Global stocks rise as trade hopes feed risk appetite

World stocks have hovered around their highest prices in six weeks after a US trade deal with Britain fuelled guarded optimism for progress in tariff talks with other countries.
MSCI's broadest index of world shares gained 0.1 per cent on Friday after jumping about 0.8 per cent the previous day to levels seen just before Trump's "Liberation Day" global tariff announcements.
"The deal between the US and UK was more style over substance," said Kyle Rodda, a senior financial markets analyst at Capital.com.
The "general terms" agreement leaves in place a 10 per cent tariff on goods imported from the UK but lowers prohibitive US duties on UK car exports. Britain agreed to lower its tariffs to 1.8 per cent from 5.1 per cent and provide greater access to US goods.
"However, it feeds the narrative that the US is looking to bang out rapid-fire trade deals and reduce tariffs - at the margins - and other trade barriers," Rodda said.
Last week, Trump said he has "potential" trade deals with India, South Korea and Japan.
Trump pushed back against seeing the UK deal as a template for other negotiations, perhaps, including those due Saturday when US Treasury Secretary Scott Bessent and chief trade negotiator Jamieson Greer will meet China's economic tsar He Lifeng in Switzerland.
European stock markets opened higher on Friday.
The pan-European STOXX 600 index rose 0.4 per cent, with all regional bourses trading higher.
An investor rush from safe assets such as government bonds into riskier ones such as stocks might meant markets are getting ahead of themselves on optimism, said James Rossiter, head of global macro strategy at TD Securities.
"The trade deal isn't really a trade deal. It's an agreement on a few narrow topics. Still, it shows there is a degree of movement and that some tariffs could be mitigated," Rossiter said.
Even so, "tariffs are not going away".
Reaction to the UK trade agreement yesterday and the optimistic trade figures that emerged yesterday from China have pushed markets higher temporarily, but "the fundamentals behind what markets are seeing are not as robust", Rossiter said.
Safe-haven German Bund prices fell on Friday, driving yields 5.2 basis points higher as investors dropped their bonds for assets with higher returns.
Bitcoin soared to the highest since January and US crude ticked up after a more than three per cent surge on Thursday.
Brent crude added 85 cents to $US63.70 a barrel following Thursday's 2.8 per cent rally.
NYMEX US crude skipped up 84 cents to $US60.76 a barrel on Friday, building on the previous day's surge.
The US dollar index, which measures the currency against six major peers, edged away from Thursday's one-month peak to be down 0.3 per cent.
The euro rose from its one-month trough at $US1.1257, and sterling ticked up 0.2 per cent to $US1.3270.
Mainland China blue chips closed down 0.2 per cent, while Hong Kong's Hang Seng ended 0.4 per cent higher.
Japan's Nikkei soared 1.6 per cent and Taiwan's equity benchmark advanced 1.8 per cent, with technology shares the strongest performing sector.
World stocks have hovered around their highest prices in six weeks after a US trade deal with Britain fuelled guarded optimism for progress in tariff talks with other countries.
MSCI's broadest index of world shares gained 0.1 per cent on Friday after jumping about 0.8 per cent the previous day to levels seen just before Trump's "Liberation Day" global tariff announcements.
"The deal between the US and UK was more style over substance," said Kyle Rodda, a senior financial markets analyst at Capital.com.
The "general terms" agreement leaves in place a 10 per cent tariff on goods imported from the UK but lowers prohibitive US duties on UK car exports. Britain agreed to lower its tariffs to 1.8 per cent from 5.1 per cent and provide greater access to US goods.
"However, it feeds the narrative that the US is looking to bang out rapid-fire trade deals and reduce tariffs - at the margins - and other trade barriers," Rodda said.
Last week, Trump said he has "potential" trade deals with India, South Korea and Japan.
Trump pushed back against seeing the UK deal as a template for other negotiations, perhaps, including those due Saturday when US Treasury Secretary Scott Bessent and chief trade negotiator Jamieson Greer will meet China's economic tsar He Lifeng in Switzerland.
European stock markets opened higher on Friday.
The pan-European STOXX 600 index rose 0.4 per cent, with all regional bourses trading higher.
An investor rush from safe assets such as government bonds into riskier ones such as stocks might meant markets are getting ahead of themselves on optimism, said James Rossiter, head of global macro strategy at TD Securities.
"The trade deal isn't really a trade deal. It's an agreement on a few narrow topics. Still, it shows there is a degree of movement and that some tariffs could be mitigated," Rossiter said.
Even so, "tariffs are not going away".
Reaction to the UK trade agreement yesterday and the optimistic trade figures that emerged yesterday from China have pushed markets higher temporarily, but "the fundamentals behind what markets are seeing are not as robust", Rossiter said.
Safe-haven German Bund prices fell on Friday, driving yields 5.2 basis points higher as investors dropped their bonds for assets with higher returns.
Bitcoin soared to the highest since January and US crude ticked up after a more than three per cent surge on Thursday.
Brent crude added 85 cents to $US63.70 a barrel following Thursday's 2.8 per cent rally.
NYMEX US crude skipped up 84 cents to $US60.76 a barrel on Friday, building on the previous day's surge.
The US dollar index, which measures the currency against six major peers, edged away from Thursday's one-month peak to be down 0.3 per cent.
The euro rose from its one-month trough at $US1.1257, and sterling ticked up 0.2 per cent to $US1.3270.
Mainland China blue chips closed down 0.2 per cent, while Hong Kong's Hang Seng ended 0.4 per cent higher.
Japan's Nikkei soared 1.6 per cent and Taiwan's equity benchmark advanced 1.8 per cent, with technology shares the strongest performing sector.
World stocks have hovered around their highest prices in six weeks after a US trade deal with Britain fuelled guarded optimism for progress in tariff talks with other countries.
MSCI's broadest index of world shares gained 0.1 per cent on Friday after jumping about 0.8 per cent the previous day to levels seen just before Trump's "Liberation Day" global tariff announcements.
"The deal between the US and UK was more style over substance," said Kyle Rodda, a senior financial markets analyst at Capital.com.
The "general terms" agreement leaves in place a 10 per cent tariff on goods imported from the UK but lowers prohibitive US duties on UK car exports. Britain agreed to lower its tariffs to 1.8 per cent from 5.1 per cent and provide greater access to US goods.
"However, it feeds the narrative that the US is looking to bang out rapid-fire trade deals and reduce tariffs - at the margins - and other trade barriers," Rodda said.
Last week, Trump said he has "potential" trade deals with India, South Korea and Japan.
