Iran Status Update
Tehran is sustaining pressure on the Strait of Hormuz to keep energy prices elevated while deliberately keeping the conflict below the threshold of full-scale war. Iranian hardliners see rising US inflation and the Fed’s recent rate hike as evidence that their strategy is increasing pressure on Washington, but Iran’s growing economic isolation—including tighter Turkish trade controls and Pakistan’s border closure—could make the stalemate difficult to sustain.
Beijing is also introducing a new layer to the confrontation, with Tehran concerned that China could use its leverage over Iranian oil purchases to pressure a reopening of Hormuz in exchange for Washington walking back a proposed $14 billion arms package to Taiwan.
Meanwhile, the Houthis have privately assured both the US and Israel that their vessels will be spared in the Bab el-Mandeb—provided neither joins Saudi Arabia’s efforts to retaliate after a series of crippling Houthi strikes on key Saudi targets.
Emerging World (Dis)Order
Most polls have Brazilian incumbent Lula da Silva virtually tied with Flávio Bolsonaro in a high-stakes election on October 4th that could determine whether Latin America’s largest economy maintains its current course of strategic autonomy or becomes the latest major country to shift right and align more closely with a Trump-aligned regional order. For now, however, the campaign is being fought as much over the candidates’ domestic records as over their competing visions for Brazil’s place in the world.
Flávio Bolsonaro enters the final stretch of the campaign under investigation in connection with the Banco Master scandal. At the center of the investigation is roughly $12 million transferred in 2025 from Daniel Vorcaro—the bank’s former owner—to a US-based fund linked to Flávio’s brother, Eduardo Bolsonaro, who was financing a film about their father, former president Jair Bolsonaro. Investigators are examining whether the money was improperly obtained or moved through the film project, while the Bolsonaro brothers say the transfers were legitimate and related to the film.
The scandal also engulfed the Supreme Court itself, where Justice Alexandre de Moraes—one of Jair Bolsonaro’s chief political enemies—is facing allegations arising from Banco Master. Police reports allege Moraes also communicated with Mr. Vorcaro and may have intervened on his behalf as authorities investigated the bank. Authorities also flagged a roughly $25 million contract between Banco Master and the law firm owned by Moraes’ wife, including evidence that Moraes himself edited the agreement. The court is now considering whether to authorize an investigation into one of its own justices.
Brazil’s deeply polarized society now faces an election defined by institutional conflict, with the candidates’ competing policy agendas often relegated to the background. As the economy slows, job creation remains subdued, and GDP growth loses momentum, polls suggest corruption, influence peddling, and Brazil’s relationship with the US have emerged as the decisive issues of the campaign. But with scandals affecting all sides, it remains unclear how these forces will ultimately shape voters’ choices.
Weekly Wildcard
Washington’s investment in Elmet Group gives the US tungsten producer and processor the capital and government backing to expand a strategically important domestic supply chain. This week, the Department of War announced a $450 million preferred-equity investment in Elmet, alongside warrants for up to 19.9% of its common stock and a seat on the company’s board. The US government is now simultaneously an investor, financier, and customer in the same critical-mineral supply chain. The arrangement strengthens Elmet’s financial position as Washington seeks to establish a sustained source of tungsten outside China.
Much of the planned investment will go toward existing facilities in the Springer complex in Nevada, but the critical new capacity remains several years away. China produces roughly 79% of the world’s mined tungsten and controls about 85% of global refining, while Beijing has restricted exports of the mineral—essential for defense manufacturing and technology—through a licensing system covering just 15 firms. Prices have climbed sharply, creating a strong economic incentive for new production, but the financing, permitting, and processing technology remain significant barriers to bringing new supply online.
Washington’s push for alternative tungsten supply raises questions about whether new sources can meet increasingly demanding standards for traceability of raw materials. US-based tungsten producer Almonty Industries also signed a joint venture with Rwanda this week in an operation that will source ore, pre-concentrates, and tailing from Rwandan license holders, including small-scale miners, for export and processing.
The timing is notable because new US defense procurement rules taking effect in January 2027 will impose stricter traceability requirements on tungsten entering certain military supply chains, potentially increasing the need to verify the origin of the sourced material amid allegations of minerals moving from eastern DRC into Rwanda for export.
