping through Omani waters is not a neutral administrative adjustment. It is an effort to strip Iran of the leverage that forced Washington to negotiate at all. “Freedom of navigation” is merely the varnish. The real demand is that Iran tolerate a hostile military order on its doorstep, surrender its principal strategic pressure point and accept that its sovereignty exists only when it is politically useless. Iran may possess rights, provided it never exercises them. It may retain leverage, provided Washington decides when it may be used. It may remain sovereign, provided it behaves as a subordinate. This is not peace. It is coercion translated into diplomatic jargon. The method is familiar: provoke, retaliate, moralize, escalate. Strangle the adversary economically. Threaten it militarily. Exhaust it politically. Then present concessions extracted under duress as the triumph of moderation. Washington calls this “managed escalation.” The phrase is obscene. There is nothing managed about pushing an entire region toward catastrophe and congratulating oneself for controlling the speed. Nor does the strategy stop at Hormuz. In Lebanon, the American-Israeli project is to transform Israeli security doctrine into Lebanese national destiny: isolate Iran, constrain Hezbollah and call the resulting submission “sovereignty.” In Syria, fragmentation remains useful because a sovereign, territorially coherent state would obstruct the endless manufacture of pressure points. A wounded country is easier to penetrate, divide and punish. The region is never allowed to heal because its wounds remain profitable. Different countries. Different instruments. The same imperial objective: reverse the political reality produced by war and reconstruct the appearance of American-Israeli supremacy after its material limits have been exposed. Israel’s role is not secondary. It is central, relentless and poisonous. Its political machinery in Washington treats any durable Iranian power as an intolerable violation of the regional hierarchy. It does not seek security in any reciprocal sense. It seeks permanent superiority: Iran contained, Lebanon vulnerable, Syria fractured and the Gulf militarized without end. Restraint may occasionally serve American interests. Permanent confrontation serves the Israeli project. Trump is the ideal salesman for this arrangement because his greatest political talent is not victory, but the theatrical conversion of failure into triumph. He needs a camera, a slogan and a captive press corps. If the battlefield will not produce surrender, the press conference must counterfeit it. A document is signed. Trump declares victory. The media repeats the phrase. The coercion resumes. The performance becomes the policy. READ: Iran says won’t allow US to ‘interfere’ in Strait of Hormuz management But Iran has already achieved what Washington was determined to prevent: it survived, preserved deterrence and forced the empire to confront the limits of its power. That is a strategic victory. Not because Iran escaped damage. Not because the confrontation was costless. But because the central American objective — submission — was denied. Iran did not merely resist an attack. It exposed the distance between imperial spectacle and imperial capacity. It demonstrated that the United States and Israel can devastate, sanction and threaten, but cannot automatically dictate the political outcome. That is the defeat Trump is trying to disguise. Tehran must therefore treat any agreement not as a gift from Washington, but as a battlefield whose terms remain contested. An agreement that binds only Iran while leaving the United States free to reinterpret, pressure and punish is not diplomacy. It is an ultimatum disguised as diplomacy. Restraint without reciprocity is not prudence. It is permission. Permission to rewrite the terms. Permission to escalate without cost. Permission to demand surrender after promising peace. The central question is not whether Trump can stage another ceremony. It is whether the United States can tear up every agreement that fails to produce obedience. Peace cannot be built on coerced submission and renamed stability. Victory cannot be manufactured at a podium while the balance of power says otherwise. Trump wants Iran to surrender the leverage that defeated his strategy so he can announce that he won. Iran’s task is to deny him the fiction. To preserve its rights, consolidate its gains and make clear that the empire’s declaration is not reality. It is merely an empire issuing orders to history — and discovering, once again, that history does not obey. OPINION: Pepe, Pakistan, and the last of the great foreign correspondents The views expressed in this article belong to the author and do not necessarily reflect the editorial policy of Middle East Monitor.
Futures Slide, Oil Surges As Iran War Returns, Chip Stocks Tumble As Korea, SK Hynix Crash
Futures Slide, Oil Surges As Iran War Returns, Chip Stocks Tumble As Korea, SK Hynix Crash US equity futures are lower on a combination of US/Iran escalation (which is feeding inflationary concerns) and a violent crash in South Korean stocks (which saw SK Hynix plunge by 15% overnight, the most on record, and unironically follows its record ADR launch in the US), which has put Semis and tech under renewed pressure. On the former, this drove oil prices higher overnight, but gains have been cut in half. On the latter, there is some anxiety around excessive capex spend (Goldman IG bond sales team warned over the weekend that demand for new hyperscaler supply has collapsed), but also some technical factors. As of 8:15am ET, S&P futs are down 0.4%, reversing their Friday gains which pushed the index just shy of a record; Nasdaq futures dropped 1% as Semis came for sale and Mag7 are mostly lower. Defensives are leading Cyclicals as the AI theme looks to be sold today but Fins / Energy are bid. Bond yields are up 1bp across the bulk of the curve with USD flat. Energy is leading commodity space those gains are materially off their highs with metals lower due to Precious metals; Ags are mostly lower. Today’s macro data is a non-event (June federal budget balance at 2pm ET) as the market awaits inflation / retail sales data as earnings kick off tomorrow. In premarket trading, Mag 7 stocks are mixed( Microsoft +0.3%, Alphabet +0.3%, Amazon +0.3%, Apple +0.2%, Meta -0.8%, Nvidia -1.2%, Tesla -0.6%) Agenus (AGEN) soars 46% after entering into a securities purchase agreement for a private placement of $85 million in upfront gross proceeds. American Express Co. (AXP) inches 1% higher after JPMorgan raised the recommendation on the company to overweight, saying the premium on the stock is warranted given the defensive nature of its revenues. Shopify (SHOP) is up 2% after Jefferies raised the stock to buy, saying second-quarter results will likely beat consensus. SK Hynix ADRs (SKHY) drop 8% after the stock fell by a record 15% in South Korean trading, underscoring growing investor concerns that its AI-fueled boom has become overstretched. TriCo Bancshares (TCBK) rises 7% after First Hawaiian agreed to buy the holding company for Tri Counties Bank. First Hawaiian (FHB) slips 6%. In other corporate news, TSMC reported quarterly sales rose 36%, meeting high expectations and signaling global demand for AI hardware remains intact. Apple sued OpenAI for trade secret theft, accusing the company of a coordinated campaign to steal information about upcoming products. Stellantis’s shipments climbed 10% in the second quarter fueled by growth in North America, as the maker of Jeep sport utility vehicles and Ram pickup trucks pushes on with a turnaround plan. Elliott is said to have built a large stake in car-insurance software provider CCC Intelligent Solutions, which has been exploring a potential sale. Conmed is said to be exploring options including a potential sale amid takeover interest from private equity firms. Worries that the artificial-intelligence boom has become overstretched sent chips stocks plunging in Seoul. SK Hynix, which has embodied the retail frenzy for AI and the popularity of leveraged ETFs that have fed wild swings in the stock, fell by the most on record in Seoul. Korea's Kospi also crashed, and suffered its 7th marketwide circuit breaker for 2026. Nasdaq 100 futures slid 1% as memory stocks such as Micron and Sandisk fell sharply in premarket trading. South Korea is increasingly shaping sentiment around the AI trade following the Kospi’s chip-driven outperformance this year. The rally has turned volatile in recent weeks as investors question whether AI hyperscalers’ spending will generate sufficiently strong returns to justify continued investment. Traders also pointed to the risk of a rotation into SK Hynix’s newly listed American depositary receipts, which surged on their debut on Friday. The ADR slid 7.9% in early trading on Monday. An escalation in violence in the Middle East weighed further on sentiment as the US and Iran exchanged strikes into Monday and issued conflicting claims over whether the Strait of Hormuz was open. The flare-up sent Brent as much as 5% higher before paring gains to trade 3.4% higher at around $78.50 a barrel. “The sharp selloff in Korean equities from the June peak is raising questions with some investors regarding the sustainability of the AI trade more broadly,” said Daniel Murray at EFG Asset Management. “With Middle East tensions rising again, this too has added to market consternation.” Beyond this morning’s knee-jerk reaction to Middle East escalation, investors face a packed calendar of major catalysts this week, including key US inflation readings, Warsh’s first testimony as Fed chair, major bank earnings and AI updates from ASML and TSMC. The week ahead is likely to herald a ramp-up in earnings volatility “where crowded trades will get audited,” notes Mark Taylor, director of sales trading at Panmure Liberum, who expects reactions to results to be “simple and asymmetric: beats are the baseline; misses are punished without mercy.” With tech set to dominate this earnings round, Taylor underlines the risk of disappointment “when extreme positioning, leverage and elevated expectations collide with even the faintest hints that AI-driven memory pricing and capex may not compound at the same pace indefinitely.” Investors need to see that AI demand is broadening beyond a narrow customer base, he adds. In politics, the death of Senate Judiciary Committee member Lindsey Graham leaves the panel without one of Trump’s staunchest allies as senators weigh Todd Blanche’s attorney general nomination. A California business tax credit cap aimed at saving $4 billion threatens to drive away film and television production, according to a letter signed by a bipartisan group of lawmakers. European stocks are muted with telecommunications and energy shares the biggest outperformers, while the tech and construction sectors lag. Stoxx 600 little changed at 641.30 with 255 members down, 332 up, and 13 little changed. Here are the biggest movers Monday: UK homebuilders rise after The Times reported that Andy Burnham, the UK’s presumptive next prime minister, is to be presented with plans to revive the “Help to Buy” program, a potential boost to sales and margins for the sector, according to JPMorgan analysts Akzo Nobel shares rise as much as 4.8% after the chemicals firm rejected Nippon Paint’s a €7.5 billion offer for its decorative paints business and said it would continue to pursue an agreed merger with Axalta Coating Systems Gjensidige shares jump as much as 4.7%, the most since September, after the Norwegian insurance company reported net income for the second quarter that beat the