WS #12533

The US-Iran conflict continues to escalate with a significant new development: Iran's IRGC claims to have struck and destroyed Amazon Web Services (AWS) data infrastructure in Bahrain with cruise missiles, as retaliation for US strikes on Iran's Darkhovin nuclear plant. This marks a major escalation targeting civilian tech infrastructure and could directly impact Amazon's cloud operations in the region. Separately, reports indicate Iran has received mediation proposals including a potential 10-day ceasefire, which could de-escalate tensions. Oil prices are easing slightly (WTI down 1% to ~$81.65, Brent below $89) on the mediation hopes, but the Strait of Hormuz remains effectively closed. UK PM Andy Burnham announced a VAT cut on electricity bills, funded by scrapping the digital ID program, a modest fiscal stimulus. ECB lending survey showed credit tightening in Q2 on geopolitical risks, with further tightening expected. Nikkei rose 1.5% on tech buying, while Chinese markets fell over 1%. The dominant narrative is ESCALATING but with a potential de-escalation signal (mediation talks).