WEBVTT - Eurasia Group President Ian Bremmer Talks Hormuz Military Blockade

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<v Speaker 1>Bloomberg Audio Studios, podcasts, radio news.

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<v Speaker 2>US Iran talks are planned in Pakistan for Wednesday. According

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<v Speaker 2>to CNN, Vice President jad Vance is expected to fly

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<v Speaker 2>there tomorrow. Ian Bremer, your Asia Group president and founder,

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<v Speaker 2>outlined for Cubrists that could derail in Iran deal. He

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<v Speaker 2>joins US Now Ian it is the consistent headline fatigue

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<v Speaker 2>and fog of war that we've been dealing with. First,

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<v Speaker 2>the straightform MOOS is open on Friday, that Iran says

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<v Speaker 2>it's closed on Saturday. Questions surrounding the US seizure of

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<v Speaker 2>an Iranian ship, are you confident, like this market is

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<v Speaker 2>that we are indeed in an off ramp to piece.

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<v Speaker 1>No, No, not at all. I'm confident that we're in

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<v Speaker 1>an off ramp for an announcement of peace. I think

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<v Speaker 1>we will get a second round of talks. I think

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<v Speaker 1>they'll go forward. I think Vance will get there and

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<v Speaker 1>he'll talk to the Iranians. And it wouldn't surprise me

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<v Speaker 1>at all if on the back of that there's some progress.

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<v Speaker 1>Both sides are pretty close on many issues. Trump really

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<v Speaker 1>wants a deal. Trump is likely to announce one, but

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<v Speaker 1>moving from an announcement to an actual implementation that then

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<v Speaker 1>lets us feel like we can get traffic in the

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<v Speaker 1>straight back to normal. That's a lot a lifting that

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<v Speaker 1>has to happen before then. There are a lot of

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<v Speaker 1>ways that that can blow apart. We're not close to

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<v Speaker 1>that in my view.

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<v Speaker 3>How important is that to the president Outwardly? It's important

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<v Speaker 3>for the Republican Party that the price at the pump

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<v Speaker 3>not accelerate any further and hopefully come down. But I

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<v Speaker 3>wonder if the President feels comfortable with crude oil in

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<v Speaker 3>the eighty or ninety dollars range. It certainly hasn't hurt

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<v Speaker 3>the energy companies that I'm sure lobby him, and it's

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<v Speaker 3>obviously been beneficial to Russia.

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<v Speaker 1>As well well. He seems to feel more comfortable now

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<v Speaker 1>than he did when he gave the State of the

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<v Speaker 1>Union and was talking about gas under two bucks at

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<v Speaker 1>a station in Iowa. That's how he started his speech.

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<v Speaker 1>Now he's saying, you know, oil is a lot lower

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<v Speaker 1>than it could have been. He heard two hundred and

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<v Speaker 1>two fifty three hundred dollars and it's under one hundred.

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<v Speaker 1>Isn't that great? And that's because not only have prices

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<v Speaker 1>gone way up under his administration and because of his

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<v Speaker 1>decisions in Iran, but also because he doesn't have a

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<v Speaker 1>mechanism to get them down. He knows that, So, I mean,

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<v Speaker 1>he doesn't have a military plan that's going to open

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<v Speaker 1>the strait anytime soon. And in some ways he's been

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<v Speaker 1>slow rolling it. You know, you've got an aircraft strike

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<v Speaker 1>carrier group that's now going the slow way around the

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<v Speaker 1>Cape of Good Hope. You've got other thousands of marine

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<v Speaker 1>expeditionary unit that's still on the other side of the

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<v Speaker 1>Strait of Malacca. And so it doesn't look like there

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<v Speaker 1>is an imminent military decision to escalate, nor is there

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<v Speaker 1>a pl that looks like it would get prices down.

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<v Speaker 1>So at this point Trump has to accept that come November,

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<v Speaker 1>a big part of his efforts at the midterms are

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<v Speaker 1>going to be underwater with affordability.

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<v Speaker 3>So this is why you're confident Ian that we're going

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<v Speaker 3>to get an extension of the ceasefire, right because that

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<v Speaker 3>is supposed to end on Tuesday night. We're seeing now

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<v Speaker 3>headlines that talks may actually happen Wednesday in Islamabad, which

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<v Speaker 3>would be great timing to extend the ceasefire for no

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<v Speaker 3>reason at all. The big problem though, is that that

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<v Speaker 3>would allow the Iranians to dig out, as you put

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<v Speaker 3>in your notes, some of their missiles that are US

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<v Speaker 3>and Israeli attacks have buried.