average analyst estimate Fraport gains as much as 3% after BNP Paribas upgraded the airport services company to outperform from neutral, citing improving cash flow outlook as the company’s decade-long investment cycle comes to an end Pagegroup shares rise as much as 10% after the recruitment company reported much better figures than feared during the second quarter, as analysts flagged improving trends across its markets DocMorris shares gain as much as 12%, the most since April 16, after the Swiss pharma retailer is upgraded to buy from hold at Deutsche Bank, with analysts noting fading funding risks and upside to earnings Plus500 shares fall as much as 15%, the most in six years, as the trading platform operator delivers an outlook that met, but did not surpass, current market forecasts Kongsberg shares fall as much as 8.5% after the firm reported Ebitda for the second quarter that Morgan Stanley called disappointing with few positive surprises and signifying a challenge to current valuation levels Oxford Nanopore shares plunge as much as 20%, the most on record, after the British DNA-sequencing company reported weaker-than-expected first-half revenue Asian stocks fell to the lowest in a month on renewed tensions in the Middle East and as SK Hynix shares in Seoul tumbled the most on record. The MSCI Asia Pacific Index dropped as much as 2.2%. SK Hynix sank 15%, while Samsung Electronics and Kioxia Holdings also declined. Korea’s Kospi index slumped 9%, triggering a market-wide trading suspension. “The selloff in Korea is a function of crowded positioning in memory stocks, especially in light of the renewed Middle East tensions and post the euphoria of SK Hynix ADR listing, said Vey-Sern Ling, managing director at Union Bancaire Privee. “Near-term rotation into valuation-depressed sectors like China tech could continue.” SK Hynix crashed the most on record in Seoul after its US-listed shares surged 13% on Friday. Traders attributed the selloff to profit-taking and investors shifting into the American depositary receipts. Chinese AI-related stocks also plunged amid concerns over rich valuations. Taiwanese stocks outperformed the broader Asian market as Taiwan Semiconductor Manufacturing Co. reported quarterly sales that matched analyst estimates. Investors are now shifting their focus to TSMC’s full earnings report on Thursday. Jakarta’s benchmark index gained 1.9%, the most in more than a week, after S&P Global Ratings affirmed Indonesia’s investment-grade score and stable outlook. In other moves, Nippon Paint Holdings fell 2.1% in Tokyo after it made an offer for Akzo Nobel NV’s decorative paints business in the past month. CATL’s shares in Shenzhen climbed 3% as Wall Street banks urged investors to accumulate shares after the recent slide. In Fx, the dollar barely budged. The yen slumped back below 162 after the GPIF said it does not plan to reallocate assets. In rates, treasuries are slightly cheaper across the curve. Bonds in Europe and Asia were the hardest hit, with the yield on two-year UK gilts up six basis points to 4.28%. The rate on 10-year Treasuries rose one basis point as traders added to wagers that the Federal Reserve will raise interest rates as soon as September, after a renewed push higher in oil prices as the US and Iran dispute whether the Strait of Hormuz is open, with the US carrying out another wave of strikes against Iran. Two-year Treasury yields touch highest since early 2025. Monday’s US session has few scheduled events. US yields cheaper by 1bp-2bp across a marginally steeper curve, the 10-year around 4.575% with bunds and gilts lagging by 1bp and 3bp in the sector; all are following WTI crude oil prices higher, which are up around 3.5%. IG dollar issuance slate includes three deals so far. No Treasury coupon supply expected until the 20-year bond reopening on July 22. In commodities, brent trades around $78/barrel to add to last week’s rise, though had come close to $80 earlier in the session and has been paring its gain. Iran said its memorandum of understanding with the US is in “crisis” and the two sides disagree on whether the Strait of Hormuz is open. Gold is dropping to move back below $4,100/oz, and Bitcoin is sinking too. The US economic data calendar includes June federal budget balance at 2pm; CPI and PPI reports are ahead this week. Fed calendar includes Waller at 12:30pm; Chairman Warsh is scheduled to testify on its Semi-Annual Monetary Policy Report before the House Financial Services and Senate Banking committees over next two days Market Wrap Top Overnight News The US and Iran exchanged fresh strikes while issuing conflicting declarations over whether the Strait of Hormuz is open to shipping. Oil up 3% BBG Over the past several weeks, the investment-grade corporate bond market has struggled to absorb a combined $75 billion of bond issuance from NVDA, SPCX, and AMZN. That marks a shift from earlier in the year, when investors were generally happy to hand money to so-called AI hyperscalers by any possible means. WSJ Warsh’s first big call will be whether or not to undo last year’s cuts. A steadier economy and stubborn inflation have put a rate increase in play. The new chairman, who testifies this week, hasn’t tipped his hand. WSJ Three prominent artificial intelligence developers released new models over the past week. They all promise to be more advanced, but their biggest immediate selling point may not be what they can do but how little they charge to do it. BBG China’s crude imports look poised to recover from a months-long slump as the country relaxes fuel export curbs, raises run rates and snaps up prompt Middle East supplies, with analysts and traders forecasting a return to strategic stockpiling later this year. BBG Taiwan Semiconductor Manufacturing Co reported a 67.9% year-on-year rise in its June sales on Monday, ahead of its second-quarter earnings release later this week. CNBC The yen weakened after Reuters reported that Japan has no plans to overhaul the GPIF’s asset allocation. Chief Cabinet Secretary Minoru Kihara said the GPIF routinely undertakes an appropriate review of its portfolio and will make amendments if required. BBG Meta plans to spend an additional $40 billion on its data center campus in Louisiana, bringing total costs to above $250 billion. BBG Companies from Silicon Valley to Europe are turning to Chinese AI models as they try to cut the cost of using the technology and reduce their dependence on US frontier labs. FT The distribution of investor views surrounding the path of monetary policy in coming months is wide. Goldman economists’ baseline forecast is that the FOMC will leave the policy rate unchanged this year but they assign a 25% probability to a scenario where the Fed hikes. Market pricing is more hawkish, reflecting a base case of nearly 50 bp of hikes through mid-2027, with uncertainty around that outlook. Option pricing signals greater than a 50% likelihood of hikes, but also substantial probabilities to scenarios where the Fed cuts or remains on hold. Conversations with clients reflect a similarly wide range of expectations. Investors also express an unusually wide distribution of views regarding the implications of any given Fed policy path for equities. Goldman Iran War Explosions were heard around Iran’s Bandar Abbas and Qeshm Island on Monday afternoon, Mehr News reported, while there is also the possibility of clashes in the Persian Gulf and the Strait of Hormuz. Reported fire at Kharg Island appears to be a result of routine flaring, according to Nour News. Iran's Foreign Ministry spokesperson said the US violated all clauses of the MoU in less than a month and stated that Iran will not execute commitments in the MoU as long as the US is not fulfilling its commitments. He added that the MoU is in "crisis" phase. Muscat talks with Oman were solely focused on the Strait of Hormuz. On the recent strikes, none of the US bases in any country in the region have been removed from the target list and that the defensive strikes of Iran are solely against the bases, facilities and positions used by the US to attack Iran, including their logistical and support facilities. In terms of further talks, mediators are still continuing their efforts to mediate between Iran and the US in recent days and Iran is in contact with mediators. Iran's IRGC said only way to open the Strait of Hormuz is to end US military interventions and respect the sovereignty of the countries bordering it. There is no clear timetable for Israel’s withdrawal from the experimental areas in southern Lebanon amid a policy of consolidation and non-compliance with the framework agreement, Al Araby reported citing sources. US President Trump threatened that the US military would “completely decimate and destroy all areas” of Iran if its leaders attempted or carried out an assassination on him. US forces said they struck 140 Iranian military targets on Saturday and were also reported to have carried out another round of strikes on Sunday, while Iran targeted at least five US allies across the Middle East in drone and missile assaults early on Sunday, as well as announced that the Strait of Hormuz would be closed until further notice. However, the Joint Maritime Information Centre said the path along the Omani coastline is still available for transit, while it was separately reported that a Chinese tanker transited through Hormuz via an Iran-designated route. US official said around 20 commercial vessels transited through the Strait of Hormuz in coordination with the US military over the last 24 hours, in addition to several vessels without US coordination, according to Axios. US military announced on Sunday evening that it began a new wave of strikes against Iran to continue degrading its ability to attack civilian mariners and commercial ships transiting the Strait of Hormuz, while Iranian TV reported explosions in Qeshm, Jask, Bandar Abbas and Sirik. US Central Command denied a claim by Iran that three US service members were killed in Kuwait, while it stated that there have been no reports of US casualties in the region, with all personnel accounted for and safe. CENTCOM later commented that it completed a new wave of offensive strikes on Iran, hitting dozens of targets at multiple locations to degrade Iran's ability to continue attacking international shipping flowing through the Strait of Hormuz. Kuwait’s military said three border posts were attacked and that a drilling platform owned by the Kuwait Oil Company was struck in a drone attack, while it was separately reported that US intelligence sources noted observations that Iran was preparing to carry out a massive attack on the UAE and Kuwait. Iran said it caused heavy damage to Jordan’s Prince Hassan Airbase, as well as claimed it targeted the Al-Udeid Airbase in Qatar and a US Navy logistics base in Dukm, Oman. Furthermore, Iran also targeted Kuwait and the US base in Bahrain. Iranian Supreme Leader Mojtaba Khamenei issued a written statement, vowing to avenge the death of his father and said that it was the demand of the nation. Iran’s Foreign Ministry condemned US attacks on Iranian infrastructure, which it said were a violation of the ceasefire deal and the UN Charter, while it warned Gulf states over the use of territory for US attacks. Iran's Deputy Foreign Minister Gharibabadi said no action against Iran should go unanswered and called for a pre-set response to any attempt against Iran, its military, Supreme Leader and officials. Iranian lawmaker and member of the Iranian Parliament’s National Security and Foreign Policy Committee, Kashkavi, said Iran prefers to manage the Strait of Hormuz through cooperation with regional