ISRAEL TRIED TO KILL IRAN'S NEGOTIATORS MID-FLIGHT. THE US TIPPED TEHRAN OFF.

• Iran and Oman have formally agreed to jointly manage and regulate Strait of Hormuz traffic, with Ghalibaf announcing the deal during a meeting with Chinese officials in Tehran 7CRD Iran announces deal with Oman to 'manage' Strait of Hormuz traffic. He was explicit: "We will not allow the United States to interfere in the strait." This is not a new Iranian position, but it is the first time a bilateral management framework with a specific Gulf partner has been announced publicly. The MoU's Article Five is the legal basis. Oman's role as the trusted neutral in this war, mediating between Washington and Tehran throughout, makes it the obvious partner. The US is now formally on the outside of the governance structure for the world's most strategically critical waterway. CENTCOM held a security dialogue in Bahrain this week expressing commitment to "free flow of commerce" in the strait 10AJE Iran warns ships against using unapproved routes in Strait of Hormuz. Iran's deputy foreign minister responded that CENTCOM "cannot establish legal order and security for the Persian Gulf" 10AJE Iran warns ships against using unapproved routes in Strait of Hormuz. These two positions are not compatible.

• Iran's military command has formally threatened vessels that deviate from Iran-designated routes in the Strait of Hormuz with an "immediate and forceful response" 10AJE Iran warns ships against using unapproved routes in Strait of Hormuz. At least 49 vessel incidents have been recorded in the strait since February 28, and ships are still lining up offshore waiting for Iranian clearance. Two vessels seized by the Islamic Revolutionary Guard Corps (IRGC) in April, the MSC Francesca and the Epaminondas, remain in Iranian custody despite the ceasefire 12BBC On the Strait of Hormuz, BBC finds seized ships and shark fishermen as uneasy calm returns. The BBC, reporting from Bandar Abbas, the first international journalists on the Iranian side since the war began, found a port cautiously returning to life, but with the two seized ships visible from the water and dozens of cargo vessels anchored offshore waiting for permission to move 12BBC On the Strait of Hormuz, BBC finds seized ships and shark fishermen as uneasy calm returns. "Uneasy calm" is the right phrase. It is not resolution.

• The Government Accountability Office (GAO) published a damning assessment of the Pentagon's weapons replenishment capacity, finding that average delivery timelines have stretched to over 12 years and that several major programmes have been placed on the GAO's "High Risk List" 3CRD Pentagon ‘struggling’ to replenish dwindling stockpiles after costly war on Iran: Report. This lands two weeks after the Pentagon awarded Lockheed Martin a seven-year, $35-billion contract to restock Terminal High Altitude Area Defense (THAAD) interceptors burned through during the war. The Center for Strategic and International Studies assessed that depleted US stockpiles have created a "window of vulnerability" for a potential Western Pacific conflict 3CRD Pentagon ‘struggling’ to replenish dwindling stockpiles after costly war on Iran: Report. The 40-day Iran campaign cost more hardware than the replenishment industrial base can replace quickly. That is a strategic liability that has nothing to do with Iran and everything to do with what happens if China looks at that window.

• Kurdish fighters clashed with IRGC forces in northwest Iran, with the Democratic Party of Iranian Kurdistan (PDKI) saying six of its Peshmerga were killed in an IRGC ambush near Piranshahr in West Azerbaijan Province 14FOX Six Kurdish fighters killed in IRGC ambush as clashes spread across western Iran. Iran's state media put the number at five. The PDKI says the unit was on a "political and organisational mission" when it was ambushed by a "large and heavily equipped IRGC force." The organisation's US representative told Fox News this is "not business as usual" and described operations running "deep inside" Iranian territory 14FOX Six Kurdish fighters killed in IRGC ambush as clashes spread across western Iran. The Kurdistan region has absorbed more than 850 Iranian attacks since February. The IRGC is not waiting for the diplomacy to resolve before suppressing internal pressure points. This is a conflict-within-the-conflict that barely makes Western headlines.

• Israel's strikes on Lebanon are continuing despite the June 26 framework agreement, with the Israel Defense Forces (IDF) hitting 10 Hezbollah sites in southern Lebanon after a soldier was seriously wounded in Bint Jbeil 2TOI IDF shells Hezbollah sites after soldier hurt in clash with gunman in south Lebanon5AAM Israeli drone strikes injure 2 in southern Lebanon despite framework agreement. Lebanon describes the strikes as ceasefire violations. Israel describes them as responses to Hezbollah violations. More than 640,000 displaced Lebanese have returned home, which is the good news buried in a story that is otherwise about a framework agreement fraying before it has been implemented 2TOI IDF shells Hezbollah sites after soldier hurt in clash with gunman in south Lebanon.

Gold at $4,187 is up nearly $100 from a month ago. Oil is sitting below $72. The Gold/Oil ratio has now reached 60.88, its highest point in this entire conflict, and it is telling you something important: commodity traders who hedge macro risk are pricing in sustained instability even as crude prices something closer to resolution [[market data]].

European defence stocks are worth noting. BAE Systems is up nearly 10% over the past month. Rheinmetall is up roughly 15.5% over the same period. Both are near conflict-period highs. Markets have fully priced in a multi-year rearmament supercycle, and the GAO report on US stockpile depletion 3CRD Pentagon ‘struggling’ to replenish dwindling stockpiles after costly war on Iran: Report is the fundamental case for why European defence budgets are not coming down regardless of what happens in Vienna or Doha.

The VIX at 15.81 is low, which means US equity markets are not pricing in acute near-term risk. Whether that reads as confidence or complacency depends on whether you think the funeral week passes without incident.

The BBC's Bandar Abbas report is the clearest window yet into why Western energy consumers are not out of the woods 12BBC On the Strait of Hormuz, BBC finds seized ships and shark fishermen as uneasy calm returns. Ships are moving through Hormuz again, but they are doing so with Iranian permission, on Iranian-preferred routes, under threat of "forceful response" if they deviate. That is not a normalised shipping lane. It is a toll road with an armed gatekeeper who just formalised a joint management deal with Oman and told the US it has no role. Any political or military event that disrupts that arrangement, another Israeli strike on Iran, another IRGC boarding of a non-compliant vessel, a US escort operation, snaps the partial recovery and sends Brent back toward the $90s.

For the moment, pump prices are falling with Brent below $72. Enjoy it cautiously.