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Speaker 1: Bloomberg Audio Studios, podcasts, radio news. This is the Bloomberg

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Speaker 1: Daybreak Europe podcast. Good morning, It's Tuesday, the tenth of March.

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Speaker 1: I'm Stephen Carrolin Brussels. Coming up today. The Iran war

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Speaker 1: will end very soon. The US President Donald Trump seeks

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Speaker 1: to cool market and political pressure as the conflict continues.

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Speaker 1: Oil prices tumble as traders caution that Donald Trump's reassurance

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Speaker 1: won't be enough to get tankers moving. Plus inflated problems,

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Speaker 1: governments and central banks try to assess the impact of

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Speaker 1: the ongoing war on their economies. That start with a

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Speaker 1: roundup of our top stories. Eleven days into the war

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Speaker 1: with around, the US President Donald Trump says he now

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Speaker 1: believes the conflict will end very soon. Speaking in Florida,

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Speaker 1: he added that he does not expect hostilities to end

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Speaker 1: this week, but that the US operation was ahead of

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Speaker 1: schedule very soon.

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Speaker 2: Look, everything they have is gone, including their leadership. Fact

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Speaker 2: two levels of leadership, and even actually, as it turns out,

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Speaker 2: more than that, but two levels of leadership are gone.

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Speaker 1: US officials have repeatedly insisted they can sustain the conflict indefinitely. However,

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Speaker 1: Trump's remarks signaled a desire to show that American involvement

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Speaker 1: will not be open ended. At a separate event, the

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Speaker 1: President acknowledged that there are still unanswered questions surrounding leadership

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Speaker 1: in Tehran.

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Speaker 2: Think of it. We had leaders and they're gone. Though

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Speaker 2: we have new leaders and they're gone, and now nobody

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Speaker 2: has any idea who the people are that are going

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Speaker 2: to be there of the country.

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Speaker 1: The comments underscored the challenges ahead for Trump, who will

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Speaker 1: need to reconcile his promises of total victory with the

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Speaker 1: consequences of continuing the war. More than one thousand, three

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Speaker 1: hundred Iranians have died in the war so far, according

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Speaker 1: to an official toll that has not been updated for

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Speaker 1: several days. Some four hundred and eighty six people have

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Speaker 1: died and Israeli strikes in Lebanon. According to the country's

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Speaker 1: health ministry, six people have died in the UAE, while

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Speaker 1: several deaths have been reported in other Gulf countries. There

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Speaker 1: have been seven American casualties and at least eleven Israeli

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Speaker 1: deaths reported. Oil price has plunged more than ten percent

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Speaker 1: after President Trump's suggestion that the war would end soon.

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Speaker 1: In a further bid to steady markets. Trump said the

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Speaker 1: US Navy would escort tankers through the Strait of Hormoz

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Speaker 1: and that Washington would waive certain oil related sanctions. His

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Speaker 1: remarks followed comments from the EU Economy Commissioner Valdestan Brovskis,

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Speaker 1: who said the US had told its G seven partners

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Speaker 1: that any sanctions relief for Russia would be temporary. Even

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Speaker 1: with those steps, Eric van nostr And, CIO at Lazard

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Speaker 1: Asset Management, said crude remains significantly higher than pre war levels.

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Speaker 3: Oil markets might feel good today because they ease off

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Speaker 3: the highs we saw earlier in the earlier in the

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Speaker 3: US training session, but we're still in one of the

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Speaker 3: bigger oil shops in the past couple of years.

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Speaker 1: Eric van nostro And also cautions that Trump's press conferences

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Speaker 1: have not been a reliable guide to US policy in

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Speaker 1: the past. The President did not provide further details on

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Speaker 1: the tanker escort plan or this scope of sanctions relief,

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Speaker 1: beyond saying that he had discussed the issue with Russian

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Speaker 1: President Vladimir Putin in a phone call earlier on Monday.

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Speaker 1: Well Meanwhile, Vladimir Putin has urged his country's oil and

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Speaker 1: gas producers to take advantage of higher prices because the

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Speaker 1: spike will be temporary. He told a meeting of energy

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Speaker 1: executives they should use the additional export revenue to reduce

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Speaker 1: their debts to Russian banks. It came as Putin and

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Speaker 1: Donald Trump spoke for the first time this year. They

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Speaker 1: discussed the war in Iran, as well as Venezuela and

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Speaker 1: the US led peace talks between Russia and Ukraine. His

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Speaker 1: Spoomberg reporter Michael Heath, Russia, of.

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Speaker 4: Course is in a prime seat here because it remains

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Speaker 4: sort of semi ellied to Iran, yet it's been courted

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Speaker 4: by the US president. In a sense, Russia is sort

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Speaker 4: of in this swing position of winning whichever where it turns.