states, particularly Oman, and stated that the clear official position is that future management of the Strait will be arranged by Iran. Iran denied social media reports that claimed the Bushehr nuclear power plant had been attacked, while its nuclear agency said all units continue to operate normally and that the plant is in a safe and stable condition. Iraq’s PM is to visit Washington on Monday, while oil and gas deals are expected to be announced, although the Islamic Resistance in Iraq warned the government against US economic deals and demanded a US troop withdrawal. Yemen’s Foreign Ministry reiterated that Yemen would continue its support of Iran in the face of ongoing US and Israeli aggression. Israeli artillery conducted further shelling in southern Lebanon, according to Lebanon’s National News Agency. A more detailed look at global markets courtesy of Newsquawk APAC stocks were pressured with the major regional indices all in the red following a fresh exchange of strikes between the US and Iran, which underpinned oil prices and yields, while Iran also declared the Strait of Hormuz would be closed until further notice. ASX 200 was dragged lower by underperformance in the tech, utilities, mining, materials and resources sectors, but with the downside cushioned by resilience in the top-weighted financial industry. Nikkei 225 pulled back from resistance around the 69,000 level with Japanese exporters pressured by higher oil prices and concerns of renewed shipping disruptions. KOSPI was pressured by chip-related selling amid heavy losses in the likes of Samsung Electronics and SK Hynix, despite the latter's strong debut last Friday on the Nasdaq. Hang Seng and Shanghai Comp conformed to the negative mood, albeit with the downside limited in Hong Kong as participants also digested preliminary H1 earnings updates and with China raising Southbound Bond Connect quota to USD 118bln. Top Asian News China raised the Southbound Bond Connect quota to USD 118bln, while the new quota represents a 60% increase for Hong Kong debt access. China’s nationwide electricity load hit a record high of 1.518bln kilowatts on Friday. China is cracking down on top ratings for corporate bonds with regulators pressuring agencies to limit AAA designations for high-interest borrowers, according to FT. Chinese AI lab Zhipu’s founder said frontier AI should remain broadly accessible instead of being controlled by select individuals. Japanese Chief Cabinet Secretary Kihara said GPIF to tweak its basic portfolio as needed. Japan entered the reusable rocket race with its first experimental rocket taking off and returning in a limited test flight by JAXA. South Korea July 1st-10th Exports rose 53.9% Y/Y (prev. +85.9%), Imports rose 17.4% Y/Y (prev. +35.6%), Trade Balance is at a provisional surplus of USD 6.36bln. European bourses (STOXX 600 -0.1%) start the week on the back foot but off worst levels, with price action being primarily driven by energy prices and the re-escalation of US-Iran tensions. European sectors have improved at the open, now printing a mixed picture. Telecoms (+1.9%) top the sector pile, followed by Energy (+1.2%) and Media (+0.6%). To the downside are Travel & Leisure (-0.4%), Construction (-0.8%) and Tech (-0.7%). Top European News BoE is said to be hit by internal divisions over shake-up, with critics stating that a failure to give clear signals is ‘confusing’ and risks wrongfooting the bond markets, according to FT. UK’s Burnham reportedly explores holding an expanded autumn Budget, with the incoming PM considering combining the fiscal statement with a spending review to set out his political strategy, according to FT. UK Chancellor Reeves is to focus on AI opportunities in her speech to the City on Tuesday, which is likely to be her last City of London event and final opportunity to defend her legacy. Spain approved a USD 8bln housing plan that would triple government spending in public housing over four years. FX G10s are mixed against the Buck. Kiwi continues to benefit from rate repricing; JPY underperforms amid the familiar terms of trade/differentials factors. USD fails to benefit from the lift in energy benchmarks, following constructive Iranian Foreign Ministry rhetoric this morning: “defensive strikes of the Islamic Republic of Iran are solely against the bases” and “Iran is in contact with mediators”. This pulled both the Buck and Energy off session highs. In addition to the focus on geopolitics, the Greenback positions into a number of key risk events this week including CPI and Warsh’s testimony. Price action since the emergence of London participants has been bearish, with DXY falling from an overnight 101.22 peak to a session low of 100.79. JPY underperforms amid the factors mentioned above, alongside the view that Finance Minister Katayama’s GPIF remarks last week were another episode of attempted verbal intervention. Source reports this morning noted Japan has no immediate plan to change target asset allocations of its state pension funds but could work within existing allowable ranges to direct more investment to domestic assets. A report which pressured the currency and saw it rise to a 162.35 peak as the source report further reduces the credibility of Katayama’s remarks (see 08:09 BST analysis). Kiwi is the best G10 performer as markets add to RBNZ tightening bets with two 25bp hikes now fully priced - a handful of bps more than the close on Friday. AUD/NZD trundled lower since the Sunday re-open, marking a session trough just below 1.20. Fixed Income Fixed income benchmarks initially fell at the open, as energy prices rose and a re-escalation of US-Iran tensions, but have come off worst levels at the start of European cash trade. Over the weekend, US forces struck 140 Iranian military targets on Saturday and took further action on Sunday, while Iran attacked US bases in the Gulf and announced that the Strait of Hormuz is closed. USTs (-1 tick) rotate in a 108-26+ to 109-01 range, with yields falling a touch from 4.60%. On the Fed speaker front, Fed's Waller is slated to speak later today, while a flurry of speakers are expected throughout the week. In terms of market pricing, the October meeting is the first fully-priced hike by the Fed, with a further hike fully priced by Apr'27. Bunds (-5 ticks) fell to a trough of 125.20 before coming off their lows, currently trading at session highs of 125.51. The data front from the EZ is quiet, with final inflation figures across the euro area slated for the week. On the supply front, the EU is to sell 3-, 7-, and 15-year Bonds. The sale should go fine, with the 3-year to receive decent demand. Gilts (-18 ticks) underperform. There has been plenty of political news over the weekend: 1) Burnham is considering a big budget in November, 2) a review of the Help to Buy scheme is on the table from Burnham, and 3) Chancellor Reeves to focus on AI opportunities at her Mansion House speech. The November budget will be highly-watched, as usual, with allies and experts reportedly pushing Burnham, who is set to become PM on July 20th, to consider a land tax, greater public control of utilities and a more ambitious devolution strategy. Some of the underperformance can be explained by the strength in the crude complex, given the UK's high reliance on external energy. Commodities Crude benchmarks jumped c. 3.7% overnight (vs current +2.3%) amidst the latest bout of US-Iran strikes, and after the Iranian’s announce that the Strait of Hormuz is shut until further notice. Traffic through the Strait has slipped to multi-week lows, with only 6 vessels passing on Sunday (lowest in five-weeks). As the European morning got underway, price action was fairly rangebound; however, some volatility was seen following comments by the Iranian Foreign Minister. He began the presser fairly hawkish, where he stated that Iran would not fulfil the MoU as long as the US doesn’t. Some modest upside was seen in benchmarks, but this was soon reversed after he stated that strikes against regional neighbours are “solely” against US bases. He also added that they are in contact with mediators. It is interesting that the FM has chosen to say that Iran is "solely" acting against US bases, rather than also mentioning energy facilities. It indicates, at least for now, that the country is attempting to avoid a wider escalation. However, overnight, the Kuwait Oil Company said that its drilling platform was struck. Brent Aug’26 trades firmer by c. 2.3% and holds towards the lower end of a USD 77.72-79.80/bbl range. Spot gold (-1.3%) extends lower this morning amidst the reemergence of inflationary woes, as energy prices grind higher this morning. Currently holding within a USD 4,044-4,075/oz range. Elsewhere, base metals are entirely in the red given the negative risk tone. 3M LME Copper (-0.3%) trades within a USD 13,364-13,480/t range. OPEC MOMR is expected at 13:00BST/08:00EDT. Kuwait has set its August OSP for extra-light crude to Asia at USD 5/bbl discount to the Oman/Dubai average. ADNOC sets the August OSP for Murban crude at USD 80.01/bbl. Iranian Customs has issued a directive to lift the ban on the export of chemical, polymer and petrochemical products. Trade/Tariffs EU is developing a “solidarity instrument” to support companies diversifying critical supplies away from China and cushion the impact of any Chinese retaliation in the event of a trade war. Geopolitics: Ukraine Ukrainian military announced a drone attack that hit 15 Russian ships in the Sea of Azov, including 7 oil tankers. Additionally, the Ukraine Security Service said it struck a Russian oil depot in the Stavropol region, as well as storage tanks at Kavkaz port. Ukraine’s military said it hit an oil refinery in Russia’s Samara region, while Russia also said that Ukraine struck a tanker in the Sea of Azov. Ukrainian President Zelensky ousted Ukraine’s premier Svyrydenko as part of a shift in political strategy and is mulling naming Naftogaz CEO Koretskyi or former PM Shmyhai for the role. EU failed to agree on the 21st round of Russian sanctions after negotiations on Sunday. Slovakia’s President Pellegrini said Slovakia will not be involved in the new EUR 70bln aid package for Ukraine, nor will it supply weapons to Ukraine or fund further rearmament. US Event Calendar 2:00 pm: United States Jun Federal Budget Balance, est. -128.25b, prior -292.65b 5:25 am: United States Fed’s Bowman Speaks on Financial Regulation 12:30 pm: United States Fed’s Waller Speaks at NYABE DB's Jim Reid As well as two epic World Cup semi-finals before that, and the start of the Open golf it’s a packed week ahead in markets. The headline events are tomorrow’s US CPI and Wednesday’s US PPI, alongside Fed Chair Warsh’s first Humphrey–Hawkins testimony before the House Financial Services Committee (tomorrow) and the Senate Banking Committee (Wednesday). Elsewhere, key data includes China’s Q2 GDP and their monthly data dump (Wednesday) and the UK’s May monthly GDP (Thursday) as well as the announcement of a new leader of the ruling UK Labour Party as a special conference on Friday. And just to keep everyone busy, Q2 US earnings season kicks off tomorrow with results from five major US banks. Q1 marked the strongest non-recessionary rebound since the late 1990s, so the bar is high. ASML (Wednesday) and TSMC (Thursday) should also provide an early read on global tech trends. Since Friday night, the US–Iran conflict has intensified sharply, with Washington launching multiple rounds of strikes targeting Iranian air defences, radar systems and missile and drone capabilities, while Tehran has responded with attacks across the region and against shipping. The exchange has increasingly