The U.S. launched a second round of airstrikes on targets in multiple Iranian cities on Thursday, and Iran retaliated by firing on U.S. military bases in Kuwait, Bahrain and Jordan, while stating the Strait of Hormuz would remain closed to all types of vessels. President Trump told reporters in the Oval Office, “We hit them hard yesterday and we’re going to hit them hard again today.”
The EIA reported U.S. crude and product inventories declined 13.54Mb last week (or 1.93Mbpd). Over the past 5, 10 and 20 weeks, inventories have fallen by 74.1Mb, 128.7Mb and 162.2Mb respectively. U.S. inventories now total 1.559Bb (lowest since Apr. ’04) approaching levels of problematic operational integrity. Total production was 13.8Mbpd, up 2.8% y/y but down an annualized 0.8% over past 6 months.
Bloomberg reports French state-owned utility EDF and U.K.-based Centrica plan to invest $1.07B to extend the lifespan of Britain’s 1.2GW Sizewell B nuclear power station from 2035 to 2055. The companies are nearing a “heads of terms” agreement with the Department for Energy Security and Net Zero, with final announcement expected within weeks.
AI watch: Oracle shares declined as much as 11% in early Thursday trading after reporting (higher than expected) capex $16.5B in the May quarter, bringing the annual total to $55.7B (vs. $50B est.). Oracle CFO Hilary Maxson forecast fiscal ’27 (May) capex of $95B (incl. $20B-$25B of “prepayment for some components” expected to be repaid). In fiscal ’26, ORCL raised $48B in equity and debt financing and plans to raise another $40B in fiscal ’27. Separately, the Wall Street Journal reports Open AI is considering “drastically” reducing the prices it charges users for tokens as it seeks to win customers from Anthropic. Stay tuned…
Euro Stoxx 50 +0.7%, S&P futures +0.75 and Nasdaq futures +1.2%. European bonds trading higher, with yields down 2bps-4bps across the board. 10-year Treasury yield -3.2bps (4.520%). DXY dollar index +0.1%, spot gold +0.3% and spot silver +0.4%. U.S. PPI @ 8:30 am (est. +0.7% m/m & +6.4% y/y).
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