Markets continue to tread water as crisis in Middle East hangs in the balance
Oil prices dipped on Friday after US president Donald Trump held off on a decision over involving the US military in the Israel-Iran conflict.
Oil prices are up on the week, though nowhere near as dramatically as might have been expected. On Friday Brent crude fell 2.9pc to $76.56 per barrel.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Irish Times
40 minutes ago
- Irish Times
Israel says it killed veteran Iran commander as both sides attack
Israel said on Saturday it had killed a veteran Iranian commander as the countries traded attacks, a day after Tehran said it would not negotiate over its nuclear programme while under threat and Europe tried to keep peace talks alive. Saeed Izadi, who led the Palestine Corps of the Quds Force, the Iranian Revolutionary Guards' overseas arm, was killed in a strike in an apartment in the Iranian city of Qom, said Israeli Defense minister Israel Katz. Calling his killing a 'major achievement for Israeli intelligence and the Air Force', Katz said in a statement that Izadi had financed and armed the Palestinian militant group Hamas in advance of its October 7th, 2023, attack on Israel, which triggered the war in Gaza . The Revolutionary Guards said five of its members had been killed in attacks on Khorramabad, according to Iranian media reports that did not mention Izadi, who was on US and British sanctions lists. READ MORE Iranian media had said earlier on Saturday that Israel had attacked a building in Qom, with initial reports of a 16-year-old killed and two people injured. Iran's Fars news agency said Israel had targeted the Isfahan nuclear facility, one of the nation's biggest, but there was no leakage of hazardous materials. The Israeli military said it had launched a wave of attacks against missile storage and launch infrastructure sites in Iran. Ali Shamkhani, a close ally of Iran's supreme leader, said he had survived an Israeli attack. 'It was my fate to stay with a wounded body, so I stay to continue to be the reason for the enemy's hostility,' he said in a message carried by state media. Early on Saturday, the Israeli military warned of an incoming missile barrage from Iran, triggering air raid sirens across parts of central Israel, including Tel Aviv, as well as in the Israeli-occupied West Bank. Interceptions were visible in the sky over Tel Aviv, with explosions echoing across the metropolitan area as Israel's air defence systems responded. There were no reports of casualties. Israel began attacking Iran on June 13th, saying its long-time enemy was on the verge of developing nuclear weapons. Iran, which says its nuclear programme is only for peaceful purposes, retaliated with missile and drone strikes on Israel. Israel is widely assumed to possess nuclear weapons. It neither confirms nor denies this. Its air attacks have killed 639 people in Iran, according to the Human Rights Activists News Agency, a US-based human rights organisation that tracks Iran. The dead include the military's top echelon and nuclear scientists. Iran's health minister, Mohammadreza Zafarqandi, said on Saturday that Israel has attacked three hospitals during the conflict, killing two health workers and a child, and has targeted six ambulances, according to Fars. The Israeli military did not immediately respond to a request for comment. An Iranian missile hit a hospital in the southern Israeli city of Beersheba on Thursday. Iran's Nournews on Saturday named 15 air defence officers and soldiers it said had been killed in the conflict with Israel. In Israel, 24 civilians have been killed in Iranian missile attacks, according to Israeli authorities. Iranian worshippers sit under banners featuring portraits of people killed in Israeli attacks, in Tehran on Friday. Photograph: Morteza Nikoubazl/NurPhoto via Getty Images US president Donald Trump said on Friday he thought Iran would be able to have a nuclear weapon 'within a matter of weeks, or certainly within a matter of months'. He told reporters at the airport in Morristown, New Jersey: 'We can't let that happen.' He said his director of national intelligence, Tulsi Gabbard, was wrong in suggesting there was no evidence Iran is building a nuclear weapon. Russia has repeatedly told Israel that there is no evidence Iran is aiming to get nuclear weapons, Sky News Arabia on Saturday quoted Russian president Vladimir Putin as saying in an interview. 'Russia, as well as the IAEA [International Atomic Energy Agency], has never had any evidence that Iran is preparing to obtain nuclear weapons, as we have repeatedly put the Israeli leadership on notice,' Sky News Arabia quoted Mr Putin as saying. Russia is ready to support Iran in developing a peaceful nuclear programme, Mr Putin was quoted as saying, adding that Iran has the right to do so. Speaking at an economic forum in St Petersburg on Friday, Mr Putin said Russia was sharing its ideas on how to stop the bloodshed in the Iran-Israel conflict with both sides. He did not give details of those ideas. Iranian foreign minister Abbas Araqchi said there was no room for negotiations with the US 'until Israeli aggression stops'. But he arrived in Geneva on Friday for talks with European foreign ministers at which Europe hopes to establish a path back to diplomacy. Mr Trump reiterated that he would take up to two weeks to decide whether the United States should enter the conflict on Israel's side, enough time 'to see whether or not people come to their senses', he said. Mr Trump said he was unlikely to press Israel to scale back its air strikes to allow negotiations to continue. 