Good morning. Oil traders see it as a worst-case scenario. Pentagon officials have long warned against it. Vice President JD Vance believes it would be suicidal.

Yet Iranian lawmakers on Sunday reportedly threatened a closure of the Strait of Hormuz, a strip of water connecting the energy rich Persian Gulf to global markets, after the U.S. joined Israeli strikes on Tehran’s nuclear facilities. That rattled oil markets and sent U.S. stock futures lower on Sunday evening.

• Petroleum corridor: Roughly 20% of the world’s petroleum passes through the 20-mile-wide strait, where dozens of skyscraper-size tankers each day funnel into a pair of 2-mile-wide traffic lanes separated by a 2-mile-wide buffer. The transit through that 6-mile strip within the strait includes a similarly huge share of the world’s liquefied natural gas.
   
• Critical supply route: Crucial for cars, chemical makers and power plants around the world, the supplies help fuel the oil-hungry Chinese economy and dictate prices paid by U.S. drivers and air travelers. Iran has often harassed foreign-flagged tankers in the area and occasionally threatened to disrupt that trade more broadly in times of stress, a move that could upend financial markets and send global energy costs soaring.
   
• Still unlikely? Many oil traders and energy executives still view the scenario as a scorched-earth tactic and distant possibility. Tanker-tracking firms said Sunday that traffic through the strait was proceeding as usual.
   

More reading:

• Trump Says It Is Time for Peace With Iran. It May Not Be Up to Him.
• Trump’s Iran Attack Revives Questions About War Powers
• A Cornered Iran Gives Few Clues on Response to Bombings
• Israel Seeks to Wrap Up Conflict With Iran Soon

State attorneys general take on greater enforcement role.

State attorneys general are increasingly the new cops on the beat in an age of deregulation under the Trump administration.

The top state law enforcement authorities are often coordinating across borders and party lines to tackle emerging issues, attorneys general and former prosecutors said. Facing a dismantling of federal regulatory agencies and the roll back of federal enforcement, attorneys general of Democrat and Republican-led states are taking on bigger roles on issues such as consumer protection, privacy and antibribery enforcement.

U.S. prepares action targeting allies’ chip plants in China.

A U.S. official told top global semiconductor makers he wanted to revoke waivers they have used to access American technology in China, people familiar with the matter said, a move that could inflame trade tensions.

Currently, South Korea’s Samsung Electronics and SK Hynix as well as Taiwan Semiconductor Manufacturing enjoy blanket waivers that allow them to ship American chip-making equipment to their factories in China without applying for a separate license each time.

Jeffrey Kessler, head of the Commerce Department unit in charge of export controls, told three companies this week he wanted to cancel those waivers, according to people familiar with the meetings. They said Kessler described the action as part of the Trump administration’s crackdown on critical U.S. technology going to China.

• Before the strike over the weekend, the U.S. targeted Iran with new sanctions, including the largest ever set of sanctions aimed at Yemen’s Houthi rebels.
   
• A toy maker sued Trump over tariffs and won. But its operations are still in tatters.
   
• The U.S. Treasury sanctioned five senior figures of Mexico’s Jalisco cartel as it cited the group’s effective control over the Port of Manzanillo, a deep-water facility on Mexico’s Pacific coast that is undergoing a multibillion-dollar expansion to become Latin America’s busiest seaport.
   
• Republican lawmakers’ proposal to fold the U.S. audit watchdog into the Securities and Exchange Commission hit a roadblock when the Senate parliamentarian determined that including the provision in a broader tax bill violates rules around budget reconciliation.

U.S., EU near deal on nontariff trade irritants.

The U.S. and European Union appear to be nearing a deal on multiple nontariff trade issues from deforestation rules to the treatment of U.S. tech companies in Europe—but the fate of looming tariffs set to be imposed by each trading partner remains unclear.

A draft “agreement on reciprocal trade” circulated by the U.S. Trade Representative’s office lays out tentative deals on a litany of specific trade issues, including the EU’s Digital Markets Act, its carbon-based border tariffs, shipbuilding and more, according to people with knowledge of the text, who said the agreement appeared to be close to final but emphasized it could change in the coming days and weeks.

• Arab Gulf states are calling on the U.S. to rein in Israel amid the attacks on Iran’s nuclear program and calls by some in the Israeli government for regime change in Tehran.
   
• Wars in Ukraine and Iran, and rising doubts about the reliability of the U.S., are making countries around the world wonder if having their own nukes is the key to survival.
   
• Aflac has been hit with a cyberattack that may have resulted in the theft of personal data related to the insurer’s U.S. business.
   
• Business activity in Europe and some large economies in Asia continued to grow this month despite continued uncertainty about global trade policy and the threat of higher energy prices as conflict in the Middle East intensifies.

• Because of a quirk of the cybersecurity industry, the world’s most dangerous hackers are getting increasingly cartoonish code names. Laundry Bear joined a team of supervillains that also included Vengeful Kitten, Lucky Mouse and Chatty Spider. Some security chiefs have had enough
   
• Details of the wedding of Jeff Bezos and Lauren Sánchez are a tightly kept secret. That isn’t stopping some angry Venetians, armed with buoys and motorboats, from plotting to disrupt it.
   
• Ordinary investors are souring on big tech.
   
• Republicans’ tax legislation aims to curtail a popular route for business owners to dodge the cap on the state and local tax deduction, spurring last-ditch attempts by accountants, dentists and business groups to get the GOP to back off.

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