In the City: Trump May Be Great News for European Banks

As Donald Trump stokes European uncertainty via near-daily tariff threats, targets European Union goods and warms to the Kremlin at the expense of Ukraine and NATO, chief executives across the continent may soon be giving their US business relationships a historic rethink. Some already are. Earlier this week, Italian aerospace and defense company Leonardo S.p.A replaced Bank of America with German lender Deutsche Bank. And reports out of Italy show the government is rethinking a potential deal with Elon Musk's Starlink, instead considering alternatives like France's Eutelsat Communication. Both stories are striking examples of a fast-deteriorating transatlantic relationship. In this week's episode of In the City, we explore whether more European businesses will decouple from American companies and Wall Street. Bloomberg deals correspondent Dinesh Nair joins hosts David Merritt and Allegra Stratton.

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Yahoo

32 minutes ago

• Yahoo

America's economy faces a potential war shock: Surging oil prices

The American economy faces the unwelcome prospect of reignited inflation after the United States launched strikes on three nuclear facilities in Iran. High oil and gas prices are a near certainty, experts say. The big question now: How long will the fossil fuels price spike last? Oil prices are expected to rise by about $5 per barrel when markets open Sunday night, according to experts. 'We are looking at $80 oil on the open,' said Andy Lipow of Lipow Oil Associates. US oil hasn't closed above $80 a barrel since January and has largely hovered between $60 and $75 a barrel since August 2024. Relatively tame oil prices have lowered gas prices to below $3 a gallon in many parts of the country, a major source of price relief for inflation-weary consumers. It's unclear if any major spike in oil prices will be sustained for a long period. Oil prices have risen about 10% since Israel's surprise attack on June 13 and then fell on Friday after US President Donald Trump announced a two-week deadline on whether to strike Iran. 'One shouldn't necessarily assume that just because the price of oil goes up, it's going to stay there. It doesn't,' said Joe Brusuelas, chief economist for the accounting firm RSM. The direction oil prices take is likely to depend on whether Iran's parliament decides to block the Strait of Hormuz, a key trade route that accounts for about 20% of the world's crude oil. On Sunday, Iran's Foreign Minister Abbas Araghchi said his country has 'a variety of options' when deciding how to respond to the US attacks and a prominent adviser to Iran's supreme leader has already called for the closure of the Strait of Hormuz. Bob McNally, president of consulting firm Rapidan Energy Group and former energy adviser to President George W. Bush, said that should Iran cut off the world's oil supply by closing the strait it would risk more military force from the United States and its allies. Iran could also attack infrastructure in the Persian Gulf that treats and exports oil and gas. 'It's possible they will decide the only thing that can dissuade President Trump is the fear of an oil price spike,' he said. 'They have to actually create that fear.' Appearing Sunday on Fox News, Secretary of State Marco Rubio called on China to prevent Iran from closing the Strait of Hormuz, adding that closing it would do more damage to other economies than the US economy. China buys a third of all oil that comes from the Persian Gulf, while the United States buys less than 3%. 'I encourage the Chinese government in Beijing to call them about that, because they heavily depend on the Straits of Hormuz for their oil,' Rubio said. Rubio added that closing the strait would hurt other countries' economies more than the US economy. Meanwhile, American consumers may soon feel a price shock at the pump. 'It takes five days or so for stations to pass along the prices they see in one day. If oil markets do surge today and then tomorrow, it could start showing up at the pump in a matter of hours,' said Patrick De Haan, vice president of petroleum analysis at GasBuddy, a fuel tracking platform. According to Lipow, should the Strait of Hormuz be affected, the price of oil could rise to $100 a barrel, which would raise gas and diesel prices by about 75 cents per gallon from recent levels. Meanwhile, US trade policies combined with the war with Iran 'strongly suggest inflation will be moving faster and higher over the next 90 days,' according to Brusuelas. Many mainstream economists argue that the low inflation of the spring represents a calm before the summer storm, when they expect prices to rise because of Trump's tariffs. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data

Newsweek

34 minutes ago

• Newsweek

How Could Strait of Hormuz Closure Impact Americans?

