AGP Executive Report

US-Iran De-escalation: Trump says he cancelled planned US-Israeli strikes on Iran after Tehran and other Middle East partners asked for a pause, with a “rapid” deal framework tied to the “immediate, complete and total” reopening of the Strait of Hormuz and an end to Iran’s nuclear threat; Israel is said to have joined the commitment, while Iran warns of decisive retaliation if attacks resume. Energy Security & Shipping: The Hormuz focus is driving market nerves, with US embassies urging Americans to prepare for flight cancellations and airspace closures as escalation risk remains. Iraq–Türkiye Oil Corridor: Ankara and Baghdad extended their Kirkuk-Ceyhan/Ceyhan pipeline deal for one year, targeting at least 750,000 bpd to keep exports flowing as an alternative route amid Hormuz disruption. Cyber Threats: US authorities warn multiple states faced cyberattacks on water systems, with intelligence officials suspecting Iran behind a coordinated push—raising broader concerns for energy and water infrastructure resilience. Regional Economic Ripples: Middle East airline demand fell 14% y/y in June, reflecting ongoing conflict uncertainty and fuel-price pressure. Cyprus Gas Deal: Shell agreed to sell its 35% stake in Cyprus’ Aphrodite gas block to MOL for up to $720m, supporting regional gas supply planning.

Iran-US escalation: Trump said the US will hit Iran “very hard,” with reports of possible weekend strikes that could target energy infrastructure. Travel & security alerts: US embassies across the Middle East urged Americans to consider leaving or be ready to depart, warning of flight cancellations, airspace closures, and “unforeseen escalation.” Energy infrastructure risk: Iran defended its Hormuz blockade and tanker strikes as lawful self-defence, while warning Gulf states and Israel that attacks on civilian infrastructure could trigger wider retaliation. Markets & shipping: Oil prices settled higher, logging the strongest month since March, as Hormuz disruptions and tanker incidents kept crude flows tight; UN chief Guterres called for an immediate end to the conflict and restoration of navigation rights. Regional supply moves: Iraq and Türkiye signed a one-year deal to export at least 750,000 bpd via the Kirkuk–Ceyhan pipeline, aiming to reduce reliance on Gulf shipping lanes. Project momentum: Eni and TotalEnergies approved investment for Cyprus’ first offshore gas field, with gas slated for Egypt’s Damietta LNG hub. War’s side effects: A fire broke out at an oil refinery in Hewlêr (Erbil), while Houthis claimed they forced eight Saudi oil tankers to change course. Corporate windfall: ExxonMobil and Chevron posted blowout profits tied to the war-driven supply shock, even as gasoline prices stay politically sensitive.

Iran-U.S. energy escalation: The US and Israel are reportedly preparing large-scale strikes on Iran’s energy infrastructure (power plants and oil refineries), with talk of action as early as the Aug 1-2 weekend, while Trump says the US will hit Iran “very hard” to force concessions. Retaliation threats: Iran warns it has “extensive response plans,” including targeting US and Israeli energy infrastructure, as lawmakers in Washington again fail to rein in the war via a War Powers vote. Strait of Hormuz shipping risk: UKMTO says a tanker near Oman’s Lima was hit and disabled, with another explosion reported near Khasab—on top of claims of tankers being rerouted amid renewed blockade fears. Crypto sanctions pressure: The US Treasury sanctions Iranian crypto exchanges and freezes nearly $1bn in crypto, tracing billions in Iran-linked flows—aimed at choking sanctions evasion routes. Egypt power costs: Egypt’s electricity ministry raises 2026 residential tariffs, averaging ~12% for most consumption brackets while keeping the first bracket unchanged. Regional energy corridors: Azerbaijan and Türkiye agree to accelerate interconnector and green corridor projects, pushing energy security beyond oil.

