WS #14172

The dominant US-Iran/Hormuz narrative remains in an escalation phase, with multiple new data points reinforcing the bullish oil thesis. A third ADNOC tanker was attacked in the Strait of Hormuz in the past week, and Iran's judiciary chief has vowed a 'resolute response' to any 'adventurism' in the strait, directly countering Trump's annexation rhetoric. The US Strategic Petroleum Reserve has fallen below 300 million barrels for the first time since the early 1980s, with experts warning of potential cavern damage, while the US military has reportedly used 'virtually all' of its long-range precision missiles (ATACMS/PrSM) during the war. These developments collectively point to sustained supply disruption risk and elevated oil prices, with Brent settling near $88.5 and WTI near $82-83. The Israel-Iran ceasefire narrative is also showing strain, with Israeli strikes on southern Lebanon and a Hezbollah drone strike wounding three Israeli troops, suggesting the ceasefire is fragile. This is a high-signal window for energy and defense-related equities, with a clear bearish undertone for airlines and other oil-consuming sectors.