WS #13712

The Strait of Hormuz crisis remains the dominant market theme, and it is ESCALATING. Iran's Supreme National Security Council, via secretary Mohammad Bagher Zolghadr, issued a six-point demand list for reopening the strait, including lifting the naval blockade, withdrawing US forces, paying war reparations, lifting sanctions, and releasing frozen assets. This is corroborated by multiple sources (Reuters, Al Jazeera, NOS, VOV, and others). Simultaneously, Foreign Minister Araghchi said Iran and Oman are 'very close' to a new shipping protocol, but the strait will not reopen immediately and additional conditions (including US compensation) must be met. IRGC spokesperson Mohebi reiterated that reopening depends on the US 'fully' accepting Iran's conditions. This dual-track messaging—progress on an Oman deal but hardline conditions on the US—creates uncertainty for oil markets. Additionally, the UAE reported an Iranian missile attack on an ADNOC tanker in the strait, and Saudi Arabia condemned it, adding to geopolitical risk. The US position, per VP Vance, is that Washington is 'in the middle of the game' and assessing whether Iran will make changes; he claimed the US 'destroyed' Iran's nuclear program. The 60-day negotiation period from the June interim deal ends in just over a week, adding a near-term catalyst. This is a high-significance geopolitical development with direct implications for energy prices and risk sentiment. Separately, the Pentagon has ordered a surge in arms production due to depleted missile stockpiles from the war with Iran, which is bullish for defense contractors. Also notable: a Ukrainian drone exploded near a Bulgarian gas pipeline compressor station, raising energy infrastructure risk in Europe. On the corporate front, several earnings surprises emerged: Sweetgreen missed by $0.09 EPS and cut guidance (bearish SG), Parker-Hannifin beat by $0.98 EPS and raised guidance (bullish PH), Post Holdings beat EPS but revenue missed and stock fell 12.8% (bearish POST), and Doximity surged 40% on earnings (bullish DOCS).