WS #12562

The US-Iran conflict has escalated dramatically with Iran claiming to have destroyed Amazon's main data center in Bahrain and attacked Kuwaiti oil infrastructure, power grid, and water desalination plants. Kuwait's oil production has collapsed to 500,000 bpd from 2.5 million bpd, and the Strait of Hormuz shipping disruption is now expected to continue into 2027, with traders seeing only a 31% chance of normalcy before December 2026. Oil prices are projected to surge past $115 as Trump orders a Hormuz blockade, with the UK refusing to join. However, a counter-signal emerges: international efforts to disarm Hezbollah are being explored, and the US, Israel, and Lebanon are discussing strategies, suggesting diplomatic channels remain open. Separately, the US Trade Representative signaled a new round of tariffs could be coming soon as existing duties near expiration, adding to trade war uncertainty. On the corporate front, GM reported a strong Q2 beat (EPS $3.57 vs $3.18 est), sending stock up 5%+. Tesla expanded robotaxi service to Orlando and Tampa ahead of earnings, while a $107.54M dark pool order in QQQ signals institutional interest. The dominant narrative is ESCALATING on the geopolitical front, with oil prices surging and supply disruptions worsening, but the Hezbollah disarmament talks provide a potential de-escalation path.