Mon., July 13, 2026
[4:10 PM ET…closing prices for stocks, 3:50ish for commodities and bonds]
Tale of the Tape at the gas pump, nationwide averages, courtesy of AAA.
Fri., Feb. 27…regular $2.98…diesel $3.75
Mon., July 13…regular $3.87…diesel $4.87
It was a weekend of tit-for-tat military exchanges between the United States and Iran, with Iran saying it had closed the Strait of Hormuz after a warning shot fired by the Iranian Revolutionary Guard Corps (IRGC) struck a Cypriot-flagged commercial cargo ship, which suffered “significant engine room damage,” with a civilian crew member missing.
The U.S. over three nights hit more targets around the Strait, striking air-defense systems, coastal radar sites, missile and drone capabilities, and small boats.
In response, Iran targeted U.S. bases in Jordan, Bahrain, and Kuwait, as well as targets in Oman and Qatar, though there were no hard reports of damage or injuries.
Shipping through the Strait plummeted over the weekend after Iran struck the Cypriot ship, with limited traffic on Sunday and none spotted early Monday.
Oman has circulated its own proposal for joint administering the Strait alongside Iran, including the potential imposition of service fees on transiting ships, though Oman wouldn’t charge a fee for its corridor.
But then at 10:16 AM this morning, President Trump posted on Truth Social:
“The Hormuz Strait is OPEN, and will remain OPEN, with or without Iran. We are reinstating THE IRANIAN BLOCKADE, so named because it is only stopping Iran’s ships or customers from entering or leaving. All other countries will have fair and open use of the Strait. The U.S.A. will be, from this point forward, known as ‘THE GUARDIAN OF THE HORMUZ STRAIT,’ but as such, and as a matter of FAIRNESS, will be reimbursed, at the rate of 20% on all cargo shipped, for any and all costs necessary to do the job of providing safety and security to this very volatile section of the World. The process and formation will begin immediately. Thank you for your attention to this matter!”
[For centuries the U.S. stood for freedom of navigation, and free passage, in the seas.]
Trump had earlier said on Fox News in a phone interview: “We’re taking over the Strait. They’ve got nothing,” asserting that the U.S. would be “reimbursed” by other Middle East countries.
Trump told Fox that on Sunday, July 12, U.S. negotiators thought they had a deal for a long-term peace plan with Iran following an 11-hour meeting, but Iranian leaders later made new demands.
“What nobody knows, we had a deal. It was a done deal, and then they broke it. They always break it. We’ve had 10 deals with these people, and so we’re just going to hit them very hard,” Trump said.
I’m sorry…I don’t believe that we had a deal.
Iran’s armed forces said after Trump’s post, “We will under no circumstances allow the United States to interfere in the management of the Strait of Hormuz.”
I think you can say at this point the ceasefire is over.
In response to today’s actions, as well as the military escalation over the weekend, crude oil rose to more than $75 per barrel on WTI ($77 late today). Should a fee of 20% be imposed, at current prices such a fee would amount to roughly $32 million for a supertanker, far above previous Iranian transit charges of up to $2 million.
[Gasoline futures hit $3.15 this afternoon…not good, sports fans.]
Meanwhile, OPEC reduced its 2026 oil demand growth forecast to 800,000 barrels per day.
The stock market reacted negatively as you would imagine to the news out of Gulf, and it didn’t help that South Korea’s SK Hynix, which just made its New York debut on Friday, fell a record 15% in Seoul overnight, and 7% here, underscoring growing investor concerns that the boom in AI plays had become overstretched. The Kospi index was down 9% on Monday, with Samsung Electronics falling 11%.
But Taiwan Semiconductor Manufacturing Co. reported a 36% jump in quarterly sales, meeting elevated expectations while signaling global demand for AI computing remains intact.
The main chipmaker for Nvidia and Apple reported revenue for the June quarter of $39.6 billion, with sales up 68% last month alone.
For its part, SK Hynix said last week that it foresees memory-chip shortages persisting beyond 2030, as the spending spree by data center operators stokes appetite for both conventional memory and the high-bandwidth or HBM chips that work with AI systems.
One more, it was a lousy day in the bond market, fueled by both the inflationary news out of the Gulf, as well as hawkish comments from Fed Governor Christopher Waller, who said an interest-rate hike should be on the table if this week’s inflation data show price pressures remaining firm; the CPI report for June tomorrow, PPI on Wednesday.
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We have an epic Final Four for the World Cup. For the first time in the modern history of the competition, the top-four ranked teams in the world all reached the semifinals.
Tuesday…France vs. Spain in Arlington, TX…3:00 PM ET
Wednesday…England vs. Argentina in Atlanta, GA…3:00 PM ET
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Dow Jones -138…-0.3% [52498]
S&P 500 -59…-0.8% [7515]
Nasdaq -408…-1.6% [25873]
Oil (WTI) $77.70.…Brent $82.90
Gold $4000
Silver $57.60
Bitcoin $62,214 [4:00 PM ET]
U.S. 2-yr. 4.27%
U.S. 10-yr. 4.61%
Japanese 10-yr. 2.76%…last Friday, the 10-year yield here fell from its 30-year highs after Finance Minister Satsuki Katayama said the government would encourage domestic pension funds to increase their holdings of Japanese financial assets.
Back Tues.
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Brian Trumbore