Trump pushed back against seeing the UK deal as a template for other negotiations, perhaps, including those due Saturday when US Treasury Secretary Scott Bessent and chief trade negotiator Jamieson Greer will meet China's economic tsar He Lifeng in Switzerland.
European stock markets opened higher on Friday.
The pan-European STOXX 600 index rose 0.4 per cent, with all regional bourses trading higher.
An investor rush from safe assets such as government bonds into riskier ones such as stocks might meant markets are getting ahead of themselves on optimism, said James Rossiter, head of global macro strategy at TD Securities.
"The trade deal isn't really a trade deal. It's an agreement on a few narrow topics. Still, it shows there is a degree of movement and that some tariffs could be mitigated," Rossiter said.
Even so, "tariffs are not going away".
Reaction to the UK trade agreement yesterday and the optimistic trade figures that emerged yesterday from China have pushed markets higher temporarily, but "the fundamentals behind what markets are seeing are not as robust", Rossiter said.
Safe-haven German Bund prices fell on Friday, driving yields 5.2 basis points higher as investors dropped their bonds for assets with higher returns.
Bitcoin soared to the highest since January and US crude ticked up after a more than three per cent surge on Thursday.
Brent crude added 85 cents to $US63.70 a barrel following Thursday's 2.8 per cent rally.
NYMEX US crude skipped up 84 cents to $US60.76 a barrel on Friday, building on the previous day's surge.
The US dollar index, which measures the currency against six major peers, edged away from Thursday's one-month peak to be down 0.3 per cent.
The euro rose from its one-month trough at $US1.1257, and sterling ticked up 0.2 per cent to $US1.3270.
Mainland China blue chips closed down 0.2 per cent, while Hong Kong's Hang Seng ended 0.4 per cent higher.
Japan's Nikkei soared 1.6 per cent and Taiwan's equity benchmark advanced 1.8 per cent, with technology shares the strongest performing sector.
World stocks have hovered around their highest prices in six weeks after a US trade deal with Britain fuelled guarded optimism for progress in tariff talks with other countries.
MSCI's broadest index of world shares gained 0.1 per cent on Friday after jumping about 0.8 per cent the previous day to levels seen just before Trump's "Liberation Day" global tariff announcements.
"The deal between the US and UK was more style over substance," said Kyle Rodda, a senior financial markets analyst at Capital.com.
The "general terms" agreement leaves in place a 10 per cent tariff on goods imported from the UK but lowers prohibitive US duties on UK car exports. Britain agreed to lower its tariffs to 1.8 per cent from 5.1 per cent and provide greater access to US goods.
"However, it feeds the narrative that the US is looking to bang out rapid-fire trade deals and reduce tariffs - at the margins - and other trade barriers," Rodda said.
Last week, Trump said he has "potential" trade deals with India, South Korea and Japan.
Trump pushed back against seeing the UK deal as a template for other negotiations, perhaps, including those due Saturday when US Treasury Secretary Scott Bessent and chief trade negotiator Jamieson Greer will meet China's economic tsar He Lifeng in Switzerland.
European stock markets opened higher on Friday.
The pan-European STOXX 600 index rose 0.4 per cent, with all regional bourses trading higher.
An investor rush from safe assets such as government bonds into riskier ones such as stocks might meant markets are getting ahead of themselves on optimism, said James Rossiter, head of global macro strategy at TD Securities.
"The trade deal isn't really a trade deal. It's an agreement on a few narrow topics. Still, it shows there is a degree of movement and that some tariffs could be mitigated," Rossiter said.
Even so, "tariffs are not going away".
Reaction to the UK trade agreement yesterday and the optimistic trade figures that emerged yesterday from China have pushed markets higher temporarily, but "the fundamentals behind what markets are seeing are not as robust", Rossiter said.
Safe-haven German Bund prices fell on Friday, driving yields 5.2 basis points higher as investors dropped their bonds for assets with higher returns.
Bitcoin soared to the highest since January and US crude ticked up after a more than three per cent surge on Thursday.
Brent crude added 85 cents to $US63.70 a barrel following Thursday's 2.8 per cent rally.
NYMEX US crude skipped up 84 cents to $US60.76 a barrel on Friday, building on the previous day's surge.
The US dollar index, which measures the currency against six major peers, edged away from Thursday's one-month peak to be down 0.3 per cent.
The euro rose from its one-month trough at $US1.1257, and sterling ticked up 0.2 per cent to $US1.3270.
Mainland China blue chips closed down 0.2 per cent, while Hong Kong's Hang Seng ended 0.4 per cent higher.
Japan's Nikkei soared 1.6 per cent and Taiwan's equity benchmark advanced 1.8 per cent, with technology shares the strongest performing sector.

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One wouldn't want to deprive Albanese of any credit he deserved, but...

