US Strikes Iranian Targets as Tehran Closes Hormuz Strait to Commercial Traffic

US missiles struck targets across Iran on July 25, 2026, following Trump's pledge of 'major military punishment,' while Iran simultaneously closed the Hormuz Strait — through which approximately 21 million barrels of seaborne crude transit daily. The strike represents the first confirmed direct US military action on Iranian soil in this escalation cycle, triggering Brent crude's 9.9% weekly surge to $96.78 while the VIX sits at 18.58 — a notable divergence signaling that institutional hedging has not yet caught up to the geopolitical reality. The non-obvious angle: Trump simultaneously left 'the door open' to a diplomatic deal with Iran, and Dawn Pakistan reports exploratory US-Iran talks held during the Iranian interior minister's Islamabad visit with China as a facilitating broker — a back-channel the equity market is not pricing. Whether that channel holds or collapses in the next 48 hours is the single variable that determines whether Brent trades toward $120 or retraces 15%. Full causal chain analysis in this week's briefing.