'I think it's very hard to make that request right now. If somebody is winning, it's a little bit harder to do than if somebody is losing, but we're ready, willing and able, and we've been speaking to Iran, and we'll see what happens,' he said. The Geneva talks produced little signs of progress, and Mr Trump said he doubted negotiators would be able to secure a ceasefire. 'Iran doesn't want to speak to Europe. They want to speak to us. Europe is not going to be able to help in this one,' Trump said. Hundreds of US citizens have fled Iran since the air war began, according to a US State Department cable seen by Reuters. Israel's envoy to the United Nations, Danny Danon, told the Security Council on Friday his country would not stop its attacks 'until Iran's nuclear threat is dismantled'. Iran's UN envoy Amir Saeid Iravani called for Security Council action and said Tehran was alarmed by reports that the US might join the war. Russia and China demanded immediate de-escalation. A senior Iranian official told Reuters that Iran was ready to discuss limitations on uranium enrichment but that it would reject any proposal that barred it from enriching uranium completely, 'especially now under Israel's strikes'. – Reuters
Irish Times
4 hours ago
- Irish Times
If Netanyahu wants regime change in Iran, it is unlikely to end well
It is not yet certain whether Donald Trump will approve US involvement in Israel 's assault on Iran which began last week. While Israel has inflicted severe losses on Iran and appears to have disabled its air defences, there is a broad consensus that, without US intervention, the goal of disabling Iran's nuclear programme will be unachievable. To this end, a great deal of attention has been paid to the Fordow nuclear facility , close to the city of Qom, which is at the heart of the programme of uranium enrichment and much of which is located 80-90m underground. In 2009, the International Atomic Energy Agency (IAEA) confirmed that the facility held about 3,000 centrifuges which are central to the enrichment process. Under the Joint Comprehensive Plan of Action (JCPOA), the deal which Iran signed in 2015, uranium enrichment ceased at Fordow. But, when the US pulled out of that agreement under the first Trump administration, production restarted. Now the assumption is that only the so-called 'bunker buster' bombs possessed by the US are capable of destroying the facility at Fordow. However, the US president's announcement of a two-week deadline to decide if his country will join Israel's attack speaks to uncertainty regarding its likely success and divisions within his support base. Either way, the one-sided nature of the conflict so far – which has seen Israel inflict far more significant losses on Iran, both in terms of military leadership and civilian casualties, than it has sustained – raises the question of whether regime-change in Tehran is on the agenda. From the outset, Israeli leaders have expressly stated that this is not a key objective. However, they have made it equally clear that they would welcome the fall of the Islamic Republic should it happen. Indeed, Binyamin Netanyahu has called on Iranians to 'stand up for their freedom'. As for Trump, his rhetoric has shifted dramatically over the course of the past several weeks, from an initial position which saw him urge restraint on Netanyahu, and talk up the prospect of success in negotiations with Iran on its nuclear programme, to his more recent darker utterances regarding the prospect of direct US involvement to put an end to Iran's nuclear ambitions. All of this, in turn, suggests Trump has been bounced into supporting Israel's assault on Iran through Netanyahu's pre-emptive actions last Thursday. READ MORE Israel needs Trump's 'bunker buster' but will US enter the war? Listen | 31:22 Since Israel launched air strikes on Iran last Friday, the two states have traded missiles with mounting casualties on both military leaders have been killed as have some of its nuclear scientists but the country's citizens have borne the brunt of the air has said its rationale for the middle-of-the-night attack that sparked the war was its need to ensure, for its own protection, that Iran's nuclear programme is close Iran is to actually having a nuclear bomb is unclear but for Israel to obliterate entirely the nuclear threat it needs the US to join the war, to send its 'bunker buster' mega bomb to destroy the Fordo uranium enrichment facility buried deep in the by Bernice Harrison. Produced by Declan Conlon. While the likely course of US action on Iran remains unpredictable, it is clear that neither Israel nor the United States has a plan for – or indeed any coherent understanding of – what might follow from the fall of the regime in Tehran, beyond wilfully optimistic assumptions regarding its positive impact on the country and the region. However, history teaches us that such optimistic assumptions are rarely well placed. The reality is that when we have seen external involvement in the affairs of Iran and the Middle East more generally, the results have never been straightforward and rarely positive. [ Could Israel's attacks on Iran create a nuclear contamination risk? Opens in new window ] In Iran in 1953, the country's democratically elected prime minister, Mohammed Mossadeq, was overthrown in a coup orchestrated by