Anthony Albanese is falling back into the sort of bad habits that could bring him down as Labor leader. Despite talking of national conversations about productivity, about tax, and about Australia's sense of itself, he seems to think discussions can take place behind closed doors, with selected participants working off his agenda, and with the general public unable to see, hear, or get even a smell or a taste of what it was all about until it has come to its predetermined conclusion. That's not a way to build a national consensus or a common understanding of how the nation will face the future. While backroom deals and fixes may see him through some of the economic problems, a failure to have a wide consultation could do him great damage when it comes to Australia's reorienting itself to current circumstances in our neighbourhood, and in whatever remains of the Western alliance. It may be that the AUKUS deal can survive, in one form or another, the big shifts brought on by Donald Trump. Australian ministers, from Albanese down, are pretending, or hoping, it can, even as NATO and other Western alliance defence arrangements seem headed for collapse. Some seem to think that the US can maintain a system of alliances around the western Pacific - involving Japan, Korea and Australia - even as European relationships implode. Perhaps, but, whether in the Pacific or the wider world, there cannot be any reversion to the situation before Trump arrived, or the situation after Trump imposed unilateral tariffs on all of his allies. No post-Trump president will be able to pretend that nothing happened during the Trump Reich, and that normal service can quickly be resumed. Trump has fractured the Bretton Woods system of international trade - what Richard Marles insists on calling "a rules-based international order" long after the game has changed. He has repudiated much of the web of relationships around Europe and the Middle East, particularly over the future of Ukraine. The value of American guarantees, promises and understandings (including ANZUS and AUKUS) is much diminished, as is the idea of one-in, all-in if someone breaches the peace. And who knows how Israel's adventures into Iran have changed the strategic map of the Middle East. If America is to have its druthers, future trade arrangements between nations will be based on bilateral arrangements, not multinational ones. Alternatively - and more likely - new regional and political alliances will form around multilateral agreements which do not include the United States. The trans-Pacific partnership - quite possibly including China, Canada and Europe - might well be a model. America may make an individualised deal with each nation, but even if it draws back from initial tariffs settings, most nations will see the wisdom of seeking markets anywhere but in the US. For many countries, a primary market will be China, preferred as a buyer or a seller ahead of the unreliable US. Australians can hardly help but be aware that the whole system of our international relationships is changing, and that Australia itself may have little influence on the final wash-up. We are not a big enough player to be invited into all the big-boys' clubs. When the US thinks of its alliances, Australia is not the first country that comes to its mind: we are probably 12th in the queue. To the extent that America-First recognises old obligations, the deals in squaring off the 11 higher in priority will severely pinch what is available to us. It will be worse if the US picks off its "allies" one by one in the manner of the supplicants (Australia included) seeking to negotiate individual deals for themselves. I am always reminded of what a senior American official once said to Margaret Thatcher when, in Washington, she spoke of the bonds of kinship and special relationship. The official said, "Madam, you may be right about this common history and so on, but I assure you that when the US is thinking of its national interest, it thinks of Britain about as often as when Britain, considering its own interest, thinks of the Isle of Wight". Polls show that Australian trust of the US has plummeted. Our distrust of Trump's America is higher than almost any other country, even Canada, and we haven't been threatened with an imperial takeover. A majority rate China as more trustworthy, even in spite of the freeze in relationships and trade sanctions after China was consciously baited by the Morrison government. Other polls show that Australians well understand the difference between a national leader and his policies, and the temper of the general population. But after the Trump election, there is also unease about his constituencies, the authoritarian, even fascist push, the influence in policy of racism, bigotry and anti-immigration feeling and the increasing influence of the Christian fundamentalist right. Much goodwill has evaporated. In contrast, the defence and intelligence establishment has not wavered in preferring the US even to Australia itself. But politicians on both sides of the fence are increasingly conscious that there is no automatic Australian mood to support the US if there were an attack on Taiwan. Nor is there any Australian instinct to see the world through American eyes. National unease is hardly helped by war in the Middle East, the reduction of Gaza and the massacre of its population, by events in Ukraine and by the apparent incapacity of Europe to unite militarily if the US is not an active partner. There is no shortage of information in public forums, much of which is highly critical of the US. Anyone can have a well-informed opinion. But that opinion is hardly being guided by Albanese or the Australian government. Very little is emerging officially canvassing possibilities about what could or should happen. Ministers seem to be denying that anything much is happening. Albanese seems to think that public comment or discussion by official figures should be avoided, lest it cause offence to Trump and inspire or incite some violent reaction. In Canada, Britain, Germany and France, ministers are openly discussing the brave new world. But not here. It is unlikely that Trump or the official US will judge that the comparative silence from Australia means that there is no discussion occurring here. But they may well deduce that the silence from the politicians, and from military and intelligence figures, suggests that the docile ally will not make much fuss. Or that it is unlikely to shift towards our own view of the world, rather than America's. An obvious example might be the American trade war with China, or in making it clear that Australia is not planning on getting involved in any measures to defend Taiwan. But there are also other issues - for example, over the nuclear submarine purchases, or vital US intelligence gathering and command equipment at Pine Gap and elsewhere. Albanese is mouthing polite nothings, other than insisting that he is not about to double our defence spending just because an American media figure-cum Secretary of Defence says we should. Marles, the weakest link in the Australian chain, is a dead letter in any argument, even or particularly when he seems to be parroting a position that has originated in the US. It cannot be expected that significant change to the relationship will occur only incrementally. Or that it will evolve naturally from events in the control of others. Nor can we assume that Albanese, or Marles, or for that matter Penny Wong, have the wit and the speed to shift American opinion. There has not even been any sort of softening-up process. The turning point, perhaps, will be when Albanese finally gets his meeting with Trump. Even there, more likely than not, it will be statements from Trump rather than Albanese to which even Australians will pay most attention. We are not leaving "home". It's the US throwing us out. Albanese, presumably, has rehearsed his reaction to many of the propositions that Trump can be expected to put. He has, after all, put very similar ones to other countries, and he has, additionally, made it quite clear that we are nothing special in his eyes. But Albanese has not confided his strategy or tactics to Parliament, in the media, or in open forums. He has not addressed conferences at which the government's opinions are communicated. What is on the public record, whether in relation to the strategic thinking around AUKUS or Australia's strategic situation generally, is full of waffly words and slogans that could mean anything. Is discussion to be an invitation-only jamboree, or can every parrot in every pet shop have a go? MORE JACK WATERFORD: Could it be that Albanese expects that a matter so vital is to be resolved merely in Cabinet, without any wide public discussion? Or some committee of old Labor warhorses such as Kim Beazley and Stephen Smith? Is there a soldier in the land (or for that matter a spook) to whom the political, social and military problems should be consigned without the popular will being engaged? Is there a place at the table for Paul Keating, Malcolm Turnbull, Gareth Evans or Bob Carr, or any of the third of the electorate who vote, not for Labor nor the Liberals but