Good morning! Today is Friday, June 12th 2026, and this is The American Conservative's Morning Brief. As the Iran war grinds into its 104th day with overnight U.S. strikes, retaliatory Iranian attacks on Gulf bases, and a whiplash announcement of a phantom peace framework, Josh Paul argues Trump holds a far stronger hand against Netanyahu than Washington seems to realize. Wholesale prices posted their largest annual jump since 2022, driven by a war-fueled surge in gasoline, as the European Central Bank hikes rates and the Federal Reserve faces a painful choice next week. In London, the resignations of Defense Secretary John Healey and his deputy over a gutted defense plan have detonated inside Keir Starmer's cabinet, inviting comparisons to the collapse of Boris Johnson's government. and now for the details. We begin with the Iran war, now in its one hundred and fourth day. Overnight, the United States bombed Iran for the second consecutive evening, with Central Command saying the strikes targeted Iranian military surveillance, communications, and air defense sites. Iran retaliated with two waves of attacks on U.S. bases in Kuwait and Bahrain. Tehran also reported that earlier U.S. strikes destroyed two reservoirs in Hormozgan province, leaving twenty thousand residents without drinking water in extreme heat. India's foreign ministry says a third Indian-crewed oil tanker was struck by the U.S. Navy this week, with three Indian sailors reported killed. As Harrison Berger reports, President Trump declared on Truth Social that the United States will, quote, "be taking Kharg Island, and other oil infrastructure points," and assume total control of Iran's oil and gas markets, comparing the plan to Venezuela. He also vowed to bomb Iran, quote, "very hard tonight." Then, in a sudden reversal Thursday afternoon, Trump announced he had cancelled those planned strikes, claiming a framework to end the war had been approved at the highest level of Iranian leadership, and naming Israel, Saudi Arabia, the UAE, Qatar, Turkey, Pakistan, and others as parties. Both Iran and Israel denied any such agreement exists. Brent crude rose to ninety-three dollars and fifty cents a barrel, and AAA pegged the national average price of regular gasoline at four dollars and thirteen cents. Against that backdrop, Josh Paul argues in The American Conservative that despite the conventional wisdom, it is President Trump, not Prime Minister Netanyahu, who holds the stronger hand. Paul notes that American support for Israel is cratering in public opinion, even as Congress is fast-tracking legislation that would give Israel enduring access to America's most sensitive technologies and intelligence, in exchange, he writes, for little more than a thank-you note. Netanyahu, Paul contends, is actually in a weak position. He faces elections this fall, he needs a visible win in Iran that looks increasingly out of reach, and he needs to lock in the U.S. legislative framework before a new Congress is seated in January. Paul urges the administration to link the three tracks of the relationship together: the Iran war, Palestinian self-determination, and the future of U.S.-Israel security cooperation. He recommends that Trump work with Republican leadership to slow-roll the pending legislation, so Netanyahu cannot present it as a sure thing before Israeli voters go to the polls. In Paul's reading, Netanyahu needs Trump far more than Trump needs Netanyahu, and there is no reason to give away the game just as the cards have been dealt. The war's economic costs are landing on American families. Joseph Addington reports that the Producer Price Index for final demand rose one-point-one percent in May, pushing the annual increase to six-and-a-half percent, the largest twelve-month jump since November 2022. The figure significantly topped economists' expectations. Addington writes that the surge was driven by energy costs tied to the war in Iran and the closure of the Strait of Hormuz. More than half of May's advance came from a twenty-three-point-four percent increase in the gasoline index, with knock-on effects in plastics, industrial chemicals, fertilizer, diesel, and jet fuel. The continued climb in wholesale prices suggests headline inflation will remain elevated, complicating the Federal Reserve's decision next week on interest rates. President Trump has called for rate cuts, but, as Addington notes, that is a difficult move for the central bank in an inflationary environment. Across the Atlantic, David Brady reports that the European Central Bank has already moved, raising rates Thursday from two to two-and-a-quarter percent, the first major central bank to hike amidst the war-driven price surge. Economists expect the Federal Reserve and the Bank of England to follow before year's end. Those are today's highlights. For the full stories and more, visit theamericanconservative.com. Thank you for starting your morning with us.