centred on the Strait of Hormuz, where Iran has claimed the waterway is effectively closed and warned vessels against transiting, even as US officials insist it remains open and are actively escorting commercial traffic. Reports of damage to vessels, intercepted missiles and drones, and strikes on military and energy-linked sites across the Gulf underscore the widening scope of the conflict. Oil markets have reacted, with Brent (+4.12%) climbing above $79 per barrel and US Treasuries back up a couple of basis points across the board. S&P (-0.56%), Nasdaq (-1.34%) and Stoxx (-0.95%) futures are all lower. In addition, the Asia tech trade is seeing another slump overnight with the KOSPI (-7.96%) again the weakest performer, amid renewed semiconductor losses. The Nikkei (-2.31%) is also sharply lower. Elsewhere, the Hang Seng (-0.12%) is posting more modest declines, while mainland Chinese equities are under greater pressure, with the CSI 300 (-1.34%) and Shanghai Composite (-1.54%) both trading significantly lower. So a challenging start to the week. Looking forward now, let's run through the key details of the week ahead we previewed at the top. Front and centre is tomorrow’s US CPI report. Our economists expect lower gas prices to pull headline CPI down by -0.16% (vs. +0.47% in May), with core at +0.23% (vs. +0.21% previously). On a year-over-year basis, headline inflation is projected to fall from 4.25% to 3.81%, while core eases only marginally by 2bps to 2.83%. Wednesday’s PPI will help complete the picture for core PCE. Our economists’ forecast is for a +0.23% increase (vs. +0.32% last month), which would see the year-over-year rate decline by 3bps to 3.38%. Within the details, the price index for portfolio management and investment advice will be worth watching, particularly given the boost from May’s equity rally. After a relatively quiet spell for Fed speakers, this week brings a wave of communication ahead of the blackout period starting at the end of the week. Governor Waller begins today with a speech at NYABE. Chair Warsh follows with his testimony on Tuesday and Wednesday, while additional commentary comes after the CPI release (Governor Cook on Wednesday, and Vice Chair Jefferson, Dallas Fed’s Logan, and Kansas City Fed’s Schmid on Friday). This week effectively represents the final window for policymakers to signal their thinking ahead of the July FOMC meeting. We expect Warsh to broadly stick to recent messaging and avoid firm guidance on near-term policy moves. In contrast, Waller has historically been more explicit about their reaction function, so today’s speech will be closely scrutinised for clues on their preferred policy path—even though it arrives before the CPI data. Turning to the rest of the data calendar, Thursday’s June US retail sales and Friday’s industrial production will feed into estimates for Q2 real GDP growth. The preliminary University of Michigan survey (52.0 expected at DB vs. 49.5) on Friday will also be in focus, particularly inflation expectations, which have started to moderate from a high level after recent energy-driven increases. On earnings, tomorrow features JPMorgan, Bank of America, Goldman Sachs, Wells Fargo and Citigroup. Wednesday brings Morgan Stanley alongside ASML, Johnson & Johnson and BlackRock, offering a useful cross-sector snapshot. Thursday is especially busy, with TSMC, Netflix, General Electric and UnitedHealth reporting across tech, industrials and healthcare. By Friday, attention shifts to European names including Volvo, Sandvik and Saab, rounding out the global picture. Staying with the global theme, central bank decisions from the Bank of Canada (Wednesday, no change expected) and the Bank of Korea (Thursday, DB forecast a +25bp hike) will also be in focus. In China, growth is expected to slow to 4.4% YoY in Q2 (from 5% in Q1), with June activity data released alongside. More detail is available in our Chinese economists’ full week-ahead note here. Finally, the UK reports May monthly GDP on Thursday, the day before Andy Burnham is expected to be confirmed as Labour Party leader, ahead of him officially taking the PM reins a week today and tapping into the England World Cup winning celebrations. Oh wait this must be another major hallucination. Recapping last week now and the main news was the re-escalation between the US and Iran, which led to a decent jump in oil prices as investors priced in more disruption around the Strait of Hormuz. Indeed, Brent crude was up +5.39% last week (-0.38% Friday) to $76.01/bbl. And even though it still left oil prices well beneath their peak earlier in the year, it still revived fears about more persistent inflation. That oil price spike hit European assets in particular, given the continent’s greater exposure to an energy shock. So sovereign bond yields saw a decent jump, with those on 10yr bunds up +13bps (-1.7bps Friday) to 3.06%. Moreover, investors also priced in a more hawkish ECB, with the amount of further hikes priced by December up +12.9bps on the week to 34bps. For equities, there was also a decent hit, with the STOXX 600 down -1.79% (+0.04% Friday), marking its biggest weekly decline since April. Over in the US, markets put in a relatively stronger performance, with equities supported by a stabilisation in chip stocks. That saw the Philly semiconductor index recover +2.70% (+0.06% Friday), with the S&P 500 ultimately up +1.23% (+0.42% Friday). Meanwhile, US Treasury yields also saw a more muted rise relative to Europe, with the 10yr yield only up +7.8bps (+1.0bps Friday) to 4.56%. Otherwise, there weren’t too many headlines from other asset classes. In FX, the dollar index was marginally unchanged, with a +0.09% rise. And in US credit the moves were also fairly muted, with US IG (+1.9bps) and HY (-4.3bps) spreads seeing small moves. However, there were slightly bigger moves in European credit, where Euro IG (-1.9bps) and HY spreads (-12bps) both tightened. Tyler Durden Mon, 07/13/2026 - 08:48
The Latest: Trump says US will blockade Iran in Strait of Hormuz and charge ships for safe passage
The Latest: Trump says US will blockade Iran in Strait of Hormuz and charge ships for safe passage U.S. President Donald Trump said Monday that Iranian ships will no longer be able to travel through the Strait of Hormuz and America would charge a 20% toll on other countries’ eligible cargo, escalating tensions after weekend of attacks by both nations to assert control of the critical waterway. The U.S. military then began another round of strikes against Iran on Monday. Lindsey Graham’s sister, Darline Graham Nordone, has been named as her late brother’s temporary replacement in the U.S. Senate. Graham, one of Trump’s closest allies in Congress and an advocate for U.S. military aggression in Iran, died Saturday at 71 after a tear in his aorta. The Latest: Moments after the U.S. military announced a new round of strikes on Iran, Trump called it “another major attack.” “We’re hitting them very hard. And it’ll continue, and we’ll see what happens,” he told reporters in the Oval Office. The president added: “We’re knocking out all of their offensive capability and we’re controlling the straits. We’re putting the blockade back.” Trump also provided new details on his administration doing an about-face and suggesting that it will charge tolls for ships going through the Strait of Hormuz, after previously suggesting that it wouldn’t. “We’re protecting a very rich portion of the world,” he said. “We’re spending money. And so, what we’ve done is, we are going to be reimbursed for protection.” The move to shrink Bears Ears and Grand Staircase-Escalante national monuments unravels protections established by former presidents for areas with unique archaeological and historical features. It comes as Republicans under Trump have sought to drastically reshape the management of vast taxpayer-owned lands concentrated in Western states. Republicans have moved to expand oil and gas drilling, ramp up logging and remove habitat protections for imperiled species. The altered monuments had been designated under the Antiquities Act, a 1906 law meant to preserve important sites. Democrats and conservationists warn of the disposal of treasured landscapes for commercial gain. “These strikes will continue imposing a heavy cost on Iranian forces and degrade their ability to attack innocent civilians and commercial shipping in the Strait of Hormuz,” the command said on social media. The strikes are just the latest volley between the two nations that began last week after Iran attacked a series of merchant vessels off the coast of Oman. When asked in an interview with Hugh Hewitt what his Thursday address will be about, Trump made it sound like nothing out of the ordinary. “It’s just going to be a speech like a lot of my speeches,” he said, without offering any more detail. “Memorandum of understanding when you’re dealing with sleazebags don’t mean much,” Trump said during an interview with Hugh Hewitt. Trump said he questioned why the U.S. was entering into a memorandum of understanding to create a ceasefire with Iran rather than moving toward a full deal first. Trump last week declared the ceasefire was “over.” “They didn’t honor the test,” Trump said. “We’re going to hit them very hard tonight and we’re going to hit them hard tomorrow — and there’s not a damn thing they can do about it,” Trump told conservative radio host Hugh Hewitt. “They have nothing. They have nothing going, other than they have big mouths.” The president did not elaborate but him saying that more strikes were coming previously preceded a new round of U.S. military strikes on targets in Iran. Lindsey Graham’s sister, Darline Graham Nordone, has been named as her late brother’s temporary replacement in the U.S. Senate. South Carolina Gov. Henry McMaster announced at a news conference at the Statehouse on Monday that Nordone would serve the remaining months on Graham’s current term, which expires in January. A person familiar with the appointment process but not authorized to speak about it publicly said Nardone would be sworn in Wednesday. She will be the first woman to represent the state in the U.S. Senate. “It is such an honor,” Nordone said. “Lindsey has always been there for me. And now, I will be there for him.” Graham died over the weekend at age 71. He never married or had a family of his own, but Nordone was often by her brother’s side for the political touch points of his career, speaking at events and appearing in some of his campaign ads. Graham’s desk was covered in black cloth and a vase of white roses as the Senate opened Monday afternoon. Senate Majority Leader John Thune eulogized Graham as a friend and a statesman, saying he “died with his boots on” because he had just returned from his 10th trip to Ukraine. One day “we will laugh together again,” Thune said, tearing up during his opening remarks. Iowa Sen. Chuck Grassley, the seniormost Senate Republican, said he was used to being the butt of Graham’s jokes. He “always brought a smile to your face and levity to the halls of Congress,” Grassley said. Grassley said the Senate could “show our appreciation” for Graham by passing a bipartisan package of Russian sanctions that Graham introduced on Friday, just before his death on Saturday. That’s after a Navy pilot died in a helicopter crash on July 1 in the Arabian Sea. The Navy initially called it an emergency landing and said there was “no indication the emergency was caused by hostile action.” The Pentagon’s war casualty count added one non-hostile death in July. A U.S. Central Command spokesman confirmed it was the pilot. It’s the first death since 13 service members were killed