for parties such as the Greens, the teals, or independents such as David Pocock? Is productivity, for which a conference of insiders is planned, more important than the place of Australia among the nations of the world? One has to hope that Albanese's silence about a time and a place for public discussion and debate is not for want of a plan to engage the population. But so far, on form, one has to expect that he lacks a plan. He has no model for public discussion, and no apparent appetite for it. This could involve reverting to the style of government that he delivered in his first term. Secretive. Unwilling and seemingly unable to communicate with the general public, including those who want Labor to succeed. (Labor is always more awkward, and guilty looking, in consulting its own traditional supporters rather than hostile captains of industry.) Will there be ready but unaccountable access for some special interests, such as the arms industry and the defence establishment? There's an already established pattern of insiders given undue and improper influence, in the same manner as the gambling and liquor crowd and the old media lobbies on other issues. One thing is for sure. No one can say that Albanese has a popular mandate, arising from the landslide election, to do what he wants on such a fundamental change in our circumstances. Defence and foreign affairs scarcely figured in the election, and the two major parties had no disagreements of any substance. No citizen acquired any extra information from any defence debate. It may be true that a debate, if it occurs, will be rancorous. The big vested interests are keen on throwing about claims of being soft on national security and having ambiguous and uncertain loyalties. It could become as unpleasant as the Voice referendum. But that is not a reason for having a secret debate, or no debate at all. This matters too much. Our own sense of identity, culture, history and future are involved. Australia needs to develop an understanding of Australian nationality which has moved on, a bit at least, from when white men flew a flag containing a Union Jack at Gallipoli 110 years ago. It's a debate that embraces Australians whose ancestors were not here at the time of Gallipoli but are in every sense citizens nonetheless. A debate that involves Aboriginal Australians, whose interests were usually ignored while compiling patriotic encomia and pap. A debate involving young Australians who will have to live in a harsher, hotter and more hostile world because of pragmatic decisions made by current politicians on both sides of the fence. It's not for Albo to run Australians inside or out of the arena. Some within a smug party, having won the election more comfortably than anyone expected, have come to think that the election was won by Albanese's calm, patience and political genius. That the very landslide is a refutation of suggestions that first-term Labor was a "disappointment", with an inarticulate leader too timid to go far or fast, or to take ordinary voters into his confidence. Any prime minister who wins a second, or third, term will see it as a vindication of his or her personality, governing style and methods. They will expect that internal and external critics treat them with more respect in future. Particularly for their political skills. One wouldn't want to deprive Albanese of any credit he deserved. But it is just possible that a sizeable proportion of the increased vote for Labor came more from fear of what sort of leadership or policies a MAGA-Down-Under Peter Dutton might have delivered than from enthusiastic re-endorsement of Albanese and his team. Or embrace of Albo's vision - whatever it was - of old alliances, new alliances, and how we trade with, talk with and share with our neighbours. Anthony Albanese is falling back into the sort of bad habits that could bring him down as Labor leader. Despite talking of national conversations about productivity, about tax, and about Australia's sense of itself, he seems to think discussions can take place behind closed doors, with selected participants working off his agenda, and with the general public unable to see, hear, or get even a smell or a taste of what it was all about until it has come to its predetermined conclusion. That's not a way to build a national consensus or a common understanding of how the nation will face the future. While backroom deals and fixes may see him through some of the economic problems, a failure to have a wide consultation could do him great damage when it comes to Australia's reorienting itself to current circumstances in our neighbourhood, and in whatever remains of the Western alliance. It may be that the AUKUS deal can survive, in one form or another, the big shifts brought on by Donald Trump. Australian ministers, from Albanese down, are pretending, or hoping, it can, even as NATO and other Western alliance defence arrangements seem headed for collapse. Some seem to think that the US can maintain a system of alliances around the western Pacific - involving Japan, Korea and Australia - even as European relationships implode. Perhaps, but, whether in the Pacific or the wider world, there cannot be any reversion to the situation before Trump arrived, or the situation after Trump imposed unilateral tariffs on all of his allies. No post-Trump president will be able to pretend that nothing happened during the Trump Reich, and that normal service can quickly be resumed. Trump has fractured the Bretton Woods system of international trade - what Richard Marles insists on calling "a rules-based international order" long after the game has changed. He has repudiated much of the web of relationships around Europe and the Middle East, particularly over the future of Ukraine. The value of American guarantees, promises and understandings (including ANZUS and AUKUS) is much diminished, as is the idea of one-in, all-in if someone breaches the peace. And who knows how Israel's adventures into Iran have changed the strategic map of the Middle East. If America is to have its druthers, future trade arrangements between nations will be based on bilateral arrangements, not multinational ones. Alternatively - and more likely - new regional and political alliances will form around multilateral agreements which do not include the United States. The trans-Pacific partnership - quite possibly including China, Canada and Europe - might well be a model. America may make an individualised deal with each nation, but even if it draws back from initial tariffs settings, most nations will see the wisdom of seeking markets anywhere but in the US. For many countries, a primary market will be China, preferred as a buyer or a seller ahead of the unreliable US. Australians can hardly help but be aware that the whole system of our international relationships is changing, and that Australia itself may have little influence on the final wash-up. We are not a big enough player to be invited into all the big-boys' clubs. When the US thinks of its alliances, Australia is not the first country that comes to its mind: we are probably 12th in the queue. To the extent that America-First recognises old obligations, the deals in squaring off the 11 higher in priority will severely pinch what is available to us. It will be worse if the US picks off its "allies" one by one in the manner of the supplicants (Australia included) seeking to negotiate individual deals for themselves. I am always reminded of what a senior American official once said to Margaret Thatcher when, in Washington, she spoke of the bonds of kinship and special relationship. The official said, "Madam, you may be right about this common history and so on, but I assure you that when the US is thinking of its national interest, it thinks of Britain about as often as when Britain, considering its own interest, thinks of the Isle of Wight". Polls show that Australian trust of the US has plummeted. Our distrust of Trump's America is higher than almost any other country, even Canada, and we haven't been threatened with an imperial takeover. A majority rate China as more trustworthy, even in spite of the freeze in relationships and trade sanctions after China was consciously baited by the Morrison government. Other polls show that Australians well understand the difference between a national leader and his policies, and the temper of the general population. But after the Trump election, there is also unease about his constituencies, the authoritarian, even fascist push, the influence in policy of racism, bigotry and anti-immigration feeling and the increasing influence of the Christian fundamentalist right. Much goodwill has evaporated. In contrast, the defence and intelligence establishment has not wavered in preferring the US even to Australia itself. But politicians on both sides of the fence are increasingly conscious that there is no automatic Australian mood to support the US if there were an attack on Taiwan. Nor is there any Australian instinct to see the world through American eyes. National unease is hardly helped by war in the Middle East, the reduction of Gaza and the massacre of its population, by events in Ukraine and by the