THE US EXITS IRAQ. AFTER 23 YEARS, THE LAST TROOPS ARE GONE.

• The Qatari mediation channel is active but the gap remains wide. Araghchi met Qatari mediators in New York on Sunday and said he hoped for a US response by Tuesday 7AJE Iran’s Araghchi meets Qatari mediators as US calls for nuclear talks. He has now returned to Tehran. A US official confirmed to both Al Jazeera and the Jerusalem Post that talks are "positive and constructive" but that nuclear issues must be part of any deal, while Iran insists Hormuz conditions come first and dismisses reports of any flexibility in its position 3TSN Hormuz Reopening Tied to Conditions: Iran’s Araqchi8JPO Trump willing to bend on Iran sanctions if progress made on nuclear issues, official tells ‘Post'. The sequencing dispute, who moves first, is not a technicality. It is the whole disagreement. Both sides have strong domestic reasons not to be seen conceding the opening move.

• Iran's domestic economy is visibly collapsing under the weight of the blockade. Reuters reporting from inside Iran describes engineers priced out of Tehran by rent, patients unable to afford medication, a restaurant owner who cannot raise prices because his customers cannot pay more, and a black market that has become more expensive and more pervasive simultaneously 2JPO Iranians stagger under soaring cost of living after seven months of war with the US. Iranian officials have suppressed protests, including killing thousands of demonstrators in January before the war even began 2JPO Iranians stagger under soaring cost of living after seven months of war with the US. The economic pressure is real. Whether it translates into diplomatic flexibility or domestic instability, or both, is the open question. The Reuters sources say most Iranians are now too consumed by daily survival to think about protesting.

• A US Senate report identifies Tether's USDT stablecoin as Iran's shadow banking system. Led by Senator Richard Blumenthal, the report analysed 846 crypto wallets sanctioned by the US and Israel in connection with Iran and found that 84 percent transacted in Tether's USDT 1JPO Iran's Islamic regime using Tether cryptocurrency as 'financial lifeline,' US Senate report charges. The report says Tether has become "central to Iran's shadow banking system," allowing the Iranian government to fund Hezbollah and move money across its borders despite sanctions. Tether says it froze nearly $550 million in Iran-linked USDT this year and denies being a sanctions haven 1JPO Iran's Islamic regime using Tether cryptocurrency as 'financial lifeline,' US Senate report charges. The significance here is not just Iran. If a stablecoin can sustain a country's shadow banking under the most aggressive US sanctions regime in decades, that is a structural problem for the entire economic warfare toolkit.

• The UAE's "Hormuz Shuttle" is now running 116 hulls and exporting meaningful volumes of Gulf oil. Swiss energy analyst Alexander Stahel's detailed assessment, cited by Fox News, describes a system where very large crude carriers owned and operated by Abu Dhabi National Oil Company (ADNOC) shuttle oil through the Oman Lane hugging the Omani coast, conduct ship-to-ship transfers in the Gulf of Oman, and then re-enter the Gulf 6FOX MORNING GLORY: President Trump and the American military have beaten Iran. Saudi Aramco and Kuwait have copied the model. Qatar and Iraq are also using it. Brent is at $97 and WTI at $90, both meaningfully lower than the $107-108 spike earlier this week when Trump rejected Iran's proposal 6FOX MORNING GLORY: President Trump and the American military have beaten Iran. Iran's foreign minister Araghchi insists the Hormuz conditions must be met for the strait to reopen, which implicitly acknowledges the shuttle is partially working around his leverage 3TSN Hormuz Reopening Tied to Conditions: Iran’s Araqchi.

• Iraq has lost $60 billion in oil revenues since the war began and has no good alternative export route. Iraq's prime minister told the UN General Assembly that 90 percent of sea-based oil exports have been cut off 14AJE Iraq looks for oil export alternatives to the troubled Strait of Hormuz. The Iraq-Turkiye Pipeline (ITP) and proposed Jordan and Syria routes are all either insufficient or impractical in the near term, analysts told Al Jazeera 14AJE Iraq looks for oil export alternatives to the troubled Strait of Hormuz. Iraq's federal budget is 90 percent dependent on oil revenue. Salary payments are already being affected and protests have hit Baghdad 14AJE Iraq looks for oil export alternatives to the troubled Strait of Hormuz. Iraq is the war's most economically damaged bystander, and its government has just asked the US to leave.

Oil has pulled back sharply from Sunday's spike. Brent is at $97, WTI at $90, both down from the $107-108 levels driven by Trump's public rejection of the Iranian proposal 6FOX MORNING GLORY: President Trump and the American military have beaten Iran. That retreat is the Hormuz Shuttle doing its work: the market is revising downward its estimate of how much the strait closure actually bites now that 116 hulls are running alternative routes. The Oil Volatility Index (OVX) at 54.86 remains elevated, so the market is not relaxed, but the direction of travel on price is downward. The number that deserves attention is the US 10-year Treasury yield at 5.285 percent, its highest point in this data set, up from 4.72 just a month ago. The war's fiscal cost is now structurally embedded in America's borrowing rate. Frontline, the tanker operator, has climbed from $44 in August to $49.27 today: someone continues to profit from the disruption. Defence stocks are drifting lower across the board, consistent with a market pricing prolonged stalemate, not a new escalation.

The Fairford investigation is now into its third day with no charges and no confirmed Iran link. The five British nationals remain on bail with stringent movement conditions 4BBC RAF Fairford incident involves 'foreign actor', says Rubio. US Secretary of State Marco Rubio says a "foreign actor" is clearly involved and pointed explicitly at Iran 4BBC RAF Fairford incident involves 'foreign actor', says Rubio. UK Prime Minister Andy Burnham chaired a Cobra (Cabinet Office Briefing Rooms) emergency committee meeting and urged restraint on speculation 4BBC RAF Fairford incident involves 'foreign actor', says Rubio. The gap between what Rubio is saying publicly and what British counterterrorism police have actually found is, at this point, significant. The Guardian's reporting notes that after more than 24 hours of searches, nothing was discovered to prompt further police action, and the arrests were not intelligence-led but triggered by a local farmer calling 999 9GDN Questions remain over Iran’s link to alleged RAF Fairford bomb plot. Trump claimed the men had been monitored for "a long time." UK sources say the elevated threat level at Fairford was related to general concerns about US bases, not this specific group 9GDN Questions remain over Iran’s link to alleged RAF Fairford bomb plot. Both governments are now managing a political narrative about Iran-linked domestic terror that may be running ahead of the evidence. Watch carefully.