Based on facts, either observed and verified firsthand by the reporter, or reported and verified from knowledgeable sources. Newsweek AI is in beta. Translations may contain inaccuracies—please refer to the original content. Iranian lawmakers have voted to support closing the Strait of Hormuz—a vital route for global oil and gas shipments—in response to U.S. airstrikes on three of the country's nuclear sites on Saturday, a move that if agreed upon by the Supreme Leader, could disrupt energy markets and drive up prices worldwide and stateside. Why It Matters Following U.S. strikes on three Iranian nuclear sites, Isfahan, Fordow, and Natanz, the world waits as Iran considers its response. The Strait of Hormuz is a narrow, yet incredibly strategic waterway connecting the Persian Gulf to the Gulf of Oman and the Arabian Sea. At its narrowest point, the strait is about 21 miles wide, with two shipping lanes that are 2 miles wide in each direction. Around 20 percent of global oil trade passes through the Strait, with any closure likely to spike global prices. What To Know In the first fiscal quarter of 2025, the U.S. Energy Information Agency (EIA) noted that just under 15 million barrels of crude oil and condensate, and about 8 million barrels of petroleum products were transported through the Strait. There are very few alternative routes for the large volume of oil that passes through the chokepoint. The average 20 million barrels of oil products that pass through make up around 20 percent of the global consumption. The price of Brent crude oil was already climbing ahead of the U.S. strikes, increasing from $69 per barrel on June 12 to $74 per barrel on June 13. While the EIA estimates that a large majority, around 80 percent, of the oil-based product moving through the Strait go to Asian markets, around 2 million barrels a day end up in the U.S. Stena Impero being seized and detained between July 19 and July 21, 2019 in Bandar Abbas, Iran as it passed through the Strait of Hormuz, a vital regional shipping channel. Stena Impero being seized and detained between July 19 and July 21, 2019 in Bandar Abbas, Iran as it passed through the Strait of Hormuz, a vital regional shipping channel. Tasnim/Getty Images If the Iranian government following the lead of the parliament, decides to close the Strait, Asian markets are expected to be most hit, but American markets will be too. Despite influence over the Strait, Iran doesn't supply the most oil that transports through it, Saudi Arabia does. Some experts have said that if Iran were to cut off access to the Strait, it could spike oil prices by 30 to 50 percent immediately, with gas prices likewise rising. "Oil prices would likely double, to well above $100. The extent to which that price shock would be sustainable is unclear," Marko Papic, chief strategist at BCA Research, told Newsweek in an email Sunday. He also noted that due to the overwhelming pressure campaign the country would face over its closure "the price shock would be of limited duration." "However," he continued, "it could impact confidence domestically, impact capex [capital expenditure] intentions by corporates, and thus trickle into the animal spirits [psychological factors that influence economic behavior] that affects not just stocks, but also the labor market." Fears that Iran could attack U.S. oil infrastructure in the region and levy its power over the Straits of Hormuz could "combine to make prices and speculation rise about the security and dependability of supply," Greg Kennedy, director of the Economic Conflict and Competition Research Group at King's College London, previously told Newsweek. "Lack of clarity of how long this condition will last will also lead to hoarding or preemptive purchasing by other nations, so there are competition supply fears that will drive up prices," he added. Iran has been reluctant to close to Strait, even during times of intense conflict during the heat of the Iran-Iraq war. Infographic with map of the Gulf showing maritime tanker traffic in September 2024 through the Strait of Hormuz. Infographic with map of the Gulf showing maritime tanker traffic in September 2024 through the Strait of Hormuz. NALINI LEPETIT-CHELLA,OMAR KAMAL/AFP via Getty Images) What People Are Saying Greg Kennedy, director of the Economic Conflict and Competition Research Group at King's College London, told Newsweek: "This is not an act that just stays in the Gulf region, it has wider global strategic ripples." Spencer Hakimian, founder of Tolou Capital Management, wrote on X, formerly Twitter, on Saturday: "There are close to 50 large oil tankers scrambling to leave the Strait of Hormuz right now. Looks like the oil industry is expecting the Strait to be blockaded in the coming days." President Donald Trump wrote on Truth Social on Saturday evening: "ANY RETALIATION BY IRAN AGAINST THE UNITED STATES OF AMERICA WILL BE MET WITH FORCE FAR GREATER THAN WHAT WAS WITNESSED TONIGHT. THANK YOU! DONALD J. TRUMP, PRESIDENT OF THE UNITED STATES." Brian Krassenstein, who has over 900,000 followers on X wrote on Sunday if the Strait is closed, people can expect: "U.S. Gas Prices likely Skyrocket. Potential $5–$7/gallon range depending on duration. Military Escalation Risk. U.S. Navy and allies likely to respond. Tanker delays affect oil, LNG, and related goods." What Happens Next? Any final decision on Iran's response, whether negotiation or closing the Strait or other, however, will largely rest with the country's leader Ayatollah Ali Khamenei. The parliament vote to close the Strait merely advises him of the option to pursue.

Fox News

35 minutes ago

• Fox News

‘Open borders' under Biden could help Iran retaliate with US terror sleeper cells: former FBI boss

