1 00:00:00,080 --> 00:00:10,160 Speaker 1: Bloomberg Audio Studios, Podcasts, Radio News. Welcome to the Bloomberg 2 00:00:10,240 --> 00:00:15,920 Speaker 1: This Weekend Podcast with David Gura, Christina Raffini, and Lisa Matteo. 3 00:00:17,680 --> 00:00:20,560 Speaker 2: Thanks for joining us for today's selection of conversations from 4 00:00:20,600 --> 00:00:20,959 Speaker 2: the show. 5 00:00:21,200 --> 00:00:23,479 Speaker 3: You can listen to our favorite discussions right here on 6 00:00:23,520 --> 00:00:25,800 Speaker 3: the podcast, but also make sure to join us live 7 00:00:25,960 --> 00:00:28,960 Speaker 3: every Saturday and Sunday morning, starting at seven am Easter. 8 00:00:29,160 --> 00:00:32,760 Speaker 4: We're on Bloomberg Television, Radio, and the Bloomberg Business App, 9 00:00:33,040 --> 00:00:37,600 Speaker 4: bringing you unique takes and in depth interviews on news, politics, 10 00:00:37,680 --> 00:00:39,120 Speaker 4: lifestyle and culture. 11 00:00:40,400 --> 00:00:42,320 Speaker 2: We want to start with what a lot of people 12 00:00:42,360 --> 00:00:44,599 Speaker 2: are talking about this morning, and that's oil and gasoline 13 00:00:44,640 --> 00:00:47,800 Speaker 2: prices there at levels we haven't seen in years. For more, 14 00:00:47,840 --> 00:00:50,600 Speaker 2: we are joined by Michael McKee, Bloomberg TV and Radio's 15 00:00:50,600 --> 00:00:54,600 Speaker 2: international economics and policy correspondent, and Julian Lee, and oil 16 00:00:54,600 --> 00:00:57,880 Speaker 2: strategist for Bloombergner's News. Excuse me News, joining us out 17 00:00:57,920 --> 00:01:00,320 Speaker 2: of London. Mike, I'm going to start with you since 18 00:01:00,360 --> 00:01:01,760 Speaker 2: you were here on set with us. Thank you so 19 00:01:01,840 --> 00:01:05,360 Speaker 2: much for coming in this early. All three major indexes 20 00:01:05,400 --> 00:01:08,240 Speaker 2: all dropped about one percent as oil and gas search 21 00:01:08,680 --> 00:01:10,240 Speaker 2: tell us what's going on with the markets, what are 22 00:01:10,240 --> 00:01:12,240 Speaker 2: investors looking at, and where we think this might be going. 23 00:01:12,360 --> 00:01:15,280 Speaker 5: Well, there's sort of a dividing line. Initially people thought 24 00:01:15,360 --> 00:01:18,560 Speaker 5: this was going to be very short. The other military 25 00:01:18,600 --> 00:01:21,600 Speaker 5: engagements the presidents involved us and have been very short. 26 00:01:22,000 --> 00:01:24,520 Speaker 5: The longer it goes, the more concerned people get about 27 00:01:24,680 --> 00:01:27,360 Speaker 5: what the impact on the economy is. And a lot 28 00:01:27,360 --> 00:01:29,560 Speaker 5: of that has to do with how Americans are going 29 00:01:29,600 --> 00:01:32,360 Speaker 5: to be feeling about this conflict and whether or not 30 00:01:32,360 --> 00:01:36,640 Speaker 5: they'll pull back on spending. And we've seen CEOs across 31 00:01:36,680 --> 00:01:39,840 Speaker 5: the country because of tariffs, sitting on their hands, not 32 00:01:39,920 --> 00:01:40,840 Speaker 5: sure what to do. 33 00:01:41,160 --> 00:01:42,679 Speaker 6: And this just prologs that and. 34 00:01:42,600 --> 00:01:44,800 Speaker 2: An oil problem can become an everything problem. 35 00:01:44,920 --> 00:01:47,080 Speaker 5: An oil problem can become an everything problem. But it's 36 00:01:47,120 --> 00:01:49,360 Speaker 5: not like it is it was in the nineteen seventies, 37 00:01:49,360 --> 00:01:51,400 Speaker 5: and a lot of people have made that comparison were 38 00:01:51,480 --> 00:01:52,640 Speaker 5: much less energy dependent. 