Mōrena and welcome to your Tuesday update on international business and political news from overnight.
The situation in Iran continues to dominate news sites. In developing news, Iran confirmed it had launched missiles towards US air bases in Qatar and Iraq, the ABC reported.
It followed US strikes against three Iranian nuclear sites on the weekend, while Iran and Israel continued to trade missile attacks on Monday local time.
An adviser to Qatari Prime Minister Majed Al Ansari said the missiles had been successfully intercepted. Meanwhile, Qatar’s interior ministry said the security situation in the country “remains stable” after Iran’s unsuccessful attack on the Al Udeid Air Base, CNN reported.
“The base which was targeted by the powerful Iranian forces is far away from urban installations and residential areas in Qatar. This action has no dangerous aspect to our friendly and brotherly country of Qatar and its noble people,” the Secretariat of Iran’s Supreme National Security Council said.
BBC journalists said direct US involvement in the Middle East conflict could stoke tensions for longer.
US President Donald Trump raised the prospect of "regime change" in Iran, which North America correspondent Anthony Zurcher said added risks for US troops in the region.
Attention was also on the worst-case scenario for the oil market if Iran followed through and closed the Strait of Hormuz, an important route for more than 20 million barrels of crude oil each day, CNBC reported.
Iranian state media reported that Iran’s parliament had backed closing of the strait, but the final decision was needed from Iran’s National Security Council.
US Secretary of State Marco Rubio warned Iran against the closure, calling it “economic suicide” for the Islamic Republic because their exports pass through the waterway.
Yesterday, University of Auckland Associate Professor of Politics and International Relations Stephen Hoadley cautioned that an oil price shock could be on the way. He said if European sanctions against Russia also came into effect, that would be a “double hit” on global oil supply.
The Guardian reported that global financial markets reacted calmly to the US attacks on Iran’s nuclear facilities.
Oil initially rose 5% in early trading, before those gains were erased after Trump called for cheaper prices. He also called for the US to increase its own oil production.
“To the Department of Energy: DRILL, BABY, DRILL!!! And I mean NOW!!!”.
Economists warned oil prices could jump if supplies were disrupted. Goldman Sachs estimated Brent crude oil could rise to over US$100 per barrel if the Strait of Hormuz was disrupted, the Guardian said.
The head of the International Monetary Fund also warned of damage to global economic growth. Kristalina Georgieva told Bloomberg that a rise in oil prices could have a ripple effect. “There could be secondary and tertiary impacts,” she said.
“Let’s say there is more turbulence that goes into hitting growth prospects in large economies, then you have a trigger impact of downward revisions in prospects for global growth.”
On Wall Street, CNBC reported that the Dow Jones, S&P500, and tech-heavy Nasdaq made gains during Monday trading, while oil prices fell because traders thought supply wouldn’t be materially disrupted by the Middle East conflict.
Meanwhile, Ukrainian President Volodymyr Zelensky described Russia, Iran, and North Korea as a "coalition of murderers" during his visit to the UK, the ABC reported.
"Everyone in countries neighbouring Russia, Iran, and North Korea should be thinking carefully about whether they could protect lives if this coalition of murderers persists and continues spreading their terror," he posted on social media.
Canadian Prime Minister Mark Carney.
In other news, the European Union and Canada signed a security partnership that moves them closer to cooperation on military purchases, Bloomberg reported.
Prime Minister Mark Carney aimed to reduce his country’s reliance on the US for defence. The new security deal said Canada and the EU could “explore possible mutual involvement” in defence initiatives.
Finally, the UK government planned to cut green levies on thousands of businesses to help reduce energy costs and boost manufacturing, the Guardian reported. More than 7000 businesses could be in line for cheaper energy bills. UK manufacturers had been frustrated with high power costs, as well as delays in connecting to the grid.
Prime Minister Keir Starmer said it would be a “turning point” for the UK economy. “In an era of global economic instability, it delivers the long-term certainty and direction British businesses need to invest, innovate, and create good jobs that put more money in people’s pockets as part of the plan for change.”
