WS #14356

The US-Iran conflict has re-escalated sharply, with US forces striking Iranian rocket launchers on Larak Island in the Strait of Hormuz and Iran retaliating with ballistic missiles and drones against US bases in Jordan and the UAE's Al Minhad base. This marks the first direct US strike on Iran since late July, breaking a month-long lull. Brent crude has surged above $90/barrel (up ~2.5%), with WTI near $85, as the market prices in renewed Hormuz shipping risk. The escalation is corroborated across multiple sources (Reuters, AP, GDELT, OSINT, and regional outlets). Treasury Secretary Bessent has announced weekly secondary sanctions on banks to isolate Iran financially, with the next bank sanction expected this week. A counter-signal is the US-Venezuela oil deal, where the US claims control of 65 billion barrels of reserves to refill the Strategic Petroleum Reserve, but this is early-stage and cannot offset immediate supply risks. The Fed rate-hike narrative is intensifying: Fed Chair Warsh's hawkish Jackson Hole speech has pushed September hike odds to ~57-60%, pressuring Asian equities, gold, and the yen (which breached 160/USD). Barclays now expects hikes in both September and December. The US-Canada trade war is also escalating with Trump's 50% tariffs on Canadian autos and steel, pressuring Canadian-linked equities and benefiting US manufacturing. Apple's September 9 iPhone event and new CEO John Ternus taking over September 1 are notable but secondary to the macro risk-off tone.