39 00:01:52,680 --> 00:01:56,160 Speaker 6: We use much less energy to an oil. 40 00:01:56,400 --> 00:02:00,200 Speaker 5: For each output unit of output that we make these days, 41 00:02:00,240 --> 00:02:04,640 Speaker 5: and so it is less likely to be a recession 42 00:02:04,760 --> 00:02:07,760 Speaker 5: in the United States. We might see slower growth, but 43 00:02:08,120 --> 00:02:10,440 Speaker 5: it's not as much of a danger as it would appear. 44 00:02:10,480 --> 00:02:13,760 Speaker 5: It's more of a political danger to the administration because 45 00:02:13,800 --> 00:02:17,040 Speaker 5: of course, people hate the idea of rising gasoline prices. 46 00:02:17,480 --> 00:02:19,679 Speaker 7: Julianlie let's talk about how the global oil market is 47 00:02:19,720 --> 00:02:21,480 Speaker 7: adjusting as a result of what's been happening here over 48 00:02:21,520 --> 00:02:23,120 Speaker 7: the last few days. We'll talk about the US and 49 00:02:23,160 --> 00:02:25,079 Speaker 7: in just a moment, but looking at it globally, we've 50 00:02:25,080 --> 00:02:27,880 Speaker 7: seen the startling images of how little traffic there is 51 00:02:27,919 --> 00:02:30,680 Speaker 7: in the Strait of hor Moves, heard about how some countries, 52 00:02:30,680 --> 00:02:33,000 Speaker 7: including Saudi Arabia, trying to reroute a lot of the 53 00:02:33,040 --> 00:02:35,720 Speaker 7: oil they're producing. Just give us a broad look at 54 00:02:35,760 --> 00:02:38,720 Speaker 7: the way in which the global energy industry is trying 55 00:02:38,760 --> 00:02:40,800 Speaker 7: to change as the result of what's happening here. 56 00:02:42,240 --> 00:02:46,359 Speaker 8: Well, I mean, historically, about between seventeen and twenty million 57 00:02:46,400 --> 00:02:49,680 Speaker 8: barrels a day of oil goes through the Straight Offall Moves. 58 00:02:50,480 --> 00:02:54,200 Speaker 8: About fifteen to twenty percent of the world's liquefied natural 59 00:02:54,280 --> 00:02:57,880 Speaker 8: gas also goes through the Straight of Four Moves. Since 60 00:02:57,919 --> 00:03:04,160 Speaker 8: the beginning of March, virtually has left the Straits are 61 00:03:04,320 --> 00:03:10,040 Speaker 8: effectively closed. They're not physically closed, but threats of attacks 62 00:03:10,280 --> 00:03:14,160 Speaker 8: and attacks that have been carried out on ships transiting 63 00:03:14,200 --> 00:03:18,200 Speaker 8: the Straits have created a situation where owners and crews 64 00:03:18,240 --> 00:03:22,359 Speaker 8: and charterers don't want to take vessels through. That has 65 00:03:22,520 --> 00:03:26,320 Speaker 8: left a real problem for both oil and gas. We 66 00:03:26,400 --> 00:03:29,440 Speaker 8: did a survey the end of last week. There are 67 00:03:29,440 --> 00:03:36,160 Speaker 8: about seventy five super tankers inside in the Gulf. Almost 68 00:03:36,200 --> 00:03:40,640 Speaker 8: fifty of those are full. Others are being used for 69 00:03:40,720 --> 00:03:45,200 Speaker 8: long term storage or are related to the Iranian trade. 70 00:03:46,120 --> 00:03:50,480 Speaker 8: We calculated there were just nine tankers that were empty. 