Recap | July 13, 2026
- 1 day ago
- 6 min read
Relevant summaries written by a research analyst. Commentary - not advice. | Disclaimers
| US and Iran resume hostilities with Strait of Hormuz back in contention
| Houthis and Saudi Arabia face risk of broadening Middle East conflict to Yemen
MARKETS & ECONOMIES | Oil prices spike alongside renewed supply concerns, stocks dip
| Fed Chair testifying before Congress with FOMC inflation debate looming
ADDITIONAL ITEMS | Ukraine, Europe eye joint missile defense as US weighs Russia sanctions
| White House signals preemptive challenge to midterm elections
By Edward von der Schmidt
Headlines
US and Iran resume hostilities with Strait of Hormuz back in contention
The US and Iran exchanged multiple series of strikes after their Memorandum of Understanding fell through last week.
Both countries announced an effective closure of the Strait of Hormuz, imperiling passage and hazarding commodity shortages.
In addition to reimposing a blockade, President Trump announced that the US would require payment for transit protection.
Although talks will continue, the end of a notional ceasefire along with intractable negotiating positions suggest a challenging return path toward deescalation. Attacks on shipping, competing assertions of control, and the imposition of tolls all threaten freedom of navigation in a crucial trade corridor. If the fighting does not subside and allow for a resumption of traffic through the strait, the combination of depleted global stockpiles and sustained supply shortages could eventually precipitate an energy crisis.
SOURCES:
US attacks Iran as Tehran retaliates against UAE tankers in Strait of Hormuz and Bahrain (AP)
U.S. military renews strikes on Iran while tankers come under attack in Strait of Hormuz (Reuters; 7/12)
US Hits Iran With Strikes, Blockade as Trump Plans Hormuz Charge (Bloomberg)
U.S. Launches New Iran Strikes, as Trump Weighs Attacking Nuclear Site (WSJ)
FURTHER READING:
Hormuz traffic slows to two-month low as renewed US, Iran strikes raise safety risk (Reuters; 7/12)
Explainer: Why has the Iran-US ceasefire memorandum frayed? (Reuters)
Trump sends Congress formal notice that Iran conflict has resumed (Reuters)
Trump's Hormuz Demand Implies Fee of $30 Million Per Supertanker (Bloomberg)
Houthis and Saudi Arabia face risk of broadening Middle East conflict to Yemen
Attacks on airports disturbed a 2022 ceasefire that followed years of civil war in the Kingdom's southern neighbor.
Further antagonism could potentially jeopardize Red Sea shipments bypassing Iran.
A military engagement with Saudi Arabia might prompt the Houthis to target Red Sea traffic and disrupt transit through the Bab al-Mandeb Strait, which could curtail redirected oil exports and exacerbate shortages arising from a lasting closure of the Strait of Hormuz.
SOURCES:
Yemen's Houthis strike Saudi Arabia's Abha airport with missiles and drones in a sharp escalation (AP)
Houthis fire missiles at Saudi Arabia, breaking years of calm (Reuters)
Iran-Backed Houthis Strike Saudi Arabia in Major Escalation (Bloomberg)
Markets & Economies
Oil prices spike alongside renewed supply concerns, stocks dip
Crude futures had their largest daily percentage gain in six years (WSJ) and climbed to their highest levels in a month amid US-Iran fighting and oil supply concerns.
Chip sector volatility continued to drive equity index performance as US benchmarks fell ahead of major earnings releases.
SOURCES:
Oil prices jump following the latest fighting in the Middle East, while AI stocks sink (AP)
Oil surges, stocks slip and bond yields rise as Gulf conflict flares up again (Reuters)
Brent Tops $85, Rate-Hike Bets Rise Before US CPI: Markets Wrap (Bloomberg)
Oil Surges Most Since 2020, Reflecting Bet That Strait Won't Go Back to Normal (WSJ)
FURTHER READING:
Dollar steady before US inflation data, yen under pressure (Reuters)
Trillion Dollar Chip Rout Trains Spotlight on TSMC and ASML Results (Bloomberg)
Fed Chair testifying before Congress with FOMC inflation debate looming
Kevin Warsh will deliver his first semi-annual testimony before the House and Senate on Tuesday and Wednesday, respectively.
The central bank's latest Monetary Policy Report flagged near-term price pressures while offering constructive assessments of the economy.