apparent incapacity of Europe to unite militarily if the US is not an active partner. There is no shortage of information in public forums, much of which is highly critical of the US. Anyone can have a well-informed opinion. But that opinion is hardly being guided by Albanese or the Australian government. Very little is emerging officially canvassing possibilities about what could or should happen. Ministers seem to be denying that anything much is happening. Albanese seems to think that public comment or discussion by official figures should be avoided, lest it cause offence to Trump and inspire or incite some violent reaction. In Canada, Britain, Germany and France, ministers are openly discussing the brave new world. But not here. It is unlikely that Trump or the official US will judge that the comparative silence from Australia means that there is no discussion occurring here. But they may well deduce that the silence from the politicians, and from military and intelligence figures, suggests that the docile ally will not make much fuss. Or that it is unlikely to shift towards our own view of the world, rather than America's. An obvious example might be the American trade war with China, or in making it clear that Australia is not planning on getting involved in any measures to defend Taiwan. But there are also other issues - for example, over the nuclear submarine purchases, or vital US intelligence gathering and command equipment at Pine Gap and elsewhere. Albanese is mouthing polite nothings, other than insisting that he is not about to double our defence spending just because an American media figure-cum Secretary of Defence says we should. Marles, the weakest link in the Australian chain, is a dead letter in any argument, even or particularly when he seems to be parroting a position that has originated in the US. It cannot be expected that significant change to the relationship will occur only incrementally. Or that it will evolve naturally from events in the control of others. Nor can we assume that Albanese, or Marles, or for that matter Penny Wong, have the wit and the speed to shift American opinion. There has not even been any sort of softening-up process. The turning point, perhaps, will be when Albanese finally gets his meeting with Trump. Even there, more likely than not, it will be statements from Trump rather than Albanese to which even Australians will pay most attention. We are not leaving "home". It's the US throwing us out. Albanese, presumably, has rehearsed his reaction to many of the propositions that Trump can be expected to put. He has, after all, put very similar ones to other countries, and he has, additionally, made it quite clear that we are nothing special in his eyes. But Albanese has not confided his strategy or tactics to Parliament, in the media, or in open forums. He has not addressed conferences at which the government's opinions are communicated. What is on the public record, whether in relation to the strategic thinking around AUKUS or Australia's strategic situation generally, is full of waffly words and slogans that could mean anything. Is discussion to be an invitation-only jamboree, or can every parrot in every pet shop have a go? MORE JACK WATERFORD: Could it be that Albanese expects that a matter so vital is to be resolved merely in Cabinet, without any wide public discussion? Or some committee of old Labor warhorses such as Kim Beazley and Stephen Smith? Is there a soldier in the land (or for that matter a spook) to whom the political, social and military problems should be consigned without the popular will being engaged? Is there a place at the table for Paul Keating, Malcolm Turnbull, Gareth Evans or Bob Carr, or any of the third of the electorate who vote, not for Labor nor the Liberals but for parties such as the Greens, the teals, or independents such as David Pocock? Is productivity, for which a conference of insiders is planned, more important than the place of Australia among the nations of the world? One has to hope that Albanese's silence about a time and a place for public discussion and debate is not for want of a plan to engage the population. But so far, on form, one has to expect that he lacks a plan. He has no model for public discussion, and no apparent appetite for it. This could involve reverting to the style of government that he delivered in his first term. Secretive. Unwilling and seemingly unable to communicate with the general public, including those who want Labor to succeed. (Labor is always more awkward, and guilty looking, in consulting its own traditional supporters rather than hostile captains of industry.) Will there be ready but unaccountable access for some special interests, such as the arms industry and the defence establishment? There's an already established pattern of insiders given undue and improper influence, in the same manner as the gambling and liquor crowd and the old media lobbies on other issues. One thing is for sure. No one can say that Albanese has a popular mandate, arising from the landslide election, to do what he wants on such a fundamental change in our circumstances. Defence and foreign affairs scarcely figured in the election, and the two major parties had no disagreements of any substance. No citizen acquired any extra information from any defence debate. It may be true that a debate, if it occurs, will be rancorous. The big vested interests are keen on throwing about claims of being soft on national security and having ambiguous and uncertain loyalties. It could become as unpleasant as the Voice referendum. But that is not a reason for having a secret debate, or no debate at all. This matters too much. Our own sense of identity, culture, history and future are involved. Australia needs to develop an understanding of Australian nationality which has moved on, a bit at least, from when white men flew a flag containing a Union Jack at Gallipoli 110 years ago. It's a debate that embraces Australians whose ancestors were not here at the time of Gallipoli but are in every sense citizens nonetheless. A debate that involves Aboriginal Australians, whose interests were usually ignored while compiling patriotic encomia and pap. A debate involving young Australians who will have to live in a harsher, hotter and more hostile world because of pragmatic decisions made by current politicians on both sides of the fence. It's not for Albo to run Australians inside or out of the arena. Some within a smug party, having won the election more comfortably than anyone expected, have come to think that the election was won by Albanese's calm, patience and political genius. That the very landslide is a refutation of suggestions that first-term Labor was a "disappointment", with an inarticulate leader too timid to go far or fast, or to take ordinary voters into his confidence. Any prime minister who wins a second, or third, term will see it as a vindication of his or her personality, governing style and methods. They will expect that internal and external critics treat them with more respect in future. Particularly for their political skills. One wouldn't want to deprive Albanese of any credit he deserved. But it is just possible that a sizeable proportion of the increased vote for Labor came more from fear of what sort of leadership or policies a MAGA-Down-Under Peter Dutton might have delivered than from enthusiastic re-endorsement of Albanese and his team. Or embrace of Albo's vision - whatever it was - of old alliances, new alliances, and how we trade with, talk with and share with our neighbours. Anthony Albanese is falling back into the sort of bad habits that could bring him down as Labor leader. Despite talking of national conversations about productivity, about tax, and about Australia's sense of itself, he seems to think discussions can take place behind closed doors, with selected participants working off his agenda, and with the general public unable to see, hear, or get even a smell or a taste of what it was all about until it has come to its predetermined conclusion. That's not a way to build a national consensus or a common understanding of how the nation will face the future. While backroom deals and fixes may see him through some of the economic problems, a failure to have a wide consultation could do him great damage when it comes to Australia's reorienting itself to current circumstances in our neighbourhood, and in whatever remains of the Western alliance. It may be that the AUKUS deal can survive, in one form or another, the big shifts brought on by Donald Trump. Australian ministers, from Albanese down, are pretending, or hoping, it can, even as NATO and other Western alliance defence arrangements seem headed for collapse. Some seem to think that the US can maintain a system of alliances around the western Pacific - involving Japan, Korea and Australia - even as European relationships implode. Perhaps, but, whether in the Pacific or the wider world, there cannot be any reversion to the situation before Trump arrived, or the situation after Trump imposed unilateral tariffs on all of his allies. No post-Trump president will be able to pretend that nothing happened during the Trump