71 00:03:52,000 --> 00:03:57,160 Speaker 8: Each tanker can take about five hours worth of total 72 00:03:57,200 --> 00:04:01,200 Speaker 8: Saudi production, so you know, you've got about four days 73 00:04:01,280 --> 00:04:05,080 Speaker 8: worth of Saudi production that can still be put onto 74 00:04:05,120 --> 00:04:07,920 Speaker 8: tagers in the Gulf and acid. Nobody else produces anything. 75 00:04:08,480 --> 00:04:13,000 Speaker 8: We've already seen reports that both Iraq and Qwaight are 76 00:04:13,040 --> 00:04:17,080 Speaker 8: cutting back their production because their storage tags on land 77 00:04:17,120 --> 00:04:19,320 Speaker 8: are full and they don't have anywhere else to put 78 00:04:19,360 --> 00:04:23,359 Speaker 8: the oil. Saudi Arabia, as you said, is diverting crude 79 00:04:24,240 --> 00:04:28,560 Speaker 8: across to the Red Sea, but that route isn't sufficient 80 00:04:28,640 --> 00:04:32,359 Speaker 8: to take all of its exports, so we have a 81 00:04:32,400 --> 00:04:38,040 Speaker 8: backlog and oil isn't getting out. While the West and 82 00:04:38,080 --> 00:04:41,520 Speaker 8: the US in particular is much less dependent on Middle 83 00:04:41,520 --> 00:04:44,600 Speaker 8: Eastern oil than it was back in the nineteen seventies, 84 00:04:44,600 --> 00:04:47,880 Speaker 8: the price is global, So if China and India can't 85 00:04:47,960 --> 00:04:50,400 Speaker 8: get the oil that they need from the Middle East, 86 00:04:50,640 --> 00:04:52,440 Speaker 8: They're going to try and get it from somewhere else. 87 00:04:52,680 --> 00:04:55,360 Speaker 8: Prices are going to go up for everybody you. 88 00:04:55,360 --> 00:04:57,040 Speaker 7: Bring up India. I want to play a bit of 89 00:04:57,080 --> 00:04:59,239 Speaker 7: tape here of Kevin has the president Chief Economic Advisor, 90 00:04:59,240 --> 00:05:01,440 Speaker 7: who was on Bloomberg To yesterday after the job support 91 00:05:01,480 --> 00:05:03,440 Speaker 7: came out, and he was asked about the way that 92 00:05:03,480 --> 00:05:05,400 Speaker 7: the White House is looking at the global energy market 93 00:05:05,480 --> 00:05:06,560 Speaker 7: right now. Let's take a list to what he had 94 00:05:06,560 --> 00:05:08,200 Speaker 7: to say about what the White House is considering doing 95 00:05:08,320 --> 00:05:09,240 Speaker 7: and indeed starting to do. 96 00:05:09,839 --> 00:05:13,240 Speaker 9: The sanctioned waiver the Secretary Vestment came out with is 97 00:05:13,279 --> 00:05:16,679 Speaker 9: just one of many many tools that we have ready. 98 00:05:17,120 --> 00:05:19,840 Speaker 9: We've got a whole flow chart of tools to use 99 00:05:19,839 --> 00:05:23,200 Speaker 9: the penig on this or that, and we're ready to 100 00:05:23,279 --> 00:05:26,560 Speaker 9: move them as food as we have to. But we're 101 00:05:26,600 --> 00:05:28,760 Speaker 9: also very optimistic that we're going to be able to 102 00:05:28,760 --> 00:05:31,560 Speaker 9: get this near term problem resolved relatively quickly. 103 00:05:31,960 --> 00:05:33,960 Speaker 7: Michael mcga get us up to speed on what Kevin 104 00:05:34,000 --> 00:05:35,800 Speaker 7: Hassett is talking about there. We heard from the Treasury 105 00:05:35,800 --> 00:05:38,920 Speaker 7: Secretary this willingness to relax sanctions on Russia to get 106 00:05:39,279 --> 00:05:42,080 Speaker 7: oil to India. He's indicated there might be an expansion 107 00:05:42,120 --> 00:05:44,520 Speaker 7: of that in the days ahead. Talk a bit about 108 00:05:44,560 --> 00:05:47,400 Speaker 7: the significance of that in light of the really robust 109 00:05:47,400 --> 00:05:49,560 Speaker 7: sanctions that have been placed on Russia since the start 110 00:05:49,600 --> 00:05:50,520 Speaker 7: of the war in Ukraine. 