WS #12460

The US-Iran conflict continues to escalate, with the US launching a ninth consecutive night of airstrikes and Iran retaliating, including an IRGC claim of a strike on US aircraft at Aqaba Airport. Oil prices have surged past $90/barrel, with Brent reclaiming that level, and US gas prices hitting $4/gallon. The Strait of Hormuz standoff persists, with oil tankers reportedly exploding. This escalation counters any prior de-escalation narrative and is likely to drive energy stocks higher while pressuring airlines and consumer stocks. Separately, Ukraine struck Russian oil infrastructure, including an oil depot in the Moscow region and three shadow fleet tankers in the Black Sea, adding to supply concerns. Ryanair reported a 34% profit drop due to soaring jet fuel costs and consumer hesitancy, missing earnings estimates. On the positive side, Boeing received a commitment from Riyadh Air for 28 787 Dreamliners, and FAA officials indicated certification of the 737 MAX 7 and 10 is expected soon. China's car market is heading for its worst year since 2021, with sales plunging 20%, which is bearish for global auto and commodity demand. The DeepSeek quant fund reportedly lost 16% amid a China market rout. Japan introduced a crypto clarity act, recognizing crypto as a financial asset and proposing tax cuts, which is bullish for crypto markets. Iran signaled openness to talks with the US, and the Kremlin welcomed new contacts with the US, suggesting potential diplomatic off-ramps. The dominant theme is ESCALATING US-Iran conflict with oil price implications, while diplomatic signals provide a potential counter.