in two separate incidents in March at the beginning of the war. A total of 414 service members have been wounded, including a U.S. Air Force member added Monday. While Iran and the U.S. have resumed strikes, it’s unclear if that’s what led to the injury. U.S. Central Command and the Air Force wouldn’t offer details. Most troops were wounded in March, while 34 were wounded in April and three in June. The president posted on social media that he would be “making a Speech to the Nation” at 9 p.m. EDT on Thursday. Trump appeared to refer to himself in the third person in the post. He did not disclose the details of his planned speech, but the announcement comes after Trump said he would block Iran-related ships from traveling through the Strait of Hormuz and that the U.S. would charge a 20% fee on all cargo going through the waterway. The U.S. military says it will resume its blockade of Iranian ports Tuesday at 4 p.m. EDT. U.S. Central Command said on social media that it “will enforce the blockade against vessels transiting to or from Iranian ports and coastal areas” and will “support traffic flow through regional waters for all vessels not violating the blockade.” A notice to mariners released Monday by the U.S. military warned of using force if ships don’t comply. It also said the military will let through humanitarian shipments. The statement follows Trump declaring that the U.S. would be reinstating the naval blockade and charging a 20% toll on eligible cargo. Capt. Tim Hawkins, a spokesman for U.S. Central Command, would not say whether the military would be collecting tolls as part of the blockade and referred questions on Trump’s post to the White House. The International Maritime Organization, the United Nations agency which oversees safety and security measures in international shipping, said the group was waiting to find out more about Trump’s proposal but said its stance on tolls remains unchanged. “We have always been consistent on its stance on fees – IMO stands firmly against charging fees for passage through straits used for international navigation. There is no legal basis through which to introduce mandatory tolls simply to transit through a strait,” the organization said in a statement. Trump’s announcement comes after Secretary of State Marco Rubio met with Gulf leaders late last month and said the U.S. would not support Iran charging fees for ships to go through the Strait of Hormuz. “That’s international waterway. There isn’t a nation on Earth that supports having to pay money to go through the Straits,” Rubio told reporters in Bahrain on June 25. Rubio also said there was “zero support among the Gulf countries for any sort of toll or fees or anything that charges for the use of international waters. The president’s made it clear that’s not going to happen. It’s not going to be a part of this. It cannot be a part of this.” A federal judge said Monday that Trump’s lawsuit against the IRS over his leaked tax returns was filed for an “improper purpose” as she referred attorneys for disciplinary actions. The ruling from U.S. District Judge Kathleen Williams amounts to a stinging rebuke of the Republican president’s lawsuit, characterizing it as an exercise in self-dealing in which he sued an entity that is effectively under his control. The suit concluded in May with a settlement agreement that created a since-abandoned $1.776 billion fund meant to compensate allies of the president, as well as immunity from tax audits. “This was an attempt to use the Court to provide some legitimacy to an agreement to confer immunity to people and entities affiliated with the President and to earmark billions of dollars from American taxpayers to redress grievances not defined in the law,” the judge wrote. U.S. Central Command says it used drone ships to hit an Iranian ship maintenance facility and submarine, calling it first. “Three Corsair unmanned surface vessels hit the port at Bandar Abbas Naval Base, marking the first time American forces have employed sea drones in combat operations,” the command said on social media Monday. The post featured video of the drone boats approaching a dock that had a submarine sitting on top of it followed by aerial footage of the explosion on Sunday. The strike comes despite the Trump administration’s claim that it has completely destroyed Iran’s navy. The Corsair drones also were used to help rescue a pair of Army aviators from the waters off Oman early in June after their Apache helicopter was struck by an Iranian drone. Democrat Ryan Fecteau posted on Facebook that the shooting Monday in Biddeford, outside Portland, involved U.S. Immigration and Customs Enforcement, that the State Police and Maine Department of Public Safety were at the scene, and that he expects the FBI to investigate. Few details are available. ICE, the FBI and the Maine Department of Public Safety did not immediately respond to requests for comment. Project Relief, an immigrant rights advocacy group, posted that “a young person” from its community was killed “during an encounter with ICE in Biddeford.” Protesters have already begun gathering at Mechanics Park in Biddeford. This would be at least the ninth death from an encounter with federal immigration officials since the start of the Trump administration’s mass deportations agenda and the second in a week, following the killing of a Houston man. The European Union coordinated efforts to raise 900 million euros ($1 billion) in aid for Gaza, working with 65 governments and organizations including the White House and the United Nations, the bloc’s top diplomat said Monday. Kaja Kallas announced the fund after a meeting of the Palestine Donors Group in Brussels. “The EU is the most credible supporter, for the Palestinian people. We are the largest donor and the strongest backer of the two-state solution,” she said. The meeting was the second gathering of the Team Gaza Initiative, an effort by the EU to rally support for recovery projects like sanitation and farming in the destitute and war-ravaged coastal enclave of some 2 million people. Just days before his death, Republican Sen. Lindsey Graham was standing in Kyiv’s St. Michael’s Square, giving Ukrainians reason for optimism: He said new hard-hitting bipartisan economic sanctions against Russia were within reach back in Washington. Now Ukraine’s leaders are devastated. Graham had been one of Kyiv’s closest allies in Washington and a trusted intermediary with Trump, who had a strained relationship with Zelenskyy. They fear that without Graham, Ukraine’s ability to influence could be diminished across a broad range of issues. “Huge and absolutely unexpected loss,” said Oleksandr Merezhko, a lawmaker with Zelenskyy’s party. “He was the closest link between Ukraine, our president and Trump,” he added. “Our position in Trump’s entourage might be weaker.” Ukraine and nine other countries have formed a coalition to protect Europe from ballistic missiles. The 10 countries announced the agreement at talks with Ukrainian President Volodymyr Zelenskyy in Paris on Monday, taking advantage of Kyiv’s experience of fighting Russia. “Our goal is to build a shared ballistic missile defense capability for Europe,” their statement said. Zelenskyy went to France seeking help against Russia’s ballistic missiles, which have pummeled his country in the more than four years since Moscow launched a full-scale invasion. Putin was unyielding after Kyiv’s long-range attacks on refineries, tankers and terminals have caused widespread fuel shortages. “Wherever they attempt to strike Russian territory, we will respond in kind, but our strikes will be several times more powerful,” Putin told pro-Kremlin activists. A fifth of the world’s oil and gas passed through the strait without paying any fees before Iran asserted control over it after the start of the war. Iran says it has the right to manage traffic through the strait and potentially charge fees in accordance with an interim peace deal reached last month. The U.S. and others dispute that, citing international law on freedom of navigation, and the American military has tried to establish an alternative route outside of Iranian control. The European Union’s top diplomat, Kaja Kallas, called for the strait to be open, as it was before the war. “Freedom of navigation has to be respected,” she said. Trump says he’s recommended that Lindsey Graham’s sister be named as his temporary replacement in the U.S. Senate. Trump posted on social media Monday that Gov. Henry McMaster should appoint Darline Graham Nordone to fulfill the rest of Graham’s term, which expires in January. Graham died over the weekend at age 71, and McMaster is expected to announce his pick later Monday afternoon. After their parents died at a young age, Graham was left to raise his sister, whom he later adopted. The pair were very close, and Graham’s sister was by his side as he filed reelection paperwork earlier this year. Following the downfall of Graham Platner in Maine, progressives view the Upper Midwest Senate races as their last chance to shape the Democrats’ Senate caucus and prove their theory of the case in the midterm elections. In Michigan, Rep. Haley Stevens is running against progressive Abdul El-Sayed for the state’s Democratic Senate nomination in a race Democrats must win to hold the seat held by Sen. Gary Peters, who is retiring and has endorsed Stevens. In Wisconsin, democratic socialist state Rep. Francesca Hong has surged in the state’s Democratic gubernatorial primary against more conventional Democratic lawmakers, including former Lt. Gov. Mandela Barnes and current Lt. Gov. Sara Rodriguez. Michigan voters choose nominees on Aug. 4. The primaries in Minnesota and Wisconsin are Aug. 11. In Minnesota, the two leading Senate candidates have clashed over electability, their ties to corporate interests and willingness to fight Trump’s administration. Lt. Gov. Peggy Flanagan, backed by progressive Sens. Bernie Sanders of Vermont and Elizabeth Warren of Massachusetts, says her opponent, Rep. Angie Craig, is backed by “secretive dark money groups.” “The very folks who are standing in the way of the things that people need to be able to afford their lives, who are Democrats, are funded by these corporate special interests,” Flanagan told The Associated Press. Craig counters that Flanagan has raised campaign funds from major companies, and that if she becomes the Democratic nominee, Republicans would focus on her ties to an ongoing fraud inquiry into the state’s Medicaid programs. “To stop Donald Trump, we’ve got to win elections,” Craig told the AP. Progressives hope to prove economic populism resonates beyond deep blue enclaves. Democratic Party leaders worry progressive candidates could damage their brand and imperil their chances of retaking either chamber of Congress. August primaries in Michigan, Wisconsin and Minnesota will be another gauge of Democratic voters’ frustration with the establishment. The Upper Midwest is a battleground for progressives and moderates. The outcomes could impact Democrats’ chances in the upcoming midterms and shape their party’s future direction. South Carolina law requires a one-week filing period beginning July 21, for a special primary to be held on Aug. 11. A runoff if necessary would be held on Aug. 25, leaving the nominee just over two months to campaign for the general election on Nov. 3. All of this is problematic according to federal law, which requires military and overseas ballots to go out 45 days before any federal election. For the general election primary, that would have been June 27. Federal Election Commission officials didn’t immediately return a message seeking clarity.