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Speaker 1: Spoomberg's Michael Heath. A planned round of peace talks with

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Speaker 1: Ukraine last week was postponed due to the war in Iran,

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Speaker 1: with neither side indicating when they will resume. Airlines are

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Speaker 1: reviewing their growth plans as they consider how travel demand

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Speaker 1: and fuel costs are being affected by the war. Bloombergo

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Speaker 1: The stands that planemakers and aircraft leasing firms are worried

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Speaker 1: that some of their customers may push back deals for

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Speaker 1: new jets. Sources have told us that some Gulf and

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Speaker 1: Asian carriers have put discussions on plane purchases and leasing

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Speaker 1: on hold as they assess the financial impact of the conflict.

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Speaker 1: John Pearson, the CEO of international courier service DHL Express,

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Speaker 1: has told Bloomberg his firm is prepared for any change

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Speaker 1: in oil prices.

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Speaker 2: We have a very established fuel surcharge mechanism that aligns

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Speaker 2: itself with oil price as that goes up and down.

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Speaker 2: Has been a recognized standard within the industry for twenty

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Speaker 2: or if not thirty years. It's very transparently communicated on

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Speaker 2: our website to our customers. Our customers are very familiar

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Speaker 2: with it, so we ride these waves of oil prices every.

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Speaker 1: Day, DHL expresses John Pearson there speaking earlier this morning,

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Speaker 1: Jeffreys says Boeing is especially exposed to the Middle EA

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Speaker 1: for almost half of the orders for its upcoming seven

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Speaker 1: seven seven X jet and a third of the seven

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Speaker 1: eight seven Dreamliner purchases from carriers in the region. The

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Speaker 1: Bank of England is facing the prospect of UK inflation

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Speaker 1: rebounding rapidly due to higher oil prices. A range of

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Speaker 1: economists ce CPI jumping to between three and five percent,

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Speaker 1: depending on where oil settles. Bloomberg Exchange Wilcock has more

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Speaker 1: sixty six dollars a barrel. That was the spot's oil

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Speaker 1: price back in February. The Bank of England last met

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Speaker 1: then and they thought it would broadly stay that way,

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Speaker 1: but the volatility of the past week has called that

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Speaker 1: into question. Bloomberg Economics estimate if prices linger around at

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Speaker 1: one hundred dollars a barrel and end the year at eighty,

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Speaker 1: that would push inflation up nearly one whole percentage point.

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Speaker 1: That in turn would have a major effect on both

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Speaker 1: guilts and UK mortgages, would likely put the government in

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Speaker 1: economic hot water. In the meantime, many assume the bank

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Speaker 1: will be cautious about any further cuts when it meets

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Speaker 1: next week, given how burned they were from the previous

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Speaker 1: energy price surge in London. James Wilcock Bloomberg Radio's just

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Speaker 1: an invasion of Ukraine added to the problems for the

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Speaker 1: commercial real estate market. Investors are facing up to another

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Speaker 1: headwind for the sector. Bloomberg's Euan Parts has more.

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Speaker 5: It's an industry with valuations that are hyper sensitive to

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Speaker 5: interest rates, so the war in the Middle East, which

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Speaker 5: has spite energy prices and therefore rate increase expectations, is

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Speaker 5: a serious headwind for commercial real estate. It's a tricky

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Speaker 5: backshot for the industry as key players gather in can

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Speaker 5: for the mip In Property Conference. The year started with

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Speaker 5: signs of optimism the bigger deals might be back on

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Speaker 5: the horizon after a sustained hiatus. But two months into

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Speaker 5: twenty twenty six and it seems the industry has another

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Speaker 5: new problem to deal with.

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Speaker 1: In London, I'm you in pots of Bloomberg Radio and

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Speaker 1: those are your top stories on the markets. The oil

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Speaker 1: price is lower this morning, six point four percent for

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Speaker 1: Brown crewed ninety two dollars and four two cents a

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Speaker 1: barrel at the moment. WTI is down below eighty nine

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Speaker 1: dollars a barrel as well. The MSCI is Specific Index

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Speaker 1: up by three tenths, actually be up by three percent

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Speaker 1: this morning after yesterday's seal off. Eurostox fifty features are

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Speaker 1: one point three percent higher, bobook dollars. Spot out At

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Speaker 1: index is a tenth of one percent weaker. And I'll

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Speaker 1: just mention the earnings out of Saudi Aramco this morning,

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Speaker 1: announcing a three billion dollar share buyback program and raising

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Speaker 1: its dividend. Investors of course, focused on how the company

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Speaker 1: weather's the impact of the war in the Middle East.