Strait of Hormuz & Red Sea Security: Iran says it has halted two tankers under US escort and claims “transit…is not possible,” while US officials insist the strait remains open—keeping crude prices volatile as shipping risk spills into broader energy routes. Saudi Arabia meanwhile is pushing a 14-nation maritime defense coalition to protect Red Sea energy lanes, with Riyadh hosting the HQ and joint operations center. Oil Market Shock: July’s war-driven price lift is showing up in refined products too, with diesel up 27% and gasoline up 8% for the month, and analysts warning refining limits could keep prices elevated. Big Oil Windfalls vs Politics: Exxon and Chevron posted record quarterly profits tied to supply disruptions, but executives warn gasoline prices may stay high, raising political pressure as voters feel the pump pain. Cyber & Civil Infrastructure: US officials are investigating whether Iran-linked hackers targeted dozens of Minnesota municipal water systems, with reports citing operational disruptions but no evidence of unsafe drinking water. Environmental Risk: Reuters reports an oil spill from a shadow fleet tanker spreading off Oman, raising concerns for coastal damage during monsoon season. Regional Diplomacy: India’s foreign minister urged Iran to avoid attacks on commercial ships and seafarers amid renewed hostilities.

Middle East War & Oil Prices: Oil eased on Friday as tanker movement improved through key West Asia routes, with Brent down about 1.2% to $88 and WTI around $82, though both still track roughly a 20% monthly gain as the US–Iran conflict keeps a risk premium in markets. Red Sea Security: Saudi Arabia moved to set up a multinational maritime defense coalition to protect shipping in the Red Sea, Bab el-Mandeb and Gulf of Aden, with 14 countries backing the framework—aimed at safeguarding energy supply lines amid Houthi threats. Egypt Damietta Port Shock: Iran’s foreign minister warned against “false-flag operations” after a drone attack sparked fires at Egypt’s Damietta Port involving gas vessels; Egypt says it recovered wreckage and is investigating, while the incident raises fears for Suez-linked energy exports. Kuwait Escalation: Iran claimed drone strikes hit a US base in Kuwait, as the wider exchange of strikes continues across the region. Retail Fuel Pressure: UAE petrol prices are set to rise in August for a second straight month, reflecting volatile crude swings tied to renewed hostilities. Energy Trade Resilience: Pakistan received another long-term LNG cargo from Qatar, boosting gas security despite Strait of Hormuz risks. Regional Spillover Costs: The ADB approved $450m support for Cambodia and Sri Lanka as Middle East conflict pressures household budgets and economies across Asia.

Damietta LNG Security: Qatar condemned drone attacks on two LNG vessels at Egypt’s Damietta port, calling it a direct threat to global energy supplies and urging de-escalation, as Egypt confirmed the fire was caused by a drone and investigations continue. Red Sea Shipping Shield: Saudi Arabia pushed ahead with a multinational maritime defense coalition to protect the Red Sea and Bab al-Mandab, with 14 founding countries and EU participation, as Houthi attacks keep pressure on oil tankers and trade routes. Hormuz Risk Premium: Markets tracked renewed US-Iran missile and drone exchanges and shifting hopes around Strait of Hormuz management talks, with oil prices whipsawing as investors weigh possible reopening against persistent security threats. War Powers Fallout: In Washington, the US Senate rejected a war powers resolution to limit Trump’s Iran authority (49-50), underscoring political friction at home while the conflict keeps disrupting energy expectations. Corporate Impact: Shell reported net profit tripling to $10.8bn in Q2, citing Middle East war-driven oil price strength even as gas output fell after damage at Qatar’s Ras Laffan hub. Public Pressure: An AP-NORC poll found about two-thirds of Americans say the Iran war has not been worth it, while Trump’s approval on handling Iran slipped—adding pressure as energy costs remain a key concern.

