WS #13917

The Middle East oil supply disruption narrative remains in an ESCALATING phase, with multiple sources confirming Iran's refusal to reopen the Strait of Hormuz and continued Houthi attacks in the Red Sea. Iran's Supreme National Security Council head explicitly stated the strait will remain closed until the US accepts its conditions, directly contradicting Trump's claim of 'total control.' The IEA has deepened its 2026 oil supply forecast cut by 600,000 bpd to a 4.3 million bpd decline, calling it 'the largest global oil supply disruption ever,' while Brent crude trades near $90. This continues to support energy names (XOM, CVX) and pressure airlines (DAL, UAL) and shipping (MATX, ZIM). A counter-signal emerged: reports that the US and Iran agreed 'in principle' to extend the 60-day ceasefire, but Iran's senior source denied any extension discussions, keeping the risk premium intact. Separately, the AI infrastructure trade remains robust: CoreWeave surged 18% premarket on a Q2 beat and raised FY26 guidance to $12.4B, Super Micro jumped 9% on record AI server backlog, and Lumentum's strong results lifted optical networking names like Coherent. Nvidia's $500B financing partnership is being scrutinized as potential leverage risk, with Michael Burry calling it a 'Wall Street stunt,' but the immediate market reaction is positive for AI infrastructure names. The July CPI report is due today; consensus is +0.1% MoM headline, +3.4% YoY, with core +0.2% MoM. A softer print could trigger a dovish repricing, while a hot print may be muted given Fed chair Warsh's reluctance to hike. The dollar is firm, gold is up, and European markets are mixed with the DAX at record highs. Also notable: Bank of America announced a $250B infrastructure finance initiative, and Intel raised $20B in its first share sale since 1971, both signaling strong capital flows into AI and infrastructure.