Mar 4, 2026

Oil closes at 2024 high before U.S. grants India waiver

Late news kept energy and defense risk elevated, though Asia saw some relief as crude and the dollar slipped. U.S. retail earnings split, and Washington added supply flexibility for India.• Oil/Markets: U.S. crude settled up 8.5% at $81.01, its highest since July 2024 and biggest one-day gain since 2020; the Dow closed down 784 points, or 1.6%.• Energy Policy: Treasury issued a 30-day waiver letting Indian refiners buy Russian crude and products already stranded at sea, expiring April 4; Bloomberg said oil briefly cooled.• Defense/Iran: Hegseth said U.S. firepower over Iran is about to “surge dramatically” after UK base access; Centcom said Iranian ballistic attacks are down 90%.• Gulf Spillover: Kuwait reported 67 armed-forces injuries and two deaths; WSJ said the UAE is weighing freezing billions in Iranian assets, not a decided action.• Retail: Costco profit beat expectations, while Gap missed after Old Navy and Athleta underperformed.

Dow drops 1,000 points after Bahrain refinery strike widens energy risk

Risk-off trade deepened while Gulf infrastructure and airspace disruptions broadened, with energy the only S&P 500 sector higher.• Markets/Energy: The Dow fell more than 1,000 points; Brent traded near $84 and WTI above $77 after Bahrain said an Iranian missile hit a Bapco refinery unit, though the fire was contained and operations continued.• Aviation/Spillover: Azerbaijan closed part of its airspace after saying four Iranian drones targeted civilian sites; missiles near Dubai forced an Air France evacuation charter to turn back.• Tech/Chips: Software outperformed sharply, with IGV up about 6.5% versus a 5.7% drop in SOXX; NVDA fell more than 1% on reported draft U.S. AI-chip export curbs.• Banks/Policy: WFC’s final fake-accounts consent order was terminated, while MS fell about 2.6% after reports of 2,500 layoffs.

Rate-cut bets fade after energy prices lift inflation risk

Rates and energy logistics drove the market read, with inflation risk cutting Fed-easing odds while Gulf rerouting and insurance plans sought to keep barrels moving.• Rates/Macro: CME futures now imply less than a 50% chance of at least two Fed cuts in 2026, down from 79% at last week’s end, after energy prices rose and claims stayed subdued.• Energy/Shipping: Saudi Aramco is diverting more crude exports to Yanbu via its 5 million b/d East-West pipeline; Lloyd’s underwriters said private Hormuz war-risk cover remains available.• Regional Spillover: Qatar reported another missile attack, while Azerbaijan banned Iranian trucks at all border crossings; Iran denied launching the drones and blamed Israel.• Company News: Broadcom rose about 7% premarket after results beat forecasts and AI revenue more than doubled; ICE invested in OKX at a $25 billion valuation.

Iranian drones hit Azerbaijan as Kospi rebounds nearly 10%

Risk signals were mixed: Asian equities stabilized, but the conflict widened toward Azerbaijan and China took tentative steps on energy and diplomacy.• Regional Spillover: Azerbaijan said Iranian drones hit Nakhchivan, damaging an airport terminal, injuring two civilians and prompting a warning of possible retaliation; the route matters because Israel receives Azerbaijani crude via Turkey.• Asia Equities: South Korea’s Kospi rose nearly 10% after Wednesday’s 12% rout, triggering circuit breakers; Samsung Electronics gained 11.3%, SK Hynix 10.8% and Hyundai Motor 9.4%.• China/Energy: A senior Chinese state-firm executive said China’s top planning officials verbally told companies to suspend refined-oil exports; the report was not framed as a public written order.• Diplomacy/Military: China said it would send a Middle East envoy, while Israel launched another broad wave of strikes on Tehran and hit Hezbollah command centers in Beirut.

Tanker leaks oil off Kuwait as Saudi Arabia intercepts missiles

Maritime and regional spillover risks worsened, adding fresh pressure to energy logistics and keeping defense demand in focus.• Maritime/Energy: A tanker anchored 30 nautical miles southeast of Kuwait reported a large port-side explosion, took on water and leaked oil from a cargo tank; the crew was safe.• Hormuz/LNG: WSJ reported about 3,000 vessels are trapped in the Gulf, including the LNG tanker Gaslog Skagen with 155,000 cubic meters of LNG, after an IRGC radio warning barred Strait of Hormuz navigation.• Gulf Security: Saudi Arabia said it destroyed three cruise missiles and three drones near Al-Kharj and another drone near Al-Jawf; the origin was not specified.• Defense Supply: WSJ said Patriot use in the Iran war is draining interceptors needed by Ukraine and could force U.S. pulls from other regional stockpiles.