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<v Speaker 1>Well, that's already happened, right, I mean, over the last week.

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<v Speaker 1>We already have the Iranians improving their military capabilities because

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<v Speaker 1>there's a ceasefire on so I mean Trump Trump's willingness

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<v Speaker 1>to provide a ceasefire implied that he was quite serious

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<v Speaker 1>about an off ramp, because otherwise why would he give

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<v Speaker 1>the Iranians that time. Now he's trying to show that

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<v Speaker 1>he's serious and that there'll be consequences with the blockade

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<v Speaker 1>I think that is and with the attack and the

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<v Speaker 1>seizure of an Iranian vessel. At the same time, the

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<v Speaker 1>ceasefire is still in place. The Americans haven't violated it.

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<v Speaker 1>Trump has pushed the Israelis to accept a ceasefire with Lebanon.

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<v Speaker 1>He's quite proud of that. He's been calling up global

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<v Speaker 1>leaders and telling them what a great job he did

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<v Speaker 1>at ending yet another war, this time between Israel and Lebanon.

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<v Speaker 1>He's also been threatening the Iranians a fifth time by

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<v Speaker 1>my count, and that if they don't come to the table,

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<v Speaker 1>and agree with Trump on a breakthrough that he's going

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<v Speaker 1>to blow up all of their civilian infrastructure. He's less

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<v Speaker 1>credible on that one. But still, everything about Trump's activities

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<v Speaker 1>and posturing in the last two weeks seemed to imply

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<v Speaker 1>he wants to extend the ceasefire. Seems to imply he

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<v Speaker 1>really doesn't want to go back to fighting if he

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<v Speaker 1>can avoid it.

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<v Speaker 2>But still, there is this US military blockade in the

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<v Speaker 2>Strait of Hormus. I mean, this's just coming out now

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<v Speaker 2>that they've directed twenty seven vessels to turn back, according

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<v Speaker 2>to the US military Ian. To what degree does this

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<v Speaker 2>place more economic pressure on Iran itself? And is that

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<v Speaker 2>something that could move the needle further, that could bring

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<v Speaker 2>them to the table, You have to hope.

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<v Speaker 1>So it's putting more pressure on Iran. It's also putting

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<v Speaker 1>more economic pressure on the United States, which improves America's credibility.

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<v Speaker 1>Let's remember that Iran has a lot more money today

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<v Speaker 1>than they did six weeks ago because the oil prices

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<v Speaker 1>are so much higher, and because the United States wasn't

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<v Speaker 1>imposing a blockade. In fact, until last week, the Americans

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<v Speaker 1>had suspended oil sanctions on Iran because at that point,

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<v Speaker 1>Trump was focused more on keeping prices down than on

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<v Speaker 1>pressuring the Iranian regime. He has since flipped that logic

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<v Speaker 1>on its head, and so now he's trying to do

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<v Speaker 1>more to show the Iranians he's going to squeeze them.

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<v Speaker 1>Is that really about economic pressure or is it about

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<v Speaker 1>trying to show American credibility that if you persist with

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<v Speaker 1>a refusal to come to the table and come to terms,

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<v Speaker 1>that the United States is capable of waiting you out,

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<v Speaker 1>and do the Iranians find that credible? I mean, the

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<v Speaker 1>real danger here is that Iran. I mean, you saw

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<v Speaker 1>Trump said I'm no more, mister nice guy, if you're

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<v Speaker 1>the supreme leader of Iran, or if you're the leaders

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<v Speaker 1>of the IRGC and Trump has already with the Israelis

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<v Speaker 1>killed your father and your mother and one hundred and

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<v Speaker 1>fifty of the leaders of your country have been assassinated,

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<v Speaker 1>and then you're saying no more, mister nice guy. Plausibly.

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<v Speaker 1>You didn't think he was mister nice guy even before

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<v Speaker 1>he said that, right, plausibly. So I think that you

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<v Speaker 1>know the problem is America is trying to negotiate, having

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<v Speaker 1>already blown up the negotiations with a group of leaders

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<v Speaker 1>that may not be focused just on how do we

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<v Speaker 1>get to yes with the United States. There may be

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<v Speaker 1>a willingness to engage in retribution. There may be some

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<v Speaker 1>ideology that is not about just survival as a regime.