US-Iran Escalation: The US says it carried out a “heavy wave” of strikes on Iran, hitting dozens of IRGC targets after Tehran’s missile attack on US forces in Jordan; Iran’s state media reported casualties on Qeshm, while Jordan intercepted five missiles launched from Iran. US-Saudi Iraq Role: Washington and Riyadh also struck Iran-backed militias in eastern Iraq, killing at least 20 fighters and six Iranian advisers, with Gulf states backing Saudi self-defense. Shipping & Energy Risk: Strait of Hormuz traffic is reported at “crisis-era lows,” while drone attacks in Egypt’s Damietta port sparked fires on gas vessels and a US-linked tanker, raising fears the war is spreading beyond the Gulf. Oil Market Shock: Brent and WTI swung sharply as conflict risk flared, with tankers still leaving the region via alternative routes. Corporate Impact: Shell’s quarterly profit more than doubled to $9.84bn as higher oil and gas prices and trading volatility boosted earnings. Regional Energy Projects: Egypt signed an EGP 20bn deal for a high-voltage transmission line to evacuate Gulf of Suez wind power, while Kuwait and Jordan advanced solar and green ammonia plans. Red Sea Security: Saudi Arabia is pushing an international coalition to protect Red Sea shipping from Houthi attacks, after threats of blockade and tolls around Bab al-Mandab.

Oil Markets: Brent jumped more than 7% back toward $90 a barrel and WTI rose about 6–7% after Trump vowed a forceful response to an Iran missile attack on US forces in Jordan; the rally also got a boost from falling US crude inventories. Hormuz Pressure: Washington rolled out fresh sanctions targeting Iran-linked shipping and “extortion” networks tied to Strait of Hormuz transit, as Iran again tightened controls and rejected Oman’s shared-management idea. Iraq Strikes: US and Saudi forces hit Iran-aligned Popular Mobilisation Forces bases in eastern Iraq, killing at least 20, while Iraqi officials condemned the strikes as a sovereignty violation. Egypt LNG Disruption: Drone attacks sparked fires at Egypt’s Damietta port, hitting a US-owned floating storage LNG vessel and spreading to another gas tanker—no casualties reported, but it signals the conflict is reaching new energy hubs. Regional Air Defences: Jordan said it intercepted five Iranian missiles as tensions spiked across the Middle East. Business Impact: Baker Hughes warned Middle East disruptions may dent oilfield services revenue slightly, even as it expects overall spending to decline modestly.

Hormuz Flashpoint: Iran’s IRGC Navy says it stopped three oil tankers in the Strait of Hormuz after warnings were ignored, as Tehran keeps control of the key chokepoint. Saudi-US Iraq Strikes: Saudi Arabia says it carried out joint precision strikes with US CENTCOM in eastern Iraq against Iran-backed militia sites tied to drone attacks on Saudi oil facilities; CENTCOM says the strikes targeted logistics and weapons sites and that attacks on US forces failed. Regional Fallout: Iraq’s prime minister called an emergency national security meeting after the US-Saudi strikes, while Kuwait condemned the militia attacks as a threat to Gulf stability. Oil Market Whiplash: Oil prices swung on the renewed fighting—dropping earlier on hopes of easing US-Iran tensions, then jumping again after missile and strike developments. Energy Diplomacy vs Hard Power: Oman’s proposal for joint Hormuz management was rejected by Iran, which insists Iranian control over key transit routes. Supply-Route Watch: Shipping data showed Bab el-Mandeb traffic at its highest in a week, with some crude tankers exiting toward the Gulf of Aden and Pakistan. Egypt Gas Rumor Denied: An Egyptian source denied a reported new natural gas deal with Israel.

US-Iran brinkmanship: Trump says “good talks” with Iran are underway but warns he’ll strike “Pickaxe Mountain,” bridges and power plants if no deal is reached, while Iran’s deputy foreign minister rejects the idea of negotiations and points to Oman’s Hormuz proposal. Hormuz governance: Oman is pushing a Malacca-style system of voluntary fees and joint management for Strait of Hormuz; Iran rejects Oman’s earlier route-splitting idea and warns any country benefiting from frozen Iranian assets won’t be allowed to transit. Oil market swing: Oil prices slide on hopes of a US-Iran pause/ceasefire, with WTI and Brent easing as shipping fears cool. Saudi-Iraq drone war: Saudi air defenses intercepted and destroyed drones launched from Iraq targeting Eastern Province oil facilities; Saudi vows to respond, as Houthis claim attacks on Saudi-linked tankers. Turkey-Iraq energy push: Erdogan hosts Iraqi PM al-Zaidi in Ankara as both countries agree to deepen energy cooperation, including restarting the Kirkuk-Ceyhan pipeline and Turkey Petroleum taking a stake in Kirkuk. Yemen Red Sea risk: Houthis claim ballistic missile strikes on a Saudi oil tanker, keeping Bab el-Mandeb disruption risk in focus.