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Speaker 1: It's been rushing to reroot some exports as the Strait

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Speaker 1: of Wamus remains at a standstill. As well, it's been

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Speaker 1: pairing back output to because of fuller storage tanks and

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Speaker 1: shut the biggest refinery in Saudi Arabia following a drone

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Speaker 1: attack as well. So those earnings of interest from Saudi Aramco.

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Speaker 1: This morning. In a moment, we'll bring you more on

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Speaker 1: why Donald Trump's comments on the Iran war giving markets

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Speaker 1: pause for thought, Plus do we still need to be

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Speaker 1: worried about the conflict driving up inflation around the world.

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Speaker 1: But first on a story that caught a eye this

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Speaker 1: morning reflecting a wild day in markets. Bloomberg Opinions. John

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Speaker 1: Authors has been writing about the remarkable moves that we

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Speaker 1: saw on oil prices yesterday, surging to almost one hundred

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Speaker 1: and twenty dollars before swinging back below one hundred dollars

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Speaker 1: by the end of the day. And despite the volley

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Speaker 1: of headlines, John writes that it's impossible to explain all

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Speaker 1: of the moves just with what the developments of recent days. Sentiment,

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Speaker 1: he says, plays a big part too, and some traders,

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Speaker 1: he writes, were evidently willing to panic, but it's equally

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Speaker 1: true that they weren't comfortable leaving oil above the landmark

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Speaker 1: of one hundred dollars. So he concludes that enough cool

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Speaker 1: heads are prevailing, at least for now. Of course, the

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Speaker 1: longer that the straight up war moves is closed, the

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Speaker 1: more challenging that might be as well. And if you

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Speaker 1: wanted a lighter take on some of this too, John's pieces,

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Speaker 1: as usual come with the playlist, and he actually points

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Speaker 1: out there are relatively few songs about oil that you

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Speaker 1: can find. He hasn't picked out a few, though. You'll

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Speaker 1: find that piece of Bloomberg opinion, and we'll put a

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Speaker 1: link to it on our podcast show notes as well.

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Speaker 6: Well.

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Speaker 1: Let's bring it up today then, with events in the

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Speaker 1: Middle East, markets appears to have been calmed by the

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Speaker 1: US President's latest comments on the Iran war our Middle

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Speaker 1: East managing after Paul Wallace joins US Now for more so, Paul,

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Speaker 1: we have seen oil prices come down after Donald Trump

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Speaker 1: said that he believes the war will end very soon.

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Speaker 7: Does that look likely? Hi, Stephen. You know, in some

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Speaker 7: ways it depends on what Trump wants. I mean, yeah,

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Speaker 7: he could end it very soon if he decided that

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Speaker 7: the US had done enough to achieve its goals, and

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Speaker 7: presumably that it had done enough for him to be

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Speaker 7: able to sell a victory to the American public. I

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Speaker 7: think that latter point is extremely important for him, given

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Speaker 7: all the sort of chaos that this war has caused

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Speaker 7: in the Middle East and in global financial markets. So yeah,

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Speaker 7: if he decides that, you know, he's not going to

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Speaker 7: go for regime change anymore, that he will stick to

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Speaker 7: pure military aims, such as severely degrading Iran's ballistic missile

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Speaker 7: and drone capability and naval capability, then yes, he could

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Speaker 7: end it very soon, or at least take it to

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Speaker 7: the next phase, which would presumably be much less intense

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Speaker 7: and would see some kind of reopening of the state

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Speaker 7: of the stretch of Hormus and golf Arab states being

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Speaker 7: targeted less by Iran. So yes, that is possible, But

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Speaker 7: it depends so much on what Trump himself is thinking,

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Speaker 7: and what he's willing to see as victory and how

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Speaker 7: much pain he's willing to accept himself for the US

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Speaker 7: economy in terms of higher energy prices and all that.

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Speaker 1: And of course, at the same time, Israel has been

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Speaker 1: part of these strikes too on Iran and also as

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Speaker 1: we've been reporting on hisbel In targets and Lebanon as well.

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Speaker 1: If Donald Trump were to decide that he wanted to

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Speaker 1: end the war, would Israel be willing to stop attacking

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Speaker 1: Iran as well?

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Speaker 7: See that's a big question, and there's certainly some strong thinking.

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Speaker 7: And this ties in with plenty of public comments from

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Speaker 7: x Israeli officials and all that that they don't and

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Speaker 7: the government even itself is sort of implying this. It

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Speaker 7: doesn't want this war to and yet it wants to

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Speaker 7: degrade Iran further. I think it is important to note

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Speaker 7: though that even Israel is sort of softening its tone

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Speaker 7: on regime change. It was more hinting at regime change,

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Speaker 7: even more firmly than the Americans were when this war

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Speaker 7: started on February twenty eight, But it's pulling back a bit.