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<v Speaker 1>This may be kind of a challenge that the Israelis

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<v Speaker 1>had with Hamas in Gaza, for example. But I don't

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<v Speaker 1>think the Americans are prepared to do the damage to

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<v Speaker 1>Iran that the Israelis were to the people of Gaza

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<v Speaker 1>to get to their military outcomes. And so that limits

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<v Speaker 1>the ability of Trump to force the Iranians to do

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<v Speaker 1>what he wants.

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<v Speaker 3>And to what extent has Pudin and Russia been a

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<v Speaker 3>beneficiary of this war? And how is China positioned.

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<v Speaker 1>Russia is a near term beneficiary, probably the biggest of

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<v Speaker 1>the near term beneficiaries, again like Iran until last week,

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<v Speaker 1>selling a lot more oil and gas and fertilizer, and

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<v Speaker 1>that's what the Russians have to export at much higher

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<v Speaker 1>prices because of the war.

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<v Speaker 3>And those sanctions remain lifted. By the way, what the

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<v Speaker 3>sanctions on Russia that they have been lifted.

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<v Speaker 1>Russian sanctions have been suspended just as the Iranian sanctions

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<v Speaker 1>were suspended by the United States. They are still suspended

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<v Speaker 1>as of today, and so the Russians are making a

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<v Speaker 1>lot more money. Also, of course, a lot of the

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<v Speaker 1>military capabilities that had been available to sell to the

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<v Speaker 1>Europeans who were providing them to Ukraine, those military capabilities interceptors,

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<v Speaker 1>missile defense, they are now going to the Gulf region.

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<v Speaker 1>So the fact is that the Russians no longer have

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<v Speaker 1>to worry as much that the Ukrainians are going to

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<v Speaker 1>be able to repel them the way they have. Having

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<v Speaker 1>said all of that, Ukraine today is the most capable

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<v Speaker 1>and trained military in Europe. And I don't think that

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<v Speaker 1>was Putin's intention four years ago, but that is the

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<v Speaker 1>reality today. And Putin has not been able to take

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<v Speaker 1>any land from the Ukrainians in the last three months.

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<v Speaker 1>In fact, he's actually lost some land in occupied Ukraine

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<v Speaker 1>that the Ukrainians have taken back. So when I look

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<v Speaker 1>at Russia today from a global perspective, even though their

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<v Speaker 1>position has improved somewhat in the past weeks of the

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<v Speaker 1>Iran War, I wouldn't want to be in their position.

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<v Speaker 1>It's also true that the trans atlantic relationship getting a

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<v Speaker 1>lot weaker, more fractious that is an improvement for Putin.

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<v Speaker 1>He likes big existential questions around NATO, the Americans calling

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<v Speaker 1>NATO allies cowards. Putin likes all of that, but his

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<v Speaker 1>biggest ally in Europe, victor Orbon and Hungary just lost

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<v Speaker 1>to an anti Russian Hungarian right wing populist Petter Magyar

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<v Speaker 1>with a constitutional majority, which means that the Europeans, even

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<v Speaker 1>with the new Bulgaria elections, the Europeans are going to

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<v Speaker 1>have an easier time raising more money for Ukraine, raising

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<v Speaker 1>more loans for Ukraine, putting tougher sanctions on the Russians.

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<v Speaker 1>So I really don't think Putin's in a materially better

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<v Speaker 1>position as a consequence of all this, China is in

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<v Speaker 1>a materially better position long term because so many countries

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<v Speaker 1>are angry with the United States. This war that the

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<v Speaker 1>Americans launched in Iran is enormously unpopular with almost every

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<v Speaker 1>country in the world except Israel, and that has led

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<v Speaker 1>many governments to want to hedge more with other countries,

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<v Speaker 1>including with China. So long term, even though this hurts

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<v Speaker 1>the Chinese economy, they're not a big energy exporter that

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<v Speaker 1>they don't like to see these prices going up anymore

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<v Speaker 1>than the Indonesians or the South Koreans, But long term,

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<v Speaker 1>China sees themselves as in a better strategic position.

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<v Speaker 3>Ian, I hate to wrap you because I would love

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<v Speaker 3>to have you for longer. Ian Bremer of the Eurasia Group,

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<v Speaker 3>President there and founder. Thank you so much for joining us.

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<v Speaker 3>Always great to get some time with you.