Iran: Living in limbo between war and ceasefire
Iran: Living in limbo between war and ceasefireJuly 13, 2026 Since the ceasefire between Iran, the United States and Israel was announced, Iranians have repeatedly been told that the war is over. But at the same time, attacks, threats and diplomatic talks have continued. Iranian authorities talk about negotiations, progress and even sanctions relief one day, only to warn of retaliation, further strikes and threats to Iran's critical infrastructure the next. This constant oscillation between war and diplomacy has left many people in Iran caught between hope and dread. For many, that uncertainty has become more psychologically damaging than the war itself. The problem is no longer just the fear of violence, but also the inability to imagine a stable future. A society unable to plan One lawyer based in Tehran, who asked not to be named, told DW that the hardest part of the current moment is not knowing when the crisis will end. "The most important feature of this moment is that the end of the war is unknown," she said. "When you cannot plan how to endure hardship, it puts enormous pressure on you." She said she no longer has the motivation to work or start anything new. Even speaking freely in society feels difficult. In the city where she grew up in, she said, she now feels a sense of estrangement from some of the people around her. That sense of paralysis appears to go well beyond individual frustration, affecting basic decisions about work, family and the future. Combined with economic instability and the constant fear that violence could return at any moment, the result has been a wider mood of fatigue and social stagnation. "We are completely hopeless," a resident of Isfahan city told DW. "This instability between peace and war has turned our mental state into a game, and we have no clear outlook for our future, or for our psychological and financial security." The same person said the entire experience had become deeply corrosive, with trust in either side of the war, or in the possibility of a durable agreement, having largely collapsed. Generation without a template for war The current uncertainty may weigh especially heavily on younger Iranians, many of whom have no direct memory of the 1980-88 Iran-Iraq war or of life under prolonged military threat. For them, this is the first experience of living under the shadow of an open-ended regional conflict. A nurse in western Iran told DW that when a society enters this kind of situation, trust in the future weakens and people begin postponing long-term decisions. "People start living as if the only goal is just to get through today," she said on condition of anonymity. For a generation without direct experience of prolonged war, she added, the situation is more disorienting, not necessarily because they are weaker, but because they have no mental model for how to live through such a period. What many people are experiencing now is less fear of war in the narrow sense than exhaustion produced by uncertainty, she said. The nurse said the change is visible in hospitals and clinics, with patients being increasingly angry, dissatisfied and easily provoked. Even when services are good, she said, many remain upset. In her view, that anger is inseparable from the wider social climate. Anger, despair and emotional burnout Saeed Paivandi, a professor at the University of Lorraine in France, told DW that available data and field research point to two overlapping tendencies in Iran today: widespread despair about the future, and intense anger at the government's inability to deal with ordinary life and govern effectively. Referring to a survey conducted by Iran's Interior Ministry in May 2026, he said it found that around 60% of the population felt hopeless about the future. He also cited more recent survey findings published by IranWire, which he said showed anger in 64% of respondents, despair in around 50%, depression in 48% and fear and anxiety in about 45%. According to Paivandi, these figures show a clear deterioration compared with the last available survey before the mass anti-government protests and the authorities' harsh clampdown earlier this year. He believes anger, depression and anxiety have all risen by roughly 10 to 12 percentage points. That suggests that the state crackdown, followed by the US and Israeli attack on Iran, has left a serious mark on how people feel about life, politics and the future. Paivandi also said the data point to another striking trend: around one-third of Iranians now express a desire to emigrate, with that figure rising among younger and more educated groups. Outside deal unlikely to resolve an inside crisis Against this backdrop, experts argue that Iran's current psychological crisis extends beyond ceasefires, diplomacy and military escalation. While the external conflict matters, it has landed on top of a society already worn down by high inflation, repression, mistrust and a long-running sense of blocked opportunity. What makes the current moment especially difficult is that no side has offered people a clear and credible horizon. Instead, they are confronted with contradictory messages every day, making uncertainty a fact of daily life. And the longer that limbo continues, the more difficult it becomes to restore confidence — or sustain people's energy needed to imagine any future at all. Edited by: Srinivas Mazumdaru
Iran: Life in limbo between war and ceasefire
Iran: Life in limbo between war and ceasefireJuly 13, 2026 Since the ceasefire between Iran, the United States and Israel was announced, Iranians have repeatedly been told that the war is over. Yet, attacks, threats and diplomatic talks have continued simultaneously, with Iranian authorities speaking of negotiations, progress and even sanctions relief one day, only to warn of retaliation, further strikes and threats to Iran's critical infrastructure the next. This constant oscillation between war and diplomacy has left many people inside Iran caught between hope and dread. For many, that uncertainty has become more psychologically damaging than the war itself. The problem is no longer just the fear of violence, but also the inability to imagine a stable future. A society unable to plan One lawyer based in Tehran, who asked not to be named, told DW that the hardest part of the current moment is not knowing when the crisis will end. "The most important feature of this moment is that the end of the war is unknown," she said. "When you cannot plan how to endure hardship, it puts enormous pressure on you." She said she no longer has the motivation to work or start anything new. Even speaking freely in society feels difficult. In the city where she grew up in, she said, she now feels a sense of estrangement from some of the people around her. That sense of paralysis appears to go well beyond individual frustration, affecting basic decisions about work, family and the future. Combined with economic instability and the constant fear that violence could return at any moment, the result has been a wider mood of fatigue and social stagnation. "We are completely hopeless," a resident of Isfahan city told DW. "This instability between peace and war has turned our mental state into a game, and we have no clear outlook for our future, or for our psychological and financial security." The same person said the entire experience had become deeply corrosive, with trust in either side of the war, or in the possibility of a durable agreement, having largely collapsed. Generation without a template for war The current uncertainty may weigh especially heavily on younger Iranians, many of whom have no direct memory of the 1980-88 Iran-Iraq war or of life under prolonged military threat. For them, this is the first experience of living under the shadow of an open-ended regional conflict. A nurse in western Iran told DW that when a society enters this kind of situation, trust in the future weakens and people begin postponing long-term decisions. "People start living as if the only goal is just to get through today," she said on condition of anonymity. For a generation without direct experience of prolonged war, she added, the situation is more disorienting, not necessarily because they are weaker, but because they have no mental model for how to live through such a period. What many people are experiencing now is less fear of war in the narrow sense than exhaustion produced by uncertainty, she said. The nurse said the change is visible in hospitals and clinics, with patients being increasingly angry, dissatisfied and easily provoked. Even when services are good, she said, many remain upset. In her view, that anger is inseparable from the wider social climate. Anger, despair and emotional burnout Saeed Paivandi, a professor at the University of Lorraine in France, told DW that available data and field research point to two overlapping tendencies in Iran today: widespread despair about the future, and intense anger at the government's inability to deal with ordinary life and govern effectively. Referring to a survey conducted by Iran's Interior Ministry in May 2026, he said it found that around 60% of the population felt hopeless about the future. He also cited more recent survey findings published by IranWire, which he said showed anger in 64% of respondents, despair in around 50%, depression in 48% and fear and anxiety in about 45%. According to Paivandi, these figures show a clear deterioration compared with the last available survey before the mass anti-government protests and the authorities' harsh clampdown earlier this year. He believes anger, depression and anxiety have all risen by roughly 10 to 12 percentage points. That suggests that the state crackdown, followed by the US and Israeli attack on Iran, has left a serious mark on how people feel about life, politics and the future. Paivandi also said the data point to another striking trend: around one-third of Iranians now express a desire to emigrate, with that figure rising among younger and more educated groups. Outside deal unlikely to resolve an inside crisis Against this backdrop, experts argue that Iran's current psychological crisis extends beyond ceasefires, diplomacy and military escalation. While the external conflict matters, it has landed on top of a society already worn down by high inflation, repression, mistrust and a long-running sense of blocked opportunity. What makes the current moment especially difficult is that no side has offered people a clear and credible horizon. Instead, they are confronted with contradictory messages every day, making uncertainty a fact of daily life. And the longer that limbo continues, the more difficult it becomes not only to restore confidence, but also to sustain the societal energy needed to imagine a future at all. Edited by: Srinivas Mazumdaru
Iran: Living in limbo between war and ceasefire
Iran: Living in limbo between war and ceasefireJuly 13, 2026 Since the ceasefire between Iran, the United States and Israel was announced, Iranians have repeatedly been told that the war is over. But at the same time, attacks, threats and diplomatic talks have continued. Iranian authorities talk about negotiations, progress and even sanctions relief one day, only to warn of retaliation, further strikes and threats to Iran's critical infrastructure the next. This constant oscillation between war and diplomacy has left many people in Iran caught between hope and dread. For many, that uncertainty has become more psychologically damaging than the war itself. The problem is no longer just the fear of violence, but also the inability to imagine a stable future. A society unable to plan One lawyer based in Tehran, who asked not to be named, told DW that the hardest part of the current moment is not knowing when the crisis will end. "The most important feature of this moment is that the end of the war is unknown," she said. "When you cannot plan how to endure hardship, it puts enormous pressure on you." She said she no longer has the motivation to work or start anything new. Even speaking freely in society feels difficult. In the city where she grew up in, she said, she now feels a sense of estrangement from some of the people around her. That sense of paralysis appears to go well beyond individual frustration, affecting basic decisions about work, family and the future. Combined with economic instability and the constant fear that violence could return at any moment, the result has been a wider mood of fatigue and social stagnation. "We are completely hopeless," a resident of Isfahan city told DW. "This instability between peace and war has turned our mental state into a game, and we have no clear outlook for our future, or for our psychological and financial security." The same person said the entire experience had become deeply corrosive, with trust in either side of the war, or in the possibility of a durable agreement, having largely collapsed. Generation without a template for war The current uncertainty may weigh especially heavily on younger Iranians, many of whom have no direct memory of the 1980-88 Iran-Iraq war or of life under prolonged military threat. For them, this is the first experience of living under the shadow of an open-ended regional conflict. A nurse in western Iran told DW that when a society enters this kind of situation, trust in the future weakens and people begin postponing long-term decisions. "People start living as if the only goal is just to get through today," she said on condition of anonymity. For a generation without direct experience of prolonged war, she added, the situation is more disorienting, not necessarily because they are weaker, but because they have no mental model for how to live through such a period. What many people are experiencing now is less fear of war in the narrow sense than exhaustion produced by uncertainty, she said. The nurse said the change is visible in hospitals and clinics, with patients being increasingly angry, dissatisfied and easily provoked. Even when services are good, she said, many remain upset. In her view, that anger is inseparable from the wider social climate. Anger, despair and emotional burnout Saeed Paivandi, a professor at the University of Lorraine in France, told DW that available data and field research point to two overlapping tendencies in Iran today: widespread despair about the future, and intense anger at the government's inability to deal with ordinary life and govern effectively. Referring to a survey conducted by Iran's Interior Ministry in May 2026, he said it found that around 60% of the population felt hopeless about the future. He also cited more recent survey findings published by IranWire, which he said showed anger in 64% of respondents, despair in around 50%, depression in 48% and fear and anxiety in about 45%. According to Paivandi, these figures show a clear deterioration compared with the last available survey before the mass anti-government protests and the authorities' harsh clampdown earlier this year. He believes anger, depression and anxiety have all risen by roughly 10 to 12 percentage points. That suggests that the state crackdown, followed by the US and Israeli attack on Iran, has left a serious mark on how people feel about life, politics and the future. Paivandi also said the data point to another striking trend: around one-third of Iranians now express a desire to emigrate, with that figure rising among younger and more educated groups. Outside deal unlikely to resolve an inside crisis Against this backdrop, experts argue that Iran's current psychological crisis extends beyond ceasefires, diplomacy and military escalation. While the external conflict matters, it has landed on top of a society already worn down by high inflation, repression, mistrust and a long-running sense of blocked opportunity. What makes the current moment especially difficult is that no side has offered people a clear and credible horizon. Instead, they are confronted with contradictory messages every day, making uncertainty a fact of daily life. And the longer that limbo continues, the more difficult it becomes not only to restore confidence, but also to sustain the societal energy needed to imagine a future at all. Edited by: Srinivas Mazumdaru