Hormuz diplomacy: Oman has proposed a joint regional mechanism to manage the Strait of Hormuz with voluntary fees, aiming to prevent Iran from exercising sole control and to help restart shipping after the US paused strikes; Iran’s foreign minister also held talks with Saudi and Omani counterparts on stabilising the waterway. Oil prices & markets: Crude slid sharply as hopes of renewed US-Iran talks grew and attacks were paused, with Brent and WTI both down around 1.7–2% in early trading; traders are still watching Red Sea and Bab el-Mandeb risks as shipping remains choppy. Shipping flows: Bab el-Mandeb traffic rose to a four-day high while Hormuz traffic stayed weak, underscoring how quickly energy routes can swing with diplomacy or renewed strikes. Regional security spillover: Saudi Arabia said it shot down drones targeting its petroleum facilities, while Iran-linked attacks and counterclaims keep the threat of escalation alive. Energy infrastructure: Eni and TotalEnergies took FID for Cyprus’ first gas development, feeding LNG via Egypt’s Zohr and Damietta. Policy pressure in the region: Pakistan approved amendments to modernise refineries for Euro-V petrol and diesel, while consumer groups in the Philippines criticised moves to scrap electricity system loss charges as not fixing deeper energy-cost problems. Economic knock-ons: Australia warned Middle East escalation could push global inflation higher as oil buffers thin; India’s growth outlook also faces pressure from higher oil prices and weak investment.

US-Iran De-escalation Watch: Trump says the US and Iran are having “good talks” and there’s a “good chance” of a deal, but strikes will resume if negotiations fail, keeping markets jittery. Saudi Oil Infrastructure Under Fire: Saudi air defences intercepted and destroyed drones launched from Iraq targeting oil facilities in the Eastern Province and Riyadh; Riyadh blames Iran-backed militias, while Iraq orders probes and Gulf states (including Kuwait, Qatar, Jordan, Egypt, UAE) condemn the attacks. Yemen-Houthi Escalation: Houthis claim drone strikes hit Saudi crude supply and transport points feeding Yanbu, framing it as retaliation for Saudi actions over Yemen. Hormuz Shipping Pressure: CENTCOM says it redirected 17 commercial vessels and disabled two under a renewed naval blockade, underscoring how quickly maritime risk can return even during pauses. Iraq Power Crunch & Solar Push: Iraq’s electricity output covers only about one-third of demand; parliament approved reforms, including reopening corruption cases and expanding solar via a soft-loan scheme, while Dana Gas restarts phased production at Khor Mor after security assurances. Regional Energy Routes: Lebanon proposes an Iraq-to-Mediterranean oil transit route to bypass Hormuz, as Iraq seeks alternative pipeline outlets. Market Impact: Oil slid sharply on the pause, with Brent dropping toward the high-$80s, easing supply fears but not ending infrastructure risk. Investment Signals: Brookfield raised about $2bn with Saudi PIF backing for a Middle East private equity fund, despite conflict-driven uncertainty. Supply-Side Outlook: Baker Hughes expects producers to modestly cut 2026 oil and gas spending as firms prioritize existing assets and flexibility.

Oil Market Mood: Brent and WTI slid about 5–6% in early Asia after a second straight night of US-Iran strike pauses, easing fears of a wider Hormuz disruption and lifting risk sentiment. Hormuz Shipping Tension: Iran said six vessels tried an “unauthorized” route south of the Strait of Hormuz and turned back five; the US side kept its blockade posture in place, leaving traders wary that the lull may not restore normal flows. Diplomacy vs Escalation: US envoy Mike Waltz said Trump is giving talks “some room” while keeping “all options” open; Iran signaled it will halt retaliatory attacks if the US pause holds, but the arrangement is not a formal ceasefire. Regional Spillover: Markets also tracked Houthis’ attacks on Saudi oil infrastructure and reports of a tanker mine blast in Hormuz, underscoring how quickly the conflict can widen beyond Iran. Domestic Energy Pressure (Iran): Iran’s fuel situation is tightening, with an exporter union warning of a ~20 million-litre daily gasoline deficit and near-impossible imports. Policy/Business Ripples: Egypt moved to restructure a military-linked economic body into a presidential authority, while markets weighed how lower crude could feed through to inflation and fuel prices.

