WS #13777

The dominant theme remains the US-Iran/Hormuz standoff, which is ESCALATING. Iran's Revolutionary Guards explicitly stated the Strait of Hormuz will not reopen until the US meets a list of demands including compensation, sanctions relief, and an end to military threats, with Foreign Minister Araghchi denying direct talks. This was corroborated across multiple sources (Al Jazeera, Reuters, GDELT, Business Today, Press TV). Oil prices rose ~1% on Monday (Brent ~$84.46, WTI ~$78.79) after falling 7% last week on hopes of a deal, as traders await tangible evidence of reopening. A Saudi Aramco refinery (Jazan) was attacked by Houthis over the weekend, adding to supply risk. US Senator Chris Murphy warned the US has used 'almost all' interceptors and most Tomahawks, and that Trump 'lost this war', while the WSJ reports Trump's options for walking away have narrowed. This is a high-significance geopolitical development with direct energy market implications. A counter-signal exists: Goldman Sachs expects oil to soften below $70 by year-end assuming a deal is close, but this is the optimistic end of the spectrum and contradicted by the latest tanker strike and IRGC statements. China's crude imports are absorbing the shock, masking the true scale of the disruption, which could delay price spikes but also sets up a September tightening. Separately, Sony and TSMC announced a $6.3bn (1 trillion yen) investment in a Kumamoto image sensor plant targeting 2029 production, a bullish signal for semiconductor supply chain and TSMC-related names. BOJ's July Summary of Opinions showed a hawkish split, with members calling for faster rate hikes, supporting the yen and pressuring JGB yields. US July CPI due Wednesday is the key macro event, with expectations for core CPI at 2.5% YoY; a soft print could reduce September hike odds further.