Reich, and that normal service can quickly be resumed. Trump has fractured the Bretton Woods system of international trade - what Richard Marles insists on calling "a rules-based international order" long after the game has changed. He has repudiated much of the web of relationships around Europe and the Middle East, particularly over the future of Ukraine. The value of American guarantees, promises and understandings (including ANZUS and AUKUS) is much diminished, as is the idea of one-in, all-in if someone breaches the peace. And who knows how Israel's adventures into Iran have changed the strategic map of the Middle East. If America is to have its druthers, future trade arrangements between nations will be based on bilateral arrangements, not multinational ones. Alternatively - and more likely - new regional and political alliances will form around multilateral agreements which do not include the United States. The trans-Pacific partnership - quite possibly including China, Canada and Europe - might well be a model. America may make an individualised deal with each nation, but even if it draws back from initial tariffs settings, most nations will see the wisdom of seeking markets anywhere but in the US. For many countries, a primary market will be China, preferred as a buyer or a seller ahead of the unreliable US. Australians can hardly help but be aware that the whole system of our international relationships is changing, and that Australia itself may have little influence on the final wash-up. We are not a big enough player to be invited into all the big-boys' clubs. When the US thinks of its alliances, Australia is not the first country that comes to its mind: we are probably 12th in the queue. To the extent that America-First recognises old obligations, the deals in squaring off the 11 higher in priority will severely pinch what is available to us. It will be worse if the US picks off its "allies" one by one in the manner of the supplicants (Australia included) seeking to negotiate individual deals for themselves. I am always reminded of what a senior American official once said to Margaret Thatcher when, in Washington, she spoke of the bonds of kinship and special relationship. The official said, "Madam, you may be right about this common history and so on, but I assure you that when the US is thinking of its national interest, it thinks of Britain about as often as when Britain, considering its own interest, thinks of the Isle of Wight". Polls show that Australian trust of the US has plummeted. Our distrust of Trump's America is higher than almost any other country, even Canada, and we haven't been threatened with an imperial takeover. A majority rate China as more trustworthy, even in spite of the freeze in relationships and trade sanctions after China was consciously baited by the Morrison government. Other polls show that Australians well understand the difference between a national leader and his policies, and the temper of the general population. But after the Trump election, there is also unease about his constituencies, the authoritarian, even fascist push, the influence in policy of racism, bigotry and anti-immigration feeling and the increasing influence of the Christian fundamentalist right. Much goodwill has evaporated. In contrast, the defence and intelligence establishment has not wavered in preferring the US even to Australia itself. But politicians on both sides of the fence are increasingly conscious that there is no automatic Australian mood to support the US if there were an attack on Taiwan. Nor is there any Australian instinct to see the world through American eyes. National unease is hardly helped by war in the Middle East, the reduction of Gaza and the massacre of its population, by events in Ukraine and by the apparent incapacity of Europe to unite militarily if the US is not an active partner. There is no shortage of information in public forums, much of which is highly critical of the US. Anyone can have a well-informed opinion. But that opinion is hardly being guided by Albanese or the Australian government. Very little is emerging officially canvassing possibilities about what could or should happen. Ministers seem to be denying that anything much is happening. Albanese seems to think that public comment or discussion by official figures should be avoided, lest it cause offence to Trump and inspire or incite some violent reaction. In Canada, Britain, Germany and France, ministers are openly discussing the brave new world. But not here. It is unlikely that Trump or the official US will judge that the comparative silence from Australia means that there is no discussion occurring here. But they may well deduce that the silence from the politicians, and from military and intelligence figures, suggests that the docile ally will not make much fuss. Or that it is unlikely to shift towards our own view of the world, rather than America's. An obvious example might be the American trade war with China, or in making it clear that Australia is not planning on getting involved in any measures to defend Taiwan. But there are also other issues - for example, over the nuclear submarine purchases, or vital US intelligence gathering and command equipment at Pine Gap and elsewhere. Albanese is mouthing polite nothings, other than insisting that he is not about to double our defence spending just because an American media figure-cum Secretary of Defence says we should. Marles, the weakest link in the Australian chain, is a dead letter in any argument, even or particularly when he seems to be parroting a position that has originated in the US. It cannot be expected that significant change to the relationship will occur only incrementally. Or that it will evolve naturally from events in the control of others. Nor can we assume that Albanese, or Marles, or for that matter Penny Wong, have the wit and the speed to shift American opinion. There has not even been any sort of softening-up process. The turning point, perhaps, will be when Albanese finally gets his meeting with Trump. Even there, more likely than not, it will be statements from Trump rather than Albanese to which even Australians will pay most attention. We are not leaving "home". It's the US throwing us out. Albanese, presumably, has rehearsed his reaction to many of the propositions that Trump can be expected to put. He has, after all, put very similar ones to other countries, and he has, additionally, made it quite clear that we are nothing special in his eyes. But Albanese has not confided his strategy or tactics to Parliament, in the media, or in open forums. He has not addressed conferences at which the government's opinions are communicated. What is on the public record, whether in relation to the strategic thinking around AUKUS or Australia's strategic situation generally, is full of waffly words and slogans that could mean anything. Is discussion to be an invitation-only jamboree, or can every parrot in every pet shop have a go? MORE JACK WATERFORD: Could it be that Albanese expects that a matter so vital is to be resolved merely in Cabinet, without any wide public discussion? Or some committee of old Labor warhorses such as Kim Beazley and Stephen Smith? Is there a soldier in the land (or for that matter a spook) to whom the political, social and military problems should be consigned without the popular will being engaged? Is there a place at the table for Paul Keating, Malcolm Turnbull, Gareth Evans or Bob Carr, or any of the third of the electorate who vote, not for Labor nor the Liberals but for parties such as the Greens, the teals, or independents such as David Pocock? Is productivity, for which a conference of insiders is planned, more important than the place of Australia among the nations of the world? One has to hope that Albanese's silence about a time and a place for public discussion and debate is not for want of a plan to engage the population. But so far, on form, one has to expect that he lacks a plan. He has no model for public discussion, and no apparent appetite for it. This could involve reverting to the style of government that he delivered in his first term. Secretive. Unwilling and seemingly unable to communicate with the general public, including those who want Labor to succeed. (Labor is always more awkward, and guilty looking, in consulting its own traditional supporters rather than hostile captains of industry.) Will there be ready but unaccountable access for some special interests, such as the arms industry and the defence establishment? There's an already established pattern of insiders given undue and improper influence, in the same manner as the gambling and liquor crowd and the old media lobbies on other issues. One thing is for sure. No one can say that Albanese has a popular mandate, arising from the landslide election, to do what he wants on such a fundamental change in our circumstances. Defence and foreign affairs scarcely figured in the election, and the two major parties had no disagreements of any substance. No citizen acquired any extra information from any defence debate. It may be true that a debate, if it occurs, will be rancorous. The big vested