United States officials are sounding the alarm regarding the threat of terror-backed sleeper cells within the country just hours after President Donald Trump successfully ordered the elimination of key nuclear facilities within Iran. Just hours after Trump addressed the nation on U.S. military strikes on the Iranian nuclear sites, the DHS released a new memo sounding the alarm to a "heightened threat environment in the United States." The bulletin from the National Terrorism Advisory System did not cite any specific threats but comes as Iranian officials have threatened retaliation. With the regime's nuclear program severely set back, and its infrastructure bombarded during Israel's operation, one former FBI boss told Fox News Digital that Iran and its proxies could resort to their original tactic -- terrorism. And the border crisis under the Biden administration only exacerbates the threat of terror cells in the U.S. activating to harm Americans at home. "The likelihood of violent extremists in the Homeland independently mobilizing to violence in response to the conflict would likely increase if the Iranian leadership issued a religious ruling calling for retaliatory violence against targets in the Homeland," the bulletin states. "It is our duty to keep the nation safe and informed, especially during times of conflict," the Department of Homeland Security said in a statement to Fox News Digital. "The ongoing Israel-Iran conflict brings the possibility of increased threat to the homeland in the form of possible cyberattacks, acts of violence, and antisemitic hate crimes." The bulletin points to law enforcement within the U.S. disrupting "multiple potentially lethal Iranian-backed plots" since 2020, while noting the Iranian government's unsuccessful attempts to target critics of its regime. Iran previously vowed to retaliate if the U.S. became involved in Israel's attack, which began after Israeli airstrikes targeted Iranian military and nuclear facilities on June 13. Prior to the attack, Trump issued a warning to Iran against retaliating, while encouraging the country's leaders to come to a peace deal with Israel. Immediately following the strikes, Trump vowed to target additional sites within Iran "if peace does not come quickly." The advisory comes after Trump ordered military strikes on Iran's key nuclear facilities in what officials are calling "Operation Midnight Hammer," prompting law enforcement to be on high alert regarding the threat of foreign adversary operatives conducting an attack on U.S. soil, with thousands of Iranian nationals previously crossing over the border. "Because of the open borders, we are at a serious catch-up phase" Former FBI assistant director Chris Swecker told Fox News Digital. "We don't know where those thousand Iranians are and who knows how many others got across the border. We missed an opportunity when they caught and released those thousand. We missed the opportunity to gather intel by interviewing them and thoroughly vetting them. We just simply let them go, which is gross negligence on the part of the Biden administration." U.S. Customs and Border Protection did not immediately respond to Fox News Digital's request for comment. "We don't know where those thousand Iranians are and who knows how many others got across the border." Over 1,200 Iranian nationals reportedly entered the U.S. during former President Joe Biden's time in office, White House border czar Tom Homan told Maria Bartiromo on "Sunday Morning Futures." The threat of foreign nationals flowing into the U.S. raises concerns regarding possible domestic sleeper cells driven by foreign terrorist organizations, according to national security experts. "The challenge that the United States has had after a very long period of time, [is that] we had an open border," Michael Balboni, former Homeland Security advisor for New York state and a cybersecurity expert, told Fox News Digital. "Tens of millions of people came across and we don't know who they are, where they came from, what their capabilities are or their intentions." Swecker indicated the FBI has primarily focused its attention on homegrown attackers as foreign adversaries flowed into the country. "There's a certain population of Iranians in the U.S. that we know about, but there's thousands and thousands that we don't know about because of the open border situation," Swecker said. "The Bureau was concentrating their resources on so-called domestic terrorists like white supremacists and right-wing extremists, and calling them the most serious terrorist threat to this country when it was absolutely the international terrorists that should have been the focus of the bureau's efforts." The FBI declined Fox News Digital's request for comment. The possibility of foreign cells carrying out a domestic terror plot was pushed into the national spotlight last year after federal prosecutors announced a member of Iran's Islamic Revolutionary Guard Corps and two U.S.-nationals were arrested for allegedly plotting to murder then-President-elect Trump and a U.S. citizen critical of the Iranian regime. "The Iranians have shown a pretty good capability in terms of their intelligence apparatus and their operatives being able to work clandestinely," Balboni said. "They are fairly sophisticated when it comes to that, very determined. The question is how many are in the country and the answer is we don't know." The U.S. possesses a wide range of attractive targets, with national security concerns spiking after Trump ordered the assassination of Iranian General Qasem Soleimani in January 2020. "They're not going to quit," Swecker said. "They will never quit. And this was the right thing to do to take out their nuclear capabilities." Additionally, critical infrastructure within major cities remains a prime spot for cells to carry out destructive terror plots, with Iranian officials likely turning to proxy groups to sow fear within the population. "Electrical grids, perhaps medical facilities, transportation hubs," Balboni said. "Those types of things that have been a part of the playbook when you have these insurgencies that happened within the nation." Balboni points to instances of terror cells conducting pre-operational surveillance within the U.S., adding satellite mapping websites provide adversaries with a birds-eye view of key infrastructure. "Law enforcement and security personnel are really focused now on trying to prevent anything from happening," Balboni told Fox News Digital. "But the problem is if you've had tens of millions of people come across the border, you really don't know where they are and what their capabilities are." As tensions between the Middle East and the U.S. continue to spiral toward a breaking point, the National Terrorism Advisory System warns of U.S.-based individuals "plotting additional attacks" against pro-Israel targets, and U.S. government and military officials. "This is a time for calm, professionalism, information sharing and heightened awareness," Balboni said. "This will not be the first time we face a challenge like this. But certainly because of the hostilities, there is a heightened fear, concern and awareness that these types of attacks could happen in the United States."