111 00:05:50,839 --> 00:05:52,480 Speaker 5: Well, this is a bit of good news for Russia 112 00:05:52,520 --> 00:05:54,120 Speaker 5: in the sense that they can sell more oil. 113 00:05:54,200 --> 00:05:54,360 Speaker 6: Now. 114 00:05:54,520 --> 00:05:57,520 Speaker 5: The US and India had just reached a deal where 115 00:05:57,560 --> 00:06:00,240 Speaker 5: India said it would no longer buy Russian crude, and 116 00:06:00,279 --> 00:06:04,800 Speaker 5: that would have crimped the Kremlin's ability to fund its 117 00:06:04,920 --> 00:06:09,040 Speaker 5: Ukraine war. And now to keep prices down, the President's 118 00:06:09,080 --> 00:06:12,320 Speaker 5: going to let India buy more oil. The other question 119 00:06:12,520 --> 00:06:15,240 Speaker 5: that follows from that is will they let China buy 120 00:06:15,279 --> 00:06:18,479 Speaker 5: more oil, because they too are under the sanctions. 121 00:06:18,520 --> 00:06:21,160 Speaker 6: So it's a good thing for Russia. 122 00:06:21,200 --> 00:06:24,280 Speaker 5: It doesn't really help the US that much because, as 123 00:06:24,360 --> 00:06:27,960 Speaker 5: Julian said, oil is a globally priced commodity. So we'll 124 00:06:28,000 --> 00:06:31,320 Speaker 5: see if it has a major impact, but right now 125 00:06:31,880 --> 00:06:34,640 Speaker 5: it's not. And we're in that phase of the war 126 00:06:34,760 --> 00:06:39,680 Speaker 5: where for investors, for traders, you trade first and ask 127 00:06:39,800 --> 00:06:43,279 Speaker 5: questions later. There's an emotional component to this of things 128 00:06:43,320 --> 00:06:45,640 Speaker 5: are going up. So let's get ahead of that and 129 00:06:45,680 --> 00:06:49,680 Speaker 5: then we can figure out what the actual outcome damage 130 00:06:49,720 --> 00:06:50,240 Speaker 5: is going to be. 131 00:06:50,920 --> 00:06:54,000 Speaker 2: Julian. My other question about this is had India and 132 00:06:54,120 --> 00:06:56,800 Speaker 2: or China ever really stopped buying Russian oil, because this 133 00:06:56,839 --> 00:06:59,279 Speaker 2: is one of the issues how to get them to stop. 134 00:06:59,320 --> 00:07:01,880 Speaker 2: There was talk about secondary sanctions that they never really 135 00:07:01,920 --> 00:07:05,800 Speaker 2: follow through with with any kind of effective capacity. Is 136 00:07:05,800 --> 00:07:09,320 Speaker 2: this really going to make that much difference realistically or 137 00:07:09,400 --> 00:07:11,960 Speaker 2: is this just kind of a diplomatic coup from Moscow? 138 00:07:13,120 --> 00:07:15,280 Speaker 8: Well, I think for Moscow it is. It is a 139 00:07:15,360 --> 00:07:19,200 Speaker 8: huge win and they are that so far, they are 140 00:07:19,240 --> 00:07:22,720 Speaker 8: the only clear winner out of a week of war 141 00:07:23,080 --> 00:07:27,600 Speaker 8: in Iran. This does two things for Russia. It allows 142 00:07:27,640 --> 00:07:32,320 Speaker 8: them to boost their sales to India. India had roughly 143 00:07:32,520 --> 00:07:38,360 Speaker 8: halved its purchases of Russian crude since late last year 144 00:07:38,440 --> 00:07:44,880 Speaker 8: when President Trump imposed these extra tariffs on India. China 145 00:07:44,960 --> 00:07:48,400 Speaker 8: has really just skated over all of this. It continues 146 00:07:48,440 --> 00:07:51,920 Speaker 8: to buy Russian oil. It stepped in to take what 