interests are keen on throwing about claims of being soft on national security and having ambiguous and uncertain loyalties. It could become as unpleasant as the Voice referendum. But that is not a reason for having a secret debate, or no debate at all. This matters too much. Our own sense of identity, culture, history and future are involved. Australia needs to develop an understanding of Australian nationality which has moved on, a bit at least, from when white men flew a flag containing a Union Jack at Gallipoli 110 years ago. It's a debate that embraces Australians whose ancestors were not here at the time of Gallipoli but are in every sense citizens nonetheless. A debate that involves Aboriginal Australians, whose interests were usually ignored while compiling patriotic encomia and pap. A debate involving young Australians who will have to live in a harsher, hotter and more hostile world because of pragmatic decisions made by current politicians on both sides of the fence. It's not for Albo to run Australians inside or out of the arena. Some within a smug party, having won the election more comfortably than anyone expected, have come to think that the election was won by Albanese's calm, patience and political genius. That the very landslide is a refutation of suggestions that first-term Labor was a "disappointment", with an inarticulate leader too timid to go far or fast, or to take ordinary voters into his confidence. Any prime minister who wins a second, or third, term will see it as a vindication of his or her personality, governing style and methods. They will expect that internal and external critics treat them with more respect in future. Particularly for their political skills. One wouldn't want to deprive Albanese of any credit he deserved. But it is just possible that a sizeable proportion of the increased vote for Labor came more from fear of what sort of leadership or policies a MAGA-Down-Under Peter Dutton might have delivered than from enthusiastic re-endorsement of Albanese and his team. Or embrace of Albo's vision - whatever it was - of old alliances, new alliances, and how we trade with, talk with and share with our neighbours. Anthony Albanese is falling back into the sort of bad habits that could bring him down as Labor leader. Despite talking of national conversations about productivity, about tax, and about Australia's sense of itself, he seems to think discussions can take place behind closed doors, with selected participants working off his agenda, and with the general public unable to see, hear, or get even a smell or a taste of what it was all about until it has come to its predetermined conclusion. That's not a way to build a national consensus or a common understanding of how the nation will face the future. While backroom deals and fixes may see him through some of the economic problems, a failure to have a wide consultation could do him great damage when it comes to Australia's reorienting itself to current circumstances in our neighbourhood, and in whatever remains of the Western alliance. It may be that the AUKUS deal can survive, in one form or another, the big shifts brought on by Donald Trump. Australian ministers, from Albanese down, are pretending, or hoping, it can, even as NATO and other Western alliance defence arrangements seem headed for collapse. Some seem to think that the US can maintain a system of alliances around the western Pacific - involving Japan, Korea and Australia - even as European relationships implode. Perhaps, but, whether in the Pacific or the wider world, there cannot be any reversion to the situation before Trump arrived, or the situation after Trump imposed unilateral tariffs on all of his allies. No post-Trump president will be able to pretend that nothing happened during the Trump Reich, and that normal service can quickly be resumed. Trump has fractured the Bretton Woods system of international trade - what Richard Marles insists on calling "a rules-based international order" long after the game has changed. He has repudiated much of the web of relationships around Europe and the Middle East, particularly over the future of Ukraine. The value of American guarantees, promises and understandings (including ANZUS and AUKUS) is much diminished, as is the idea of one-in, all-in if someone breaches the peace. And who knows how Israel's adventures into Iran have changed the strategic map of the Middle East. If America is to have its druthers, future trade arrangements between nations will be based on bilateral arrangements, not multinational ones. Alternatively - and more likely - new regional and political alliances will form around multilateral agreements which do not include the United States. The trans-Pacific partnership - quite possibly including China, Canada and Europe - might well be a model. America may make an individualised deal with each nation, but even if it draws back from initial tariffs settings, most nations will see the wisdom of seeking markets anywhere but in the US. For many countries, a primary market will be China, preferred as a buyer or a seller ahead of the unreliable US. Australians can hardly help but be aware that the whole system of our international relationships is changing, and that Australia itself may have little influence on the final wash-up. We are not a big enough player to be invited into all the big-boys' clubs. When the US thinks of its alliances, Australia is not the first country that comes to its mind: we are probably 12th in the queue. To the extent that America-First recognises old obligations, the deals in squaring off the 11 higher in priority will severely pinch what is available to us. It will be worse if the US picks off its "allies" one by one in the manner of the supplicants (Australia included) seeking to negotiate individual deals for themselves. I am always reminded of what a senior American official once said to Margaret Thatcher when, in Washington, she spoke of the bonds of kinship and special relationship. The official said, "Madam, you may be right about this common history and so on, but I assure you that when the US is thinking of its national interest, it thinks of Britain about as often as when Britain, considering its own interest, thinks of the Isle of Wight". Polls show that Australian trust of the US has plummeted. Our distrust of Trump's America is higher than almost any other country, even Canada, and we haven't been threatened with an imperial takeover. A majority rate China as more trustworthy, even in spite of the freeze in relationships and trade sanctions after China was consciously baited by the Morrison government. Other polls show that Australians well understand the difference between a national leader and his policies, and the temper of the general population. But after the Trump election, there is also unease about his constituencies, the authoritarian, even fascist push, the influence in policy of racism, bigotry and anti-immigration feeling and the increasing influence of the Christian fundamentalist right. Much goodwill has evaporated. In contrast, the defence and intelligence establishment has not wavered in preferring the US even to Australia itself. But politicians on both sides of the fence are increasingly conscious that there is no automatic Australian mood to support the US if there were an attack on Taiwan. Nor is there any Australian instinct to see the world through American eyes. National unease is hardly helped by war in the Middle East, the reduction of Gaza and the massacre of its population, by events in Ukraine and by the apparent incapacity of Europe to unite militarily if the US is not an active partner. There is no shortage of information in public forums, much of which is highly critical of the US. Anyone can have a well-informed opinion. But that opinion is hardly being guided by Albanese or the Australian government. Very little is emerging officially canvassing possibilities about what could or should happen. Ministers seem to be denying that anything much is happening. Albanese seems to think that public comment or discussion by official figures should be avoided, lest it cause offence to Trump and inspire or incite some violent reaction. In Canada, Britain, Germany and France, ministers are openly discussing the brave new world. But not here. It is unlikely that Trump or the official US will judge that the comparative silence from Australia means that there is no discussion occurring here. But they may well deduce that the silence from the politicians, and from military and intelligence figures, suggests that the docile ally will not make much fuss. Or that it is unlikely to shift towards our own view of the world, rather than America's. An obvious example might be the American trade war with China, or in making it clear that Australia is not planning on getting involved in any measures to defend Taiwan. But there are also other issues - for example, over the nuclear submarine purchases, or vital US intelligence gathering and command equipment at Pine Gap and elsewhere. Albanese is mouthing polite nothings, other than insisting that he is not about to double our defence spending just because an American media