Good morning. The U.S. hit two oil tankers and their owners with blocking sanctions and said they had carried Russian oil above the West’s price cap of $60 a barrel, the first time the Biden administration has punished market participants for violating the rules.

• Sanctioned ships: The Treasury Department said it was targeting one ship with a registered owner in the United Arab Emirates and one with a registered owner in Turkey. Both ships carried Russian oil above $60 a barrel while using U.S. maritime services, according to the Treasury. The new sanctions prohibit all U.S. people and entities from transacting with the ships and their owners.
   
• Crackdown: Some traders and analysts had started to believe that the U.S. wouldn’t harshly enforce the sanctions to avoid upsetting oil markets. Treasury Secretary Janet Yellen told The Wall Street Journal this week that the U.S. would likely move to crack down on evasion.
   
• Inflation balancing act: The measures announced Thursday were limited in scope. The risk for U.S. officials with the enforcement push is that Western firms involved in the Russian oil trade could pull back further—potentially leaving Russian oil without a path to global markets. That could squeeze global supplies and raise oil prices, feeding inflation.

U.S. to hold off on disbursing $6 billion in Iran oil revenue unfrozen in prisoner deal.

The U.S. and Qatar have agreed to deny Iran access to $6 billion in oil proceeds that Washington had previously freed up as part of a prisoner swap reached last month, according to people familiar with the matter.

The decision with Qatar, whose government is overseeing Iran’s access to the funds, comes amid concern for Tehran’s long-running provision of money, arms and intelligence to the group responsible for the terrorist attack on Israel last weekend, Hamas.

Couple alleges parental leave policy at law firm Jones Day discriminates against fathers.

After Julia Sheketoff completed a clerkship at the Supreme Court in 2014, she accepted a position at law firm Jones Day, drawn by a decent work-life balance, rewarding cases and competitive pay on top of a six-figure signing bonus. Her husband Mark Savignac, also a law clerk she met at the high court, joined a few years later.

When they were expecting their first child, Savignac told the firm he intended to be the primary caregiver and wanted 18 weeks off, the amount of paid time it granted to new mothers. The firm allowed men who take the primary role 10 weeks of parental leave.

The couple has sued the firm, alleging the policy violates federal civil-rights law. The firm says mothers sensibly get more time to recover from childbirth. Savignac also says he was fired for demanding equal treatment, a claim the firm vigorously denies.

• More than three dozen Filipino construction workers who helped build the multibillion-dollar stadiums hosting last year’s World Cup in Qatar have sued the U.S.-based company that oversaw their construction, alleging it violated human trafficking laws and knowingly participated in an exploitative venture.
   
• Caroline Ellison hasn’t spoken with her former boss and ex-boyfriend Sam Bankman-Fried since the collapse of his crypto empire last November, she told jurors at Bankman-Fried's trial. Ellison's testimony wrapped up Thursday.
   
• Lawsuits challenging diversity efforts are taking aim at funding for small businesses, prompting some behind the funding programs to re-evaluate criteria.
   
• TikTok tried to persuade a federal judge on Thursday to block Montana’s ban of the social-media app.
   
• U.S. health officials on Thursday banned the sale of Vuse Alto menthol e-cigarettes, which have surpassed Juul as the top-selling vaping products in the country amid a regulatory crackdown on the industry.
   
• A whistleblower who aided the Commodity Futures Trading Commission and another regulator in their enforcement efforts has received an $18 million award, the CFTC said. Following its normal practice, the CFTC didn’t provide details about the action underlying the whistleblower award.
   
• An Internal Revenue Service contractor pleaded guilty to leaking the tax returns of former President Donald Trump and thousands of wealthy Americans, in a case that has resolved a two-year mystery over a security breach that drew outcry from lawmakers and other government officials.
   
• Microsoft’s acquisition of videogame company Activision Blizzard won approval from U.K. competition authorities, clearing a path for them to close the $75 billion deal after a lengthy struggle with regulators.

Hamas invasion rewrites rules in Middle East.

Saturday’s attack on Israel by Hamas militants, who killed more than 1,200 people and kidnapped many others back to the Gaza Strip, has upended fundamental assumptions about the Middle East.

Now, as Israel, its enemies and its main partner, the U.S., respond to these shocking events, the new—and untested—rules of the game risk turning the bloody confrontation between Israel and Hamas into a much wider war.

Israel’s expected land operation against Hamas in Gaza, and the reaction to it by Iran and its group of allied Islamist militias around the region, could determine the new balance of power in the Middle East and the new set of understandings about the region’s future.

• Israel Tells 1.1 Million Civilians to Evacuate Northern Gaza
• U.N. Urges Israel to Rescind Gaza Evacuation Order
• At Israel-Lebanon Border, Fears Grow of a Second Front
• For Palestinians Trapped in Gaza, There Is No Way Out
• The Gaza Strip: What To Know, Maps and History

This inflation report won’t let the Fed declare victory.

Recent progress bringing inflation down stalled in September, offering the latest sign that the path to fully extinguishing price pressures remains bumpy.

The good news: Price gains have slowed markedly from the 40-year highs recorded last year, particularly when looking at a gauge of underlying, or “core,” inflation that excludes volatile food and energy prices.

• American households and businesses have been resilient in the era of high interest rates. Big-bank earnings may show whether they are starting to crack.
   
• Lackluster inflation and declining trade numbers in China have stoked concerns that the world’s second-largest economy is still on shaky footing, despite recent signs of stabilization.
   
• After a decade of kicking the can down the road, China’s local government debt problem has become impossible to ignore.
   
• Alongside Ukraine’s assault on Russian front lines, the country is conducting a second—and potentially more critical—campaign: destroying enemy command centers, ammunition depots and logistics lines that Moscow relies on to keep fighting.

• Israel’s large cybersecurity base is mobilizing to protect the country’s digital borders from hackers in the wake of last weekend’s deadly cross-border attack.
   
• Members of Israel’s technology sector are reeling from the unfolding war, while trying to keep their businesses going as executives and employees join the fight.
   
• Opioid manufacturer Mallinckrodt received court approval for a plan that wipes out more than $1 billion of payments meant for addicts while handing control of the company to its lenders.
   
• Attracting compliance workers is harder than ever for crypto firms—just when the industry needs them the most.

• The pool of U.S. students who completed accounting degrees dropped sharply in the latest available academic year as more workers in the profession retire without an adequate pipeline of entrants to fill the gap.
   
• The war that broke out last weekend between Israel and Hamas is one of the biggest tests of social-media’s content policing in years. So far, Elon Musk’s X Corp. is stumbling.
   
• Americans didn’t pay an estimated $688 billion in taxes due on their 2021 returns—the largest shortfall ever. Audits and other enforcement will be stepped up to reduce the gap.
   
• AMC Entertainment Chief Executive Adam Aron was targeted last year in a blackmail plot, he said.

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