Headlines for July 13, 2026
The United States is continuing to bombard Iran amid an intensifying standoff over the Strait of Hormuz. On Sunday, U.S. Central Command said the U.S. had struck 140 targets in Iran. In retaliation, Iran’s Revolutionary Guards said they had targeted U.S. military facilities in Bahrain, Qatar, Kuwait, Oman and Jordan. The escalating attacks come after Iran announced the closure of the Strait of Hormuz and President Trump declared the ceasefire was over. On Sunday, U.N. Secretary-General António Guterres said he was “deeply concerned by the serious escalation.” He urged Iran and the United States to “urgently resume negotiations and to address outstanding issues through diplomacy.” We will have more on Iran after headlines. In the occupied West Bank, armed Israeli settlers have carried out a number of attacks in recent days targeting local Palestinians, as well as foreign journalists and even a U.S. congressmember. On Wednesday, armed settlers carrying U.S.-made M4 rifles surrounded a van carrying Democratic Congressman Ro Khanna, who was visiting a Palestinian village that had been destroyed by settlers. Khanna said his delegation was blocked for about 90 minutes. Rep. Ro Khanna: “I am certainly, probably, the first American politician who’s been detained by the IDF and Israeli settlers. I mean, we were at a village that Israeli settlers had destroyed. They had destroyed the school. They had destroyed that village. And we were just looking at it, and these hoodlums come in with machine guns, an M4, an American-made machine gun, and they detain us. They block off the road. And then they call the IDF, and the IDF is on their side, not on the side of the Americans.” In a separate incident, on Saturday, Israeli settlers armed with clubs, rocks and a knife attacked a group of journalists including CNN’s Jeremy Diamond. One of the journalists posted video of the attack on Instagram. Adele Shoko: “He’s going at our car.” Jasper Nathaniel: “Go. Drive. Drive.” Adele Shoko: “No! No! No!” Jasper Nathaniel: “Drive. Move! Move!” Gabriele Micalizzi: “Move.” Jasper Nathaniel: “Get the [bleep] out of the way! Move! Move! Move!” Gabriele Micalizzi: “Move. Move.” Andrey X: “Drive. Drive. Drive. Drive. Drive.” Jasper Nathaniel: “Move!” Andrey X: “Go. Go. Go.” Jasper Nathaniel: “Watch out! Watch out!” Israel reportedly arrested four individuals in the attack on the journalists. The incident occurred at the same location where a mob of settlers beat U.S. citizen, 20-year-old Saif Musallet to death exactly one year earlier. To date, no one has been arrested for the death of Musallet. Republican Senator Lindsey Graham of South Carolina has died at the age of 71 after what his office called a “brief and sudden illness.” For decades, Graham had been one of the most vocal supporters of war in Washington. Graham died just after returning from a visit to Ukraine, where he met with Ukrainian President Volodymyr Zelensky. During the trip, Graham pushed for increased U.S. military support for Ukraine. Sen. Lindsey Graham: “We have a magic moment in time here. In the coming months, if we do this right, increase Ukraine’s lethality, get people to help us with Putin, rather than propping him up, we can end this war.” Lindsey Graham was a leading backer of the U.S. and Israeli war on Iran, as well as a vocal supporter of the 2003 U.S. invasion of Iraq. He also pushed for a permanent occupation of Afghanistan and once called for a preemptive attack on North Korea. After Israel was accused of committing genocide in Gaza, Graham told the head of the International Criminal Court, “this court is for Africa and thugs like Putin. It is not for democracies like Israel and the United States.” Graham became a close ally of President Trump, but during his unsuccessful, failed presidential run in 2016, Graham had this to say about Trump. Sen. Lindsey Graham: “He’s a race-baiting, xenophobic, religious bigot. He doesn’t represent my party. He doesn’t represent the values that the men and women who wear the uniform are fighting for. … And you know how you make America great again? Tell Donald Trump to go to hell.” South Carolina’s Republican governor will now pick a replacement to serve out the rest of Senator Graham’s term, which ends in January. Republicans will hold a special primary in August to pick a candidate to run in November. In other news from the Senate, Kentucky Republican Mitch McConnell has finally revealed details about why he has been hospitalized for the past month. In a statement, the 84-year-old McConnell said that he fell on June 14 and became “briefly unconscious.” He later developed what he described as a mild case of pneumonia. McConnell also released a photograph from his hospital bed with his wife Elaine Chao. McConnell is planning to retire at the end of his current term in January. With McConnell’s absence and the death of Lindsey Graham, the Republicans have just 51 votes in the Senate for now. The Justice Department has subpoenaed four journalists at The New York Times after they reported President Trump’s new Air Force One lacked key security features, including advanced anti-missile capabilities. The Boeing aircraft had been donated to Trump by Qatar and then refurbished. Trump flew on the plane last week to the NATO summit in Turkey but then took the old Air Force One home due to security concerns. The Times reported subpoenas were issued to the reporters Julian Barnes, Eric Lipton, Tyler Pager and Eric Schmitt. The subpoenas were issued by Jay Clayton, the U.S. attorney in Manhattan, who was recently nominated by Trump to serve as director of national intelligence. Clayton’s confirmation hearing is set for Wednesday. A lawyer for The New York Times said, “This brazen act should be seen as nothing more than an attempt to prevent the public from knowing what is happening in their country by intimidating journalists from doing their jobs.” The head of the Committee to Protect Journalists, Jodie Ginsberg, said, “The subpoenas are an extraordinary escalation in President Trump’s efforts to threaten and intimidate independent news organizations, and have a chilling effect on the work of journalists across the country.” The New York Times has revealed U.S. Secretary of State Marco Rubio has become the de facto viceroy of Venezuela, effectively controlling Venezuela’s finances, the distribution of its natural resources and its government. Rubio’s informal role began after U.S. forces attacked Venezuela in January and abducted Venezuelan President Nicolás Maduro and his wife Cilia Flores. Maduro’s former vice president, Delcy Rodríguez, has since served as Venezuela’s acting president, but the Times reports Rubio has essentially been running the country from afar, even controlling Rodríguez’s public appearances and statements, as well as her governmental appointments. The Times likened Rubio’s role to that of Paul Bremer, who was installed by George W. Bush to run Iraq after the 2003 U.S. invasion. In Europe, a group of scientists warned that extreme heat led to 10,000 excess deaths in the last month. Germany recorded nearly 100 deaths by drowning. Over the weekend, wildfires raged in Spain, killing at least 12 people, in one of the deadliest wildfires in the country’s history. In Greece, authorities have urged residents in the country’s second-largest city, Thessaloniki, to stay indoors and secure their windows and doors because of toxic smoke caused by a recycling plant engulfed by a wildfire. Meanwhile, in France, hundreds of firefighters are battling a wildfire south of Paris. A Trump-appointed federal judge has approved a request by the Justice Department to dismiss seditious conspiracy charges against five members of the far-right group the Proud Boys in connection with the January 6 insurrection. In his order, Judge Timothy Kelly said he did not agree with President Trump granting clemency to the rioters, but that he had no choice but to comply. After taking office, President Trump pardoned all of the nearly 1,600 rioters for taking part in the attack on the Capitol, which injured more than 100 police officers. Protests are continuing in Houston, Texas, after an ICE agent fatally shot Lorenzo Salgado Araujo, a 52-year-old Mexican father who had lived in the United States for decades. He was shot after being stopped while driving to a construction site with three other men who were detained. Houston Police Chief Noe Diaz is expected to meet with the FBI on Tuesday in an attempt to access evidence gathered by federal investigators. On Friday, the family of Lorenzo Salgado Araujo and lawmakers gathered to call for an independent investigation after eyewitnesses disputed claims made by ICE agents. Hugo Baldera-Ybarra is a lawyer for the family. Hugo Baldera-Ybarra: “After speaking with these men, I have no doubt that what they’re saying is the truth. I know that these agents — the agency is going to try to cover it up. This is not the first time that it happens. This has become a pattern, where ICE agents claim that they use their vehicle as a deadly weapon, that they tried to run over the agents and the agents shot in self-defense. But all three of my clients reiterated that at no point was there ever an agent standing in front of the vehicle, nor was an agent ever placed in the line of danger. That is simply false, and I believe my clients are telling the truth.” The Justice Department is investigating Yale’s admissions practices for its medical school, law school and undergraduate college. Now Yale Law School’s dean, Cristina Rodríguez, and several other law school faculty members are urging Yale’s leadership not to settle with the Trump administration, saying that it would be damaging to the rule of law and would compromise the university’s reputation. According to the Yale Daily News, the university’s first settlement offer was rejected by the Trump administration; Yale has since offered a second proposal. Democratic Senator Richard Blumenthal of Connecticut said, “As I’ve told top Yale officials, Trump’s word means nothing. An agreement with these corrupt bullies is only an invitation to more lawbreaking abuse.” In election news, a federal judge in Atlanta has rejected the Justice Department’s subpoena seeking the names of election workers in Fulton County, Georgia, from the 2020 election. Judge William Ray wrote in his order, “Such a large disclosure of information threatens to chill participation in future elections, which will surely impact Fulton County.” President Trump continues to repeat the false claim that he won the state of Georgia in the 2020 election, accusing Fulton County officials of so-called ballot fraud. It comes as President Trump is pushing Congress to pass the SAVE America Act, which would require proof of citizenship to register to vote and identification at the polls. Meanwhile, in Texas, the state’s Attorney General Ken Paxton has reportedly listed an address where he did not reside, while voting in several elections during the last two years. This comes as Paxton has warned voters about misrepresenting their residence on election records. The president of PEN America, the novelist Dinaw Mengestu, has resigned from his position in part because of an article published by the organization about Israeli and Jewish writers denouncing cultural boycotts. Mengestu said in an interview with The New York Times that he didn’t agree with the publication of the article because it could cast the Boycott, Divestment and Sanctions (BDS) movement as discrimination instead of protected political speech. Mengestu said, “We have the responsibility to be conscious and aware of how our work can impact and influence those debates, and especially if that means producing work that might actually restrict or limit or suppress what is constitutionally protected speech.” In an email to the Times, PEN America said, ”PEN America has long opposed cultural and academic boycotts, but we have always drawn a clear line between disagreeing with a tactic and defending the right to use it.” Civil rights leaders are backing an independent investigation into the mysterious death of Nolan Xavier Wells, an 18-year-old Black college athlete whose body was found last week on a barrier island in Mississippi. Wells had taken a boat to the island with a group of white friends to celebrate the July Fourth holiday. The friends say Wells chose to stay on the island when they returned home. Authorities say Wells may have accidentally drowned, but his family has questioned the official story in part because Wells’s cellphone was found not with his body, but in the possession of one of his friends who returned home. Wells’s mother spoke at a press conference on Friday. Christine Wonsley: “Nolan was — is the kindest soul. He never met a stranger. He loved everybody. He didn’t care if you were Black, white, purple, green, looked like a marshmallow. Like, he just wanted everyone to be in peace with one another. He just — he loved life, and God gave him this big heart, which always scared us. Me and his dad had conversations with him all the time, not just about the importance of understanding our history as Black people, but also the importance of how you have to move in certain spaces.” The family of Nolan Wells is being represented by civil rights attorney Ben Crump, who also spoke at Friday’s press conference. Benjamin Crump: “It is because the family has distrust of the Mississippi law enforcement officials giving them a fair investigation where their Black son ended up dead after going out on a boat with three young white men. The history of Mississippi is something that they don’t just read about in books, but it’s a lived experience for many Black Americans.”
