Energy Emerges As The Latest Market Shock

Wall Street Breakfast 5.74M Followers Subscribe Listen on the go! A daily podcast of Wall Street Breakfast will be available by 8:00 a.m. on Seeking Alpha , iTunes , Spotify . Getty Images Good morning! Here's the latest in trending: It's official: U.S. military confirms for the first time it has weapons in space . Financial fallout: Bank stocks lower after BofA ( BAC ) issues sales and trading guidance. City expansion: Waymo ( GOOGL ) robotaxis are coming to Las Vegas and Tokyo . Buffers run dry More doomsday warnings are being sounded across markets. On Monday, it was AI-driven human extinction . Today, it's an emerging fuel crisis . Don't worry, there will be one tomorrow as well, with turmoil hitting the bond market as the FOMC appears set to hike interest rates for the first time since mid-2023. The 10-year Treasury yield ( US10Y ) has already surpassed the 5% level , shaking investor confidence and rattling Wall Street. Crude watch: Facing a worsening economic blockade, Iran has activated its proxy in Yemen, with the Houthis conducting a lightning blitz to control the entire Red Sea coast and even seizing strategic islands. Control of the territory threatens the key chokepoint of Bab al-Mandab, where 12% of global trade passes through each year. It's also a big slap in the face to Saudi Arabia given a likely maritime blockade of the Kingdom's 750-mile East-West Pipeline, which has been key to oil circumventing the Strait of Hormuz. To make matters worse, the key pipeline came under drone attacks , taking off 4% of global supply and fueling a further fuel crunch. Just 5-7 days of oil left to export The news sent Brent crude ( CO1:COM ) above $108/bbl, while WTI futures ( CL1:COM ) soared past $103/bbl, trading at levels last seen back in May. Concerned about spiraling energy prices, President Trump turned to Ukraine to stop attacking Russian diesel infrastructure , although neither country has independently confirmed they are holding to such an arrangement. Moscow has been forced to ration fuel domestically and ban diesel exports, and when combined with international shipping disruptions, it can put severe upward pressure on global markets. Next red flag: Commercial fuel stocks around the world have been depleting for more than six months, and necessary oil reserves, like the U.S. Strategic Petroleum Reserve, cannot be tapped much further. "All these mechanisms helped to mitigate the price and supply risk - those have largely now played out, and we don't have nearly the buffers in the system that we did when [the Middle East war] began," Chevron ( CVX ) CEO Mike Wirth declared. "It's harder to envision a scenario where prices soften and quickly. I think the risks remain to the upside over the next few months." ( 102 comments ) Here's the latest Seeking Alpha analysis Before AI Destroys The World, I'd First Invest In These Bottlenecks AI Is Going Rogue: 3 Stocks I'm Buying 2 High-Yielders That Are Growing Their Portfolios AI Apocalypse Narrative Is A Sales Pitch Top 50 High-Quality Dividend Growth Stocks For September What else is happening... WSB survey results: The driver behind AI apocalypse warnings . EPA to roll back Biden-era limits on power plant emissions . Costco ( COST ) hikes motor oil prices and limits purchases . Trimming the fat? Novo Nordisk ( NVO ) shortens name to 'Novo.' Verizon ( VZ ), T-Mobile ( TMUS ) end legal fight over ad campaigns . Iran war cost: $33.4B in four months and U.S. munitions shortfalls . Apple ( AAPL ) releases Siri AI with greater cross-app functionality . Paramount exit could cost California billions of dollars - LA study . Oprah Winfrey is bringing a music, arts show to Sphere Las Vegas . SA Asks: How can U.S. government realistically regulate AI safety? Today's Markets In Asia, Japan flat. Hong Kong -1% . China -0.5% . India -1% . In Europe, at midday, London -0.3% . Paris -0.3% . Frankfurt -0.1% . Futures at 6:30, Dow -0.5% . S&P -0.3% . Nasdaq -0.3% . Crude +2.2% to $103.59. Gold -0.9% to $4,311.90. Bitcoin -1.3% to $76,929. Ten-year Treasury Yi eld +2 bps to 5.01%. On The Calendar Companies reporting today include Trip.com ( TCOM ). See the full earnings calendar on Seeking Alpha, as well as today's economic calendar . This article was written by Wall Street Breakfast 5.74M Followers Subscribe Wall Street Breakfast, Seeking Alpha's flagship daily business newsletter, is a one-page summary that gives you a rapid overview of the day's key financial news. It is designed for easy readability on the site or by email (including mobile devices) and is published before 7:30 AM ET every market day. Wall Street Breakfast's readership of more than 1 million subscribers includes many from the investment banking and fund management industries. Sign up here to receive the Wall Street Breakfast in your inbox every business day.