Fed officials have cited persistent inflation risks as a potential catalyst for near-term rate hikes with June CPI data due out Tuesday.
Chair Warsh may be reluctant to hint at - let alone commit to - policy adjustments in his semi-annual testimony before the House Financial Services Committee and Senate Banking Committee. Tuesday's Consumer Price Index (CPI) readings for the month of June will shape inflation narratives leading into the July 29 FOMC, where the Fed will presumably consider a modest rate hike to stem price momentum and manage expectations even if they ultimately choose to hold off.
Palatable core inflation could keep policy tightening at bay, but the confluence of contagion from AI component shortages and any fresh energy shock could sway officials to pull the trigger sooner than later; futures markets implied even odds for a July hike as of Monday (Bloomberg).
Warsh appears to prefer talking down inflation for now rather than acting upon it, so the next two weeks will also test his ability to drive consensus among his colleagues.
SOURCES:
https://www.federalreserve.gov/monetarypolicy/publications/mpr_default.htm
America In Focus: Fed officials divided on US inflation views; US home prices hit all-time high (AP; 7/11)
Fed report cites 'stepped-up' inflation due to tariffs, Iran war, AI buildout (Reuters; 7/10)
Fed officials fret over inflation risk, weigh rate hikes (Reuters; 7/10)
Fed Rate-Hike Bets Mount Before Inflation Data, Warsh Testimony (Bloomberg)
Waller Says Fed May Need to Raise Rates to Tame Core Inflation (Bloomberg)
Fed Vows to Deliver Price Stability in Monetary Policy Report (Bloomberg; 7/10)
Fed's Williams Says AI Is Now His Main Inflation Concern (Bloomberg; 7/9)
Warsh's First Big Call: Whether to Undo Last Year's Cuts (WSJ)
FURTHER READING:
Massive AI buildout poses latest inflation threat as consumers pay more for laptops and electricity (AP)
Falling gas prices likely cut inflation last month but renewal of Iran war could undo progress (AP)
Who is on Fed chief Warsh's review task forces? (Reuters; 7/10)
Additional Items
Ukraine, Europe eye joint missile defense as US weighs Russia sanctions
Ten countries including Ukraine announced a collaborative missile defense initiative after the "Coalition of the Willing" met in Paris.
The US is also considering Russian sanctions legislation championed by the late Senator Lindsey Graham.
Relentless missile strikes have exposed critical shortages of air defense systems and munitions, leaving Ukraine and Europe to seek alternatives and explore an "Integrated Anti-Ballistic Missile Coalition" for future production.
Notwithstanding their tactical drone incursions targeting key infrastructure, Ukraine's exposure to Russia's air attacks has reduced the latter's incentive to pursue a mediated resolution or direct talks. Given the risk of compounding energy price increases, whether the US follows through on proposed sanctions to put pressure on Russia is an open question.
SOURCES:
Ukraine and 9 other countries announce a coalition to protect Europe from ballistic missiles (AP)
Ukraine and allies set up coalition to tackle Russia ballistic missile threat (Reuters)
A US license could let Ukraine produce Patriot missiles, but it won't be simple or quick (AP; 7/10)
US senators say agreement reached with Trump on Russia sanctions bill (Reuters; 7/10)
Trump to Back Graham's Russia Sanctions Bill, White House Says (Bloomberg)
FURTHER READING:
Ukraine's prime minister steps down as Zelenskyy announces government reshuffle (AP; 7/12)
Ukraine awaits new government after prime minister's shock dismissal (Reuters)
Premier Radev Pulls Bulgaria Out of Coalition of the Willing (Bloomberg)
14 nations and the EU reaffirm 2016 ruling invalidating China's claims in South China Sea (AP; 7/12)
White House signals preemptive challenge to midterm elections
President Trump has repeated concerns about election security, calling for legislation and increased federal scrutiny.
Recent measures have focused on voter rolls and eligibility.
The administration may view a mid-term change of control in Congress as an existential threat, akin to Richard Nixon's Pyrrhic election victory in 1972. In that case, they could commit to challenging adverse results and begin by setting the stage to do so.
SOURCES:
Trump to assert voting machine vulnerabilities in Thursday Speech (Reuters via MS Now)
Trump administration ties states' anti-terrorism grants to election security (Reuters; 7/10)
Trump fires Election Assistance Commission members ahead of midterms (Reuters; 7/9)
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