figure-cum Secretary of Defence says we should. Marles, the weakest link in the Australian chain, is a dead letter in any argument, even or particularly when he seems to be parroting a position that has originated in the US. It cannot be expected that significant change to the relationship will occur only incrementally. Or that it will evolve naturally from events in the control of others. Nor can we assume that Albanese, or Marles, or for that matter Penny Wong, have the wit and the speed to shift American opinion. There has not even been any sort of softening-up process. The turning point, perhaps, will be when Albanese finally gets his meeting with Trump. Even there, more likely than not, it will be statements from Trump rather than Albanese to which even Australians will pay most attention. We are not leaving "home". It's the US throwing us out. Albanese, presumably, has rehearsed his reaction to many of the propositions that Trump can be expected to put. He has, after all, put very similar ones to other countries, and he has, additionally, made it quite clear that we are nothing special in his eyes. But Albanese has not confided his strategy or tactics to Parliament, in the media, or in open forums. He has not addressed conferences at which the government's opinions are communicated. What is on the public record, whether in relation to the strategic thinking around AUKUS or Australia's strategic situation generally, is full of waffly words and slogans that could mean anything. Is discussion to be an invitation-only jamboree, or can every parrot in every pet shop have a go? MORE JACK WATERFORD: Could it be that Albanese expects that a matter so vital is to be resolved merely in Cabinet, without any wide public discussion? Or some committee of old Labor warhorses such as Kim Beazley and Stephen Smith? Is there a soldier in the land (or for that matter a spook) to whom the political, social and military problems should be consigned without the popular will being engaged? Is there a place at the table for Paul Keating, Malcolm Turnbull, Gareth Evans or Bob Carr, or any of the third of the electorate who vote, not for Labor nor the Liberals but for parties such as the Greens, the teals, or independents such as David Pocock? Is productivity, for which a conference of insiders is planned, more important than the place of Australia among the nations of the world? One has to hope that Albanese's silence about a time and a place for public discussion and debate is not for want of a plan to engage the population. But so far, on form, one has to expect that he lacks a plan. He has no model for public discussion, and no apparent appetite for it. This could involve reverting to the style of government that he delivered in his first term. Secretive. Unwilling and seemingly unable to communicate with the general public, including those who want Labor to succeed. (Labor is always more awkward, and guilty looking, in consulting its own traditional supporters rather than hostile captains of industry.) Will there be ready but unaccountable access for some special interests, such as the arms industry and the defence establishment? There's an already established pattern of insiders given undue and improper influence, in the same manner as the gambling and liquor crowd and the old media lobbies on other issues. One thing is for sure. No one can say that Albanese has a popular mandate, arising from the landslide election, to do what he wants on such a fundamental change in our circumstances. Defence and foreign affairs scarcely figured in the election, and the two major parties had no disagreements of any substance. No citizen acquired any extra information from any defence debate. It may be true that a debate, if it occurs, will be rancorous. The big vested interests are keen on throwing about claims of being soft on national security and having ambiguous and uncertain loyalties. It could become as unpleasant as the Voice referendum. But that is not a reason for having a secret debate, or no debate at all. This matters too much. Our own sense of identity, culture, history and future are involved. Australia needs to develop an understanding of Australian nationality which has moved on, a bit at least, from when white men flew a flag containing a Union Jack at Gallipoli 110 years ago. It's a debate that embraces Australians whose ancestors were not here at the time of Gallipoli but are in every sense citizens nonetheless. A debate that involves Aboriginal Australians, whose interests were usually ignored while compiling patriotic encomia and pap. A debate involving young Australians who will have to live in a harsher, hotter and more hostile world because of pragmatic decisions made by current politicians on both sides of the fence. It's not for Albo to run Australians inside or out of the arena. Some within a smug party, having won the election more comfortably than anyone expected, have come to think that the election was won by Albanese's calm, patience and political genius. That the very landslide is a refutation of suggestions that first-term Labor was a "disappointment", with an inarticulate leader too timid to go far or fast, or to take ordinary voters into his confidence. Any prime minister who wins a second, or third, term will see it as a vindication of his or her personality, governing style and methods. They will expect that internal and external critics treat them with more respect in future. Particularly for their political skills. One wouldn't want to deprive Albanese of any credit he deserved. But it is just possible that a sizeable proportion of the increased vote for Labor came more from fear of what sort of leadership or policies a MAGA-Down-Under Peter Dutton might have delivered than from enthusiastic re-endorsement of Albanese and his team. Or embrace of Albo's vision - whatever it was - of old alliances, new alliances, and how we trade with, talk with and share with our neighbours.

The Age

4 hours ago

• The Age

Australia an energy target as Iran-Israeli war triggers global turmoil

'In the worst-case scenario in which the Strait of Hormuz is closed, it will affect both global LNG and oil markets by up to 20 per cent of their respective annual consumption,' Citi energy analysts said this week. 'Global LNG markets will be more vulnerable than oil to further escalation of Middle East tensions.' These Middle East petro states may be underpinned by oil sales, but LNG gives them much-needed diversification. And LNG assets far away from the region give them pricing and supply upside from any energy price spikes triggered by these conflicts and any related supply shocks. Santos could not be more tempting from a strategic point of view. It would give XRG a business far from the drama of the Middle East thanks to its assets in Australia, Papua New Guinea and Alaska and close to Santos' coveted Asian customers, which have a fast-growing appetite for LNG. And what would the Santos suitors make of Australia's comical industry, where operators get a lot of their gas royalty-free from Australians and then make a fortune selling it back to them as global prices surge? Santos is not the only local energy giant making a splash among the oil giants. Loading Woodside Petroleum boss Meg O'Neill was part of the Trump entourage on his recent trip through the Middle East. She signed up Saudi Aramco, the world's largest oil and gas producer, as a partner for Woodside's US projects. She was almost the only female in a group photo with Trump and Saudi Crown Prince Mohammed bin Salman. She was quoted in the official White House press release. 'Woodside and Aramco will explore global opportunities, including Aramco's potential acquisition of an equity interest in an LNG offtake from the Louisiana LNG project as well as exploring opportunities for a potential collaboration in lower-carbon ammonia,' she said. 'Lower-carbon' is the other major reason why these petro states are now pouring more money into LNG developments than oil. Loading Even the petro states realise LNG will have a longer shelf life than oil as the alleged 'transition fuel' to a green energy future. China's total crude oil consumption dropped last year and developing nations are expected to follow as they adopt the flood of cheap EVs China is churning out. But the future of the Santos bid is as uncertain as the outcome of the Israel/Iran conflict. The XRG consortium is conducting due diligence, and as both sides are cautioning, there is no certainty that a formal offer will emerge. Loading More importantly, there are many regulatory hurdles, including government approval if a concrete offer does emerge for what is a critical piece of Australian infrastructure. The issue of domestic gas reservation, to prevent taxpayers and local businesses from getting screwed by companies supplying Australia its own gas, will be an interesting part of any takeover negotiations, especially since Santos already supplies gas domestically. The fact that Santos is trading at something close to a $5 billion discount to the $30 billion cash being offered for its shares tells you plenty about how cautious the market is about the potential success of this deal.