the US Central Intelligence Agency (CIA). Mossadeq's government nationalised the Anglo-Iranian Oil Company (which was a forerunner to BP), a move that was widely popular in the country but alarming to the UK and the US. As events unfolded, the Shah of Iran, fearing the worst, left the country. However, Mossadeq was removed from power in August 1953 and the Shah returned to preside over an increasingly repressive regime, until his removal during the revolution of 1979. As is so often the case with external interventions of this nature, Mossadeq's removal had unintended consequences. The events of 1953 dealt a severe blow to liberal and democratic politics in Iran while the Shah was seen as little more than an American puppet – factors contributing to the revolution which ended his rule in 1979 and inaugurated the Islamic Republic of Iran. More recently, the ill-conceived US-led invasion of Iraq in 2003 brought years of violent conflict to the country, led to the sectarianisation of its politics and helped pave the way for the emergence of the so-called Islamic State , while strengthening the position of the Iranian regime in the region, along the way. Likewise, western intervention in Libya in 2011 did nothing to contribute to peace and stability in that country. This is not to say that Iranians cannot mobilise in the face of a repressive regime; Iran has a long history of such mobilisation. As far back as the early 20th century, the 'constitutional revolution' of the period from 1906 to 1911 saw mass demonstrations that forced the Shah to agree to a written constitution and the establishment of an elected parliament. That mobilisation was motivated by a number of grievances, including disillusionment with the ruling elite, as well as resentment at foreign influence and interference in the affairs of the country. While many of the gains of this period were subsequently reversed, the constitution remained in place until the revolution of 1979. Decades later, mass mobilisation led to the end of the Pahlavi dynasty, which had ruled Iran since 1925 with significant western support. However, the post-1979 period has also witnessed expressions of dissent from the governing orthodoxy in the country. In 2009, mass protests broke out when the hardline Mahmoud Ahmadinejad claimed victory in the presidential election of June 12th that year, despite widespread electoral irregularities and claims by opposition candidates that the vote was rigged. After the announcement of the results, supporters of opposition candidates took to the streets in protest. By June 15th, as many as two million people were on the streets of Tehran. The protests were ultimately suppressed with the deaths of dozens of protesters and the arrests of thousands. Thirteen years later, unrest and protests broke out again on a mass scale following the death in police custody of Mahsa Amini, whose 'crime' was the violation of Iran's mandatory hijab law by wearing hers 'improperly'. The protest movement that followed adopted the slogan 'Women, Life, Freedom' but subsequently grew into open calls for the removal of the Supreme Leader, Ali Khamenei. Once more the protests were violently suppressed, and 500 people lost their lives. Popular mobilisation in Iran for more than 100 years has been driven by domestic actors in pursuit of domestic agendas and never by external forces. It is unlikely that Netanyahu's call on the Iranian people to rise up and overthrow their government will alter that record. Dr Vincent Durac lectures in Middle East politics in the UCD school of politics and international relations
Irish Times
4 hours ago
- Irish Times
Despite being obsessed with money, Donald Trump does not understand how it works
In Dante's Inferno, the poet reserved one of his most ghastly punishments for the crime of forgery. Canto 30 of the Inferno describes the counterfeiter 'Adamo' condemned to the eighth circle of hell, just one above Lucifer in the ninth. In this Canto, Dante and Virgil, his guide through the underworld, meet two falsifiers, one of whom is Maestro Adamo/Master Adam, a counterfeiter who in Dante's youth had tried to debase the Florentine florin. Adamo has studied in Brescia, an Italian city in competition with Florence. He was persuaded by prosperous counts from Romena to debase the florin by replacing three carats of the usually pure gold coin with copper. The coin weighed almost the same, but it was a fake. Dante compares Adam to another liar, Sinon the Greek, the man who tricked the Trojans into believing the Trojan horse was an innocent gift. This betrayal led to the destruction of an entire civilisation. READ MORE Why would Dante equate Adam, an everyday opportunistic counterfeiter, with Sinon, the man who betrayed Troy? It seems disproportionate, but only if we fail to appreciate the central role of the florin in underpinning the might of Florence. In Dante's tale, the man who was undermining the reserve currency was a two-bit fraudster, Adam, whereas today the man undermining the world's reserve currency, the US dollar, is the president of the United States, Donald Trump . Traditionally, when the world is at war, financial markets experience a flight to quality, meaning to dollars. The opposite is happening and, for the first time in 100 years, the world is starting to doubt America's commercial credibility. In the Florentine Republic one florin was worth about €125 in today's money, and to give you a sense of what that meant at the time, a slave girl