WS #12729

The dominant signal in this window is the escalation of the Houthi-Saudi conflict, with Houthi missile and drone attacks on Saudi Aramco oil installations in Jizan and Yanbu, confirmed by Reuters and The Guardian. This marks a significant escalation as the war threatens to spread to a second major shipping route (Red Sea) and reignite Yemen's civil war. Simultaneously, a potential de-escalation signal emerged: Iran reported its first night without US strikes in two weeks, suggesting a possible pause in US-Iran hostilities. However, the Houthi attacks on Saudi oil infrastructure compound the blockade on Saudi Arabia, raising costs for Saudi air operations and threatening global oil supply. Chevron has asked the Trump administration to protect its Kazakhstan oil operations after Ukrainian drone strikes damaged tankers, adding another layer of energy supply risk. The US imposed new tariffs of 10-12.5% on 60 trading partners, replacing temporary levies, which could weigh on trade-sensitive sectors. Gold held above $4,000 amid Middle East conflict and Fed rate hike expectations. The Houthi-Aramco attack narrative is ESCALATING, while the US-Iran direct conflict narrative shows a potential DE-ESCALATING signal (pause in US strikes).