WS #13738

The dominant theme remains the escalating US-Iran conflict and its impact on global energy markets, with several new developments this cycle. Iran has formally set six preconditions for reopening the Strait of Hormuz, including lifting sanctions, withdrawing US forces, and paying war compensation, with the Revolutionary Guards vowing to keep the strait closed until all conditions are met. This hardens the bearish oil supply thesis. However, a potential counter-signal emerged: WSJ reports Trump is privately willing to end the war without a nuclear deal if Hormuz fully reopens, and Axios confirms Trump is 'low-keying it' with Iran, preferring economic pressure over new military action. This suggests a possible de-escalation path, though Iran's demands complicate it. Meanwhile, the Houthis attacked Saudi Aramco's Jizan refinery and a Yemeni port, killing at least 11, extending the supply disruption to the Red Sea. The Pentagon is pressing defense contractors to accelerate weapons production, with a $58.6B Patriot missile deal awarded to Lockheed Martin, signaling sustained defense spending. On the macro side, gold surged 7.39% to $4,401 after weak US jobs data, with markets now pricing Fed pause/cut. Apple is reportedly in talks with Chinese DRAM maker CXMT for memory chips, a politically sensitive move that could impact the semiconductor supply chain. These developments point to continued energy bullishness, defense sector strength, and potential gold upside, while the Iran war narrative shows signs of potential de-escalation but remains unresolved.