US and Iran trade Hormuz control claims as attacks roil Middle East
US and Iran trade Hormuz control claims as attacks roil Middle East US forces struck targets in Iran as Tehran asserted control over the Strait of Hormuz. The rival claims over the waterway threaten ceasefire efforts and wider regional security. The United States and Iran on Monday both asserted control over the Strait of Hormuz after a weekend of attacks across the wider Middle East, further straining efforts to revive diplomacy and end the war. The confrontation has sharpened focus on the strategic waterway, which remains central to negotiations and regional security. The latest round of attacks began after Iran struck a container ship on Sunday in the strait off the coast of Oman. The exchanges have raised concerns that the war could return to full-scale fighting despite an interim 60-day deal meant to prepare the ground for talks on a permanent end to the conflict. “A return to full-scale hostilities would have catastrophic consequences,” United Nations Secretary-General António Guterres said in a statement. The US military’s Central Command said its forces struck dozens of targets in Iran on Monday, including air defence systems, radar sites, missile and drone equipment, and small boats. “The Strait of Hormuz is a vital maritime corridor for global trade,” Central Command said. “Iran does not control it.” European Union foreign policy chief Kaja Kallas also called for the strait to remain open. “The Strait of Hormuz has to be opened, freedom of navigation has to be respected,” she said. Iran’s paramilitary Revolutionary Guard rejected the US position. “The Strait of Hormuz is our territory, and we will not allow a rogue and child-killing army from the other side of the world to continue its illegal interference in it,” the Guard said. Missile alert sirens sounded three times in Bahrain, which hosts the US Navy’s 5th Fleet, while Kuwait said it was intercepting hostile fire. There was no immediate word on damage in either country. Jordan’s military said it shot down four Iranian missiles in an incident that “resulted in zero casualties or material damage”. Inside Iran, authorities reported attacks in Hormozgan, Khuzestan and Markazi provinces, and state-run IRNA said at least two people were killed. Semi-official Iranian media also reported strikes in Sistan and Baluchestan province. Iranian attacks on Sunday had also stretched Bahrain, Kuwait, Qatar, Jordan and Oman, whose territorial waters with Iran make up the strait. Oman later summoned an Iranian diplomat to criticise the attack. Separately, a base belonging to the armed wing of the Kurdistan Freedom Party, an Iranian Kurdish opposition group based in Iraq’s semi-autonomous Kurdistan region, came under drone attack on Monday. Rebaz Sharifi, commander of the Kurdistan Militia Corps, said the strikes targeted the group’s Chamshar base, without giving details about casualties or damage. No group immediately claimed responsibility. The US military said early Sunday that it had hit about 140 targets, including missile and drone launch sites, ammunition dumps, communication equipment and other locations, marking a heavier set of strikes than in the previous two rounds over the past week. US President Donald Trump said on NBC’s “Meet the Press”: “We bombed the hell out of them last night.” Iran then retaliated by attacking countries in the region that host US military forces, while insisting that it alone must control the strait and could potentially charge vessels for passing through it. Iran said the strait was closed, while the US military and Trump said it remained open. Iran’s hold over the waterway has eased to some extent as the US military backed ships travelling along a southern route close to Oman’s coastline, though Iran has repeatedly attacked vessels using that route. Iran’s grip on the strait had triggered a global energy crisis, although oil prices have fallen sharply from wartime highs of USD 120 a barrel. Iranian Foreign Ministry spokesperson Esmail Baghaei blamed Washington for the turmoil. “Considering the memorandum of understanding’s fourteen clauses, the Americans have, in this brief period, in one way or another, slaughtered its various components,” Baghaei told journalists on Monday. He also said Iran would not agree to visits by the International Atomic Energy Agency to Iranian nuclear sites bombed by the US in 2025, where Tehran’s stockpile of highly enriched uranium is believed to remain. Diplomatic efforts continued alongside the fighting. Trump said last week that the interim deal in the war was “over”, but mediators including Pakistan, Qatar and Egypt have kept trying to secure a final agreement. A regional official involved in mediation, speaking on condition of anonymity, said efforts to shore up the ceasefire continued on Sunday. Pakistan said its foreign minister spoke by phone with Iran’s top diplomat and urged “de-escalation” on both sides. Iran’s new supreme leader, Ayatollah Mojtaba Khamenei, who had not been seen since the war began, said on Saturday in his first statement since the funeral of his father, Ayatollah Ali Khamenei, that Iranians would avenge his killing. The latest attacks have left the Strait of Hormuz at the centre of the conflict, with both Washington and Tehran staking rival claims over the waterway even as mediators continue attempts to prevent the war from escalating further. With PTI Inputs
Washington, Tehran Both Claim Control of Hormuz Strait as Jerusalem Mourns Loss of 'True Friend' Graham
Washington, Tehran Both Claim Control of Hormuz Strait as Jerusalem Mourns Loss of 'True Friend' Graham JERUSALEM, Israel – Trouble between the U.S. and Iran is escalating with conflicting reports about the Strait of Hormuz, as Israel mourns the loss of Senator Lindsey Graham, one of its closest American friends and allies. Both Washington and Tehran claim that they control the Strait of Hormuz following strikes on Monday against Iranian targets in retaliation for Iran's drone and missile attacks against Jordan, Kuwait, Oman and Qatar. So far, Iran has not targeted Israel. The Iranian Revolutionary Guard Corps (IRGC) released a statement blaming their most recent strike on a ship in the Strait, alleging that the vessel traveled "along an unauthorized route." Earlier, U.S. CENTCOM announced it had struck 140 military targets after Iran "blatantly" attacked a Cyprus-flagged container ship. Israeli Prime Minister Benjamin Netanyahu spoke at a ceremony on Sunday marking 50 years since his brother, Yoni, was killed leading a dramatic operation to rescue more than 100 hostages at Entebbe Airport in Uganda. The prime minister said Israel had averted an existential threat in the fight against Iran. He declared, “We are systematically crushing the Iranian axis of evil and terror, which sought to advance the plan to destroy Israel by means of a noose of terror it had tightened around us.” Israeli Ambassador to the U.S. Yechiel Leiter told CBS Face the Nation a few weeks ago that Iran had to do only one thing: keep the Strait of Hormuz open; they ignored it, forcing the U.S. to return to fighting. Concerning Israel's role, he stated, “We’re a partner. We’re an ally. If the United States calls on us to rejoin kinetic activity against Iran, we’re going to be there for the United States." *** AI tools threaten to hide CBN News from your online searches! Sign up for CBN Newsletters today to ensure you can still find the latest news from a Christian perspective.*** Israelis, meanwhile, were shocked and heartbroken at the sudden death of Lindsey Graham over the weekend. President Isaac Herzog hailed him as a "true friend of Israel" and personally, "a dear friend." Herzog noted, “Senator Graham was a beacon of moral clarity who brought an exceptional sense of justice, truth, and loyalty to his decades of public service. He was a maverick in world affairs, and one of Israel's greatest friends and allies in the United States of America." The president added, "He maintained his steadfast and unwavering support for the people of Israel, especially at our most difficult and painful moments. Lindsey understood the profound importance of the U.S.-Israel partnership and tirelessly advocated for our shared values and shared interests.”
Renewed US-Iran war is hitting Gulf countries hard
Renewed US-Iran war is hitting Gulf countries hardJuly 13, 2026 Yet again, countries in the Gulf region find themselves on the front line between the United States and Iran. The war began in late February when the US and Israel attacked Iran. A memorandum of understanding intended to stop the fighting was signed by the US and Iran in June. Since then, however, both countries have accused the other of not adhering to the agreement, and fighting has started again. The US has bombed Iran, and Iran has retaliated by striking US allies in the Middle East — that is, mostly Gulf nations. Even if they are not hit directly, all countries in the Gulf region have something to lose should fighting escalate again. Bahrain Bahrain is home to a major US Navy base. The recent strikes by Iran saw the country hit directly. As Bahrain is among the smaller Gulf countries, US military installations tend to be closer to residential and commercial areas than in its neighbors. Even limited fighting disrupts civilian life. Politically, Bahrain is in a particularly difficult position. Like other Gulf countries, Bahrain is a monarchy and represses most political dissent. But, in contrast to other Gulf countries, Bahrain's royal family are Sunni. Estimates suggest that the majority of the population is Shiite. Iran is a Shiite theocracy. Ongoing fighting between Iran and the United States could create tensions within Bahrain, where the government has arrested hundreds of people who allegedly posted anti-war messages online, expressed "sympathy" with Iran or participated in demonstrations, or who the government claims were "spies" working for Iran. Kuwait Kuwait hosts the largest number of US bases in the Middle East. This includes two air bases and about 13,500 personnel, including contractors. This has made Kuwait a target for Iranian strikes. Previously, Kuwait was more cautious with its foreign policy, often positioning itself as a mediator and emphasizing that it did not want to play a role in the current conflict. Iraq's 1990 invasion was a factor in shaping Kuwait's foreign policy, which is far less activist than those of its neighbors. However, the fact that Iran has attacked Kuwait because of its US bases is likely to cause this attitude to evolve. Observers have already noted that the Kuwait government's protests about Iranian strikes have become more forthright. Saudi Arabia Saudi Arabia is home to a major US air force base. After years of competing with Iran for regional influence, Saudi Arabia has stressed that diplomacy must be the answer if Gulf countries are to coexist in relative peace. And Saudi Arabia would much rather focus on its economic goals for its Vision 2030 plan than get involved in a war it says it never wanted. Saudi Arabia's priority is preventing the conflict from spreading and protecting its own critical oil infrastructure, experts say. Iran's blocking of the Strait of Hormuz has seen Saudi Arabia divert some of its all-important oil exports — the country's main revenue source — to another pipeline that connects to the Red Sea. In general, Saudi officials have tried to maintain a careful balance in the current conflict. They have spoken directly with the Iranians and the Americans. At one stage, Saudi Arabia denied the United States the use of its airspace to bomb Iran, but later reports suggested that the Saudis also carried out their own unpublicized strikes on Iran. United Arab Emirates The United Arab Emirates also hosts an important US air base. Still, renewed fighting in the Middle East risks further damaging the reputation of places such as Abu Dhabi and Dubai as financial and commercial hubs, a reputation that has been essential to an Emirati economic future that is not as dependent on oil exports. The United Arab Emirates has also been able to divert some of its oil exports from the Strait of Hormuz via an inland pipeline, but prolonged conflict could disrupt that. Qatar Qatar is home to Al Udeid air base, the largest US military installation in the Middle East. At the same time, Qatar has comparatively good relations with Iran, with whom it shares a large natural gas field. Iran's earlier attack on a Qatari ship at sea was one of the incidents that started the latest round of bombing. Some analysts describe Qatari diplomats as the best in the world. They have regularly acted as mediators during the US-Iran war, including in formulating the memorandum of understanding that first stopped fighting in June. Oman Oman, which does not host a major US military installation, has maintained good relations with both the United States and Iran and has served as a facilitator for backchannel diplomacy between the governments. As with Qatar, the options that Oman can offer for further talks among the parties to this conflict may well be useful in the near future. This article was originally published on July 8 and updated on July 13 to reflect new strikes on Iran and US bases in the region.