US-Iran Pause & Hormuz Risk: After 13 nights of strikes, the US paused attacks on Iran and Iran halted retaliatory operations for two nights, giving diplomacy “some space” as Oman-led talks aim to reopen the Strait of Hormuz—though mine fears persist after reports of a tanker explosion following a naval mine hit. Oil Prices & Inflation: The lull eased some pressure, but oil still whipsawed around $100 as markets priced renewed supply-route disruption; gas prices in the US climbed back above $4 a gallon, reviving inflation worries. Maritime Flashpoints Beyond Hormuz: The conflict is spreading to new corridors, with Ukraine accusing Iran-linked cargo activity in the Caspian Sea and Iran warning it won’t go unanswered. Egypt Energy Exports & Renewables: Egypt’s petroleum exports surged to about $2.3bn in H1 as refinery output rose, while Egypt and the UK discussed expanding renewables, grid upgrades, and battery storage. Iran Clean Power Push: Iran inaugurated a 5MW geothermal plant at the Sabalan volcano site, signaling a broader shift to diversify power sources. US War Accounting Scrutiny: The Pentagon moved four US troop deaths from the Iran war tally into a new “Overseas Operations” category, sparking questions over how casualties are counted.

US Naval Blockade: CENTCOM says the US blockade against Iran is still in full effect, redirecting 12 commercial vessels and disabling two non-compliant tankers, including a verification boarding of an oil tanker in the Arabian Sea. Iran Oil Revenue Claims: Iran’s oil ministry says it sold about $18bn in oil during the war and the subsequent ceasefire, claiming the figure covers over 60% of budgeted oil income. US-Iran Strike Pause, Diplomacy Push: After 13 nights of airstrikes, the US paused operations again, citing concerns over Patriot interceptor and air-defense munitions stockpiles and wider escalation risks, while Trump keeps the option of a “much higher level” attack. Hormuz Talks: Iran says it made progress with Oman on Strait of Hormuz shipping mechanisms, focusing on safe passage and sovereignty, after earlier fee-related disputes. Red Sea Energy Risk: With the Hormuz front quieter, Yemen’s Houthis hit Saudi oil facilities near Jizan and Yanbu, raising fears for Red Sea exports and regional spillover. Gas Security Warning: Equinor’s CEO warns Europe may not fill gas storage to 80% before winter due to global supply tightness and LNG competition, with Hormuz disruption worsening the outlook. Iraq Export Glitch: US data shows no Iraqi crude imports for a fourth straight week, underlining how the conflict is reshaping flows. Regional Energy Planning: Cyprus says it aims to become a reliable energy exporter, with gas exports planned via Egypt liquefaction and power links to Greece and Israel.

Red Sea Flashpoint: Egypt and Saudi Arabia urged de-escalation and an end to military operations as Yemen’s Houthis claimed missile and drone attacks on Saudi-linked Aramco facilities in Jizan and Yanbu, while Iran’s Araqchi called for dialogue and said there’s “no military solution” to Yemen. Shipping & Prices: With Hormuz and Bab el-Mandeb under pressure, tankers are rerouting and costs are rising; oil hovered near $100 as markets weighed hopes for US-Iran talks against renewed strikes. Diplomacy Pause: Iran reported a “peaceful night” after a streak of US strikes, and Qatar said maritime navigation would fully resume from Sunday, though fresh incidents kept tensions high. Regional Energy Moves: Kuwait Petroleum Corp signed a $16bn lease-and-leaseback for its crude pipeline network (Project Peregrine) to attract global capital. Egypt’s Supply Security: Egypt said petroleum exports are set to rise, with refinery expansions and a $4.5bn push to cut imports and boost output. Iraq Grid Outlook: Iraq expects electricity gains from deals with Washington and Tehran plus interconnection projects with Saudi Arabia, Jordan, and Turkey.