Iran launches drop as Treasury yields climb on inflation fears

News flow showed some tactical easing in Iran’s missile threat, but U.S. duration, legal authority and rate/inflation risks remained market overhangs.• Military/Geopolitics: CENTCOM said Iran’s missile launches have fallen 86% and drone launches 73% in four days, and U.S. forces have sunk more than 20 Iranian vessels; officials cautioned Iran can still use cheaper drones.• Rates/Macro: The energy shock pushed the 10-year Treasury yield as high as 4.1%, ending the bond rally and pressuring TLT.• Policy/Congress: The Senate blocked a war-powers resolution 53-47; Rand Paul was the lone Republican yes, and John Fetterman was the lone Democratic no.• NATO/Diplomacy: Spain categorically denied the White House claim that it agreed to cooperate militarily, keeping the base-access dispute unresolved.• Regional Spillover: Israel reported new Tehran and Hezbollah strikes; Lebanon said a strike near Beirut killed three and injured six.

LNG prices soar after QatarEnergy declares force majeure

Energy disruption broadened from oil into LNG and refined products, while Washington signaled a longer campaign and NATO exposure increased.• Energy/LNG: QatarEnergy declared force majeure after halting LNG production; NYT said Asian LNG benchmark jumped 91% since last week and Europe rose 44%, benefiting SHEL, TTE, XOM and LNG.• Energy/Ports: Fujairah fuel suppliers also declared force majeure after drone-debris damage and a fire; AAA put U.S. regular gasoline at $3.20 and diesel above $4.• Military/Policy: Hegseth said the Iran campaign could last up to eight weeks and that a Tuesday strike killed the head of an Iranian unit tied to a Trump assassination plot.• NATO/Defense: A U.S. destroyer shot down a missile headed for Turkey’s Incirlik base; Trump plans to meet defense executives Friday on weapons production.

U.S. torpedoes Iranian warship as Iraq halves oil output

Energy and geopolitical risk stayed elevated, with fresh crude disruptions and a wider military footprint offsetting limited efforts to reopen transport channels.• Oil/Supply: Iraq has more than halved output as storage fills; Rumaila fell 700,000 b/d, West Qurna 2 by 450,000 b/d and Maysan by 350,000 b/d.• Oil/Security: Saudi Arabia said an Iranian drone targeted Aramco’s Ras Tanura again but caused no damage; Bessent said Washington is preparing insurance and escort measures for Hormuz.• Military/Naval: Hegseth said a U.S. submarine torpedoed the IRIS Dena near Sri Lanka, killing at least 87; he also said U.S. forces sank Iran’s Shahid Soleimani.• NATO/Turkey: Turkey said NATO intercepted an Iranian missile; Iran denied firing it, while U.S./Western officials said Incirlik was the target.• Aviation: Emirates extended scheduled-flight suspensions through Saturday; Virgin restarted Dubai and Riyadh service, with Dubai traffic still about 80 moves versus 1,200 last week.

Kospi plunges as Hormuz blockage forces Iraq output cut

Risk-off pressure spread into Asian equities and energy logistics worsened, while the conflict drew more congressional and evacuation responses.• Asia/Equities: South Korea’s Kospi plunged 12%, its worst daily drop on record, taking two-day losses to 18%; shipping stocks led declines on fuel-cost and Hormuz safety fears.• Oil/Hormuz: Kayrros said Saudi and Iraqi storage sites are filling rapidly; Iraq said it cut oil production because of strait limitations, with others at risk of curtailments if tank tops are reached.• Gulf/Air Defense: Kuwait said falling debris killed a girl after interceptions, while Saudi Arabia said it destroyed nine drones; Iraq intercepted a drone near Baghdad airport without damage.• US/Defense: CENTCOM said U.S. forces hit nearly 2,000 targets with more than 2,000 munitions; initial reports said a Kuwaiti F/A-18 mistakenly downed three U.S. F-15s.• Policy/Evacuations: NYT reported Senate Republicans blocked War Powers limits; State ordered departures from U.S. consulates in Lahore and Karachi and raised Cyprus travel warnings.

U.S. sites show communications damage after Iranian strikes

Geopolitical risk worsened on evidence that Iran targeted U.S. command infrastructure, while Tehran’s succession process pointed to a hard-line continuity scenario.• U.S. military: NYT analysis found weekend and Monday Iranian strikes damaged structures at or near communication and radar systems on at least seven U.S. sites in Bahrain, Kuwait, Saudi Arabia and the UAE; CENTCOM declined comment.• U.S. casualties: At least six U.S. service members have been killed, all in a Sunday drone attack at Kuwait’s Shuaiba port, up from the three deaths previously confirmed.• Iran leadership: Iranian officials said Mojtaba Khamenei emerged as the clear front-runner for supreme leader, with an announcement possible Wednesday, though some clerics feared making him a target.• War toll: Reported deaths topped 870, including 787 in Iran, with fatalities also in Bahrain, Kuwait, the UAE, Lebanon and Israel.