147 00:07:52,800 --> 00:07:56,320 Speaker 8: most of what India wasn't taking over the last couple 148 00:07:56,320 --> 00:07:59,920 Speaker 8: of months. But the big hit for Russia was that 149 00:08:00,080 --> 00:08:03,600 Speaker 8: it had to offer ever deeper discounts in order to 150 00:08:03,640 --> 00:08:07,040 Speaker 8: shift that those barrels. What I think this waiver does 151 00:08:07,800 --> 00:08:11,320 Speaker 8: is it allows it to boost its sales to India 152 00:08:11,560 --> 00:08:14,600 Speaker 8: and it allows it to reduce the discounts that it 153 00:08:14,640 --> 00:08:18,920 Speaker 8: has to offer against global benchmarks. So you know, it's 154 00:08:18,960 --> 00:08:20,360 Speaker 8: a win win for Moscow. 155 00:08:21,480 --> 00:08:22,160 Speaker 3: Mike McKee. 156 00:08:22,160 --> 00:08:24,400 Speaker 7: Something else that Kevin Hassett was asked about was whether 157 00:08:24,440 --> 00:08:27,200 Speaker 7: the US would consider or is considering, releasing oil from 158 00:08:27,200 --> 00:08:28,840 Speaker 7: the Strategic Petroleum Reserve. 159 00:08:29,160 --> 00:08:30,800 Speaker 6: There's a lot in it. They have been refilling it. 160 00:08:31,440 --> 00:08:32,520 Speaker 6: What did he say about that? 161 00:08:32,679 --> 00:08:35,839 Speaker 7: And walk us through the calculus of this administration as 162 00:08:35,880 --> 00:08:38,760 Speaker 7: they with some alarm or looking at the midterms looming 163 00:08:38,760 --> 00:08:41,559 Speaker 7: on the horizon here and seeing this really precipitous rise 164 00:08:41,760 --> 00:08:42,520 Speaker 7: in prices. 165 00:08:42,200 --> 00:08:42,800 Speaker 6: Over the last week. 166 00:08:42,880 --> 00:08:46,280 Speaker 2: Former Energy Secretary Monies was on Bloomberg this week talking 167 00:08:46,280 --> 00:08:50,040 Speaker 2: about their decision during that administration to release from that reserve, 168 00:08:50,040 --> 00:08:52,240 Speaker 2: and even he was saying it's not always a good idea. 169 00:08:52,600 --> 00:08:55,600 Speaker 5: Well, at this point the administration feels it's not a 170 00:08:55,600 --> 00:08:58,160 Speaker 5: good idea. Kevin Hassen said, they're not considering it at 171 00:08:58,160 --> 00:09:01,200 Speaker 5: the moment. It's always on the table because you have it, 172 00:09:01,240 --> 00:09:03,440 Speaker 5: but it's less than half full because it hasn't been 173 00:09:04,040 --> 00:09:07,000 Speaker 5: refilled from the Biden administration letting it go. 174 00:09:07,160 --> 00:09:08,679 Speaker 6: So there's a. 175 00:09:08,640 --> 00:09:11,680 Speaker 5: Concern that if you use that now, you will run 176 00:09:11,760 --> 00:09:15,280 Speaker 5: dry too early in what might be a lengthy problem 177 00:09:15,480 --> 00:09:19,640 Speaker 5: getting oil. So it's not likely to happen in the 178 00:09:19,640 --> 00:09:23,000 Speaker 5: short term. But the administration is David, as you suggest, 179 00:09:23,200 --> 00:09:25,600 Speaker 5: sort of flailing about trying to find a way to 180 00:09:25,640 --> 00:09:28,920 Speaker 5: mitigate the pain, mitigate the headlines. There was even some 181 00:09:28,960 --> 00:09:32,360 Speaker 5: talk of the Treasury Department getting involved in buying oil futures, 182 00:09:32,720 --> 00:09:36,840 Speaker 5: which would have been something that's never happened before. And 183 00:09:36,920 --> 00:09:41,160 Speaker 5: of course, if the words unlimited liability mean anything to you, 184 00:09:41,240