or a mule could be bought for 50 florins – about €6,000. As the Florentines expanded commercially throughout Europe, the florin became the trademark of the strength of the city as much as a medium of exchange. Pure gold, weighing 3.53 grammes, it became the reserve currency of mercantile Europe, giving it the pre-eminent role in international finance, like the US dollar today. Across the Continent, goods were exchanged in florins, debts were settled in florins, loans were extended in florins and wealth was measured and stored in florins. In the 14th century, the florin became the hardest currency in Europe, accepted widely as the unit of account from London and Bruges in the north, to Alexandria and Tyre in the south. When the world accepts your currency readily, it gives the currency that most elusive of qualities: liquidity. A simple definition of liquidity is the ease and time it takes to settle a trade in a currency. The more liquidity, the easier it is to trade. If, in the case of a coin, there is significant demand for the products underpinning the coin, the number of coins supplied will go up and, while their value will stay the same, their intrinsic usability and therefore practical value increases. Given its liquidity, everyone wanted to settle their account with the florin. The state that mints the money that everyone wants has soft power. Soft power is the power of persuasion. In today's context, consider the power the US dollar gives the United States. Oil, copper, steel, uranium, rare earths, timber, cotton, silk, diamonds – all these commodities are priced internationally in dollars, and to buy them the purchaser must first buy dollars, which the US generates for free. This gives the US a big advantage in global financial affairs. Given such high stakes, why would any president mess with America's most potent weapon? Because, despite being obsessed by money, he doesn't really understand money, how it works and what maintains its mystique. It's about trust (that most ephemeral of characteristics), financial stability and the long-term robustness of entire economic system. [ US borrowing costs top 5% after Moody's downgrade Opens in new window ] Reputations are very hard to establish but easy to squander. Donald Trump is squandering America's reputation as a serious country. The US's economic mix is now a unpredictable mess of unfocused tax cuts, broadening but incoherent tax loopholes, incremental attacks on the rule of law and, of course, chaotic trade wars and tariffs. While these may generate headlines, they do not promote financial stability. In the meantime, in plain sight, the Trump family are enriching themselves in cryptocurrencies. Congress is blessing this heist, while the US president habitually insults the Federal Reserve chairman, stating this week that he'd do a far better job himself, if only he could appoint himself . Is it any surprise that rational people are avoiding the dollar? The real dilemma is that Trump is behaving like a medieval king burning through the kingdom's treasury, which is already overspending. The US federal debt-to-GDP ratio is at its highest level in postwar history and climbing. At 97 per cent to 99 per cent of GDP, the debt is up from 35 per cent of GDP in the 1980s and about 60 per cent before the 2008 financial crisis. This level is comparable to the debt burden just after the second World War (when it peaked around 106 per cent of GDP in 1946). In the past 12 months, the US government spent in excess of $1.8 trillion more than it took in, marking the fifth year in a row with a deficit above $1 trillion. One of the most immediate consequences of high debt is the surging cost of interest. As debt has grown, and the Federal Reserve's rate hikes in 2022–2023 filtered through to government borrowing costs, interest costs have skyrocketed. Last year, the US Treasury paid about $882 billion in interest on the federal debt, roughly 3.1 per cent of GDP. [ Donald Trump pressures Republicans to back his 'big, beautiful' tax Bill Opens in new window ] To put that in perspective, America now spends more just to service its debt than it spends on national defence or Medicare. On top of this already-fraught situation, the One Big Beautiful Act with its tax cuts for the wealthy, will add more debt to the existing $36.7 trillion pile. Official estimates suggest the Trump tax cuts will add another $2.4 trillion to the debt. So who is going to buy all this new debt? Foreigners who historically buy a large share of US Treasuries bought only about 59 per cent of a recent 30-year Treasury auction, the lowest foreign participation since 2019. If foreign investors are to be coaxed to buy more US IOUs then they will have to be offered a higher rate of interest, which could push the US into recession, or a lower dollar which means that the US debt is made cheaper for foreigners. Once this occurs, the dollar and the Donald become intertwined. As US economic credibility is shredded, so too the mystique of the reserve currency. It's early days but a world where the US dollar is not the only reserve currency could be upon us. The Florentine florin was the world's reserve currency for close to 250 years, from the time of Dante to the discovery of the Americas. Wars, poor decision-making and over-spending at home in Florence, as well as the emergence of other commercial powers abroad, chipped away at its elevated status. Could something similar be happening to the US dollar now? Of course it could.