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Speaker 7: So that might be a sign that Israel itself no

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Speaker 7: longer thinks that regime change is possible. And if that's

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Speaker 7: the case, then maybe it would just have no choice

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Speaker 7: but to accept Trump saying Okay, we're done. We're stopping

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Speaker 7: strikes on Iran. Now, it's quite difficult to see a

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Speaker 7: situation where the US stops and says wars over and

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Speaker 7: Israel keeps bombing around on a frequent basis. I'm sure

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Speaker 7: Israel will say it retains the right to do that

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Speaker 7: at any time if it sees a threat, but you know,

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Speaker 7: I don't think it would.

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Speaker 8: It's difficult to see.

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Speaker 7: It carrying on as it has been doing in the

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Speaker 7: last ten days.

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Speaker 1: Okay, Paul, thank you very much. Paul Wallace, Thearram add

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Speaker 1: Least managing editor. Stay with us. More from Bloomberg Daybreak

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Speaker 1: Europe coming up after this. Although markets are breathing a

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Speaker 1: sigh of relief at least for now, over the prospects

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Speaker 1: of the war could and our central banks off the hook.

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Speaker 1: We saw yesterday how a huge surgeon oil price has

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Speaker 1: led to a repricing of government debt and rate move expectations.

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Speaker 1: We have been ber companion columnus Daniel Mass with us

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Speaker 1: now for more, Daniel. When we're looking at things this

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Speaker 1: morning versus yesterday morning, the markets looked to be in

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Speaker 1: a different place, but are the inflation risks from the

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Speaker 1: Iran War very different? Or do we just need to

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Speaker 1: be prepared for more price spikes?

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Speaker 8: Expectations on this are changing in some instances by the day.

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Speaker 8: So you're asking me, do things look very different for

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Speaker 8: central banks than they did yesterday? Sure, but yesterday they

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Speaker 8: looked very different from last Wednesday when there was a

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Speaker 8: major meltdown on Asian indexes. What policy makers would really

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Speaker 8: love to be able to do is to look through

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Speaker 8: this and see what of higher energy prices has embedded

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Speaker 8: itself in underlying trends of the economy. It is way

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Speaker 8: too soon to say that. On the other hand, to

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Speaker 8: make that bet, they need to be confident hostilities are

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Speaker 8: going to end soon. Donald Trump has given mixed messages

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Speaker 8: on this just in the last twenty four hours. What's

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Speaker 8: it going to be like in the next seventy two

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Speaker 8: which central banks need to be most worried about?

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Speaker 6: This?

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Speaker 1: Is it a much bigger problem in for example, South

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Speaker 1: Korea than in the UK For the Bank of England.

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Speaker 8: Economies are coming to this space right now where we are,

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Speaker 8: because this is a movable feast. At two point fifteen

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Speaker 8: pm in Singapore on Tuesday, They're coming at it from

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Speaker 8: different places. You mentioned Korea. Korea was doing pretty well.

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Speaker 8: It's economy was reasonably strong. They've got an unemployment problem,

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Speaker 8: but the text sector was doing very very well on

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Speaker 8: the back of demands for anything AI related, and policymakers

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Speaker 8: there had indicated that their cuts were over and they see,

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Speaker 8: thanks to their own dot plot, interest rates being unchanged

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Speaker 8: for the next six months or so. Now, one thing

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Speaker 8: we can say with a degree of confidence is that

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Speaker 8: anyone in Asia who was thinking about an imminent cut

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Speaker 8: in rates has to think again. If we get another

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Speaker 8: couple of weeks of conflict, then there'll be a recalibration.

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Speaker 8: Look talking hawkishly saying you're ready to take whatever measures

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Speaker 8: are needed, you're hoping you don't have to act on that.

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Speaker 8: Talking hawkish is easy. Actually following through is a lot

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Speaker 8: harder when some of your economies are in a pretty

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Speaker 8: soft spot.

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Speaker 1: Are there When it comes to looking through the price moves,

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Speaker 1: are there laughins to be learned from previous Middle East

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Speaker 1: says about what the lasting effects look like.

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Speaker 8: It's very difficult. Let me draw on another analogy for you.

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Speaker 8: The world economy has absorbed a lot of blows in

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Speaker 8: the past twelve months and is still standing. It's almost

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Speaker 8: a year ago, since the Liberation Day moment in the

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Speaker 8: Rose Garden, when widespread tariffs were imposed by the administration.

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Speaker 8: You think of everything, the drama that transpired in the

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Speaker 8: weeks following that. Oh, there's going to be a deep downturn,

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Speaker 8: it's sell America, American assets will never be the same. Well,

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Speaker 8: none of those things has transpired.

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Speaker 1: This is Bloomberg Daybreak Europe, your morning brief on the

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Speaker 1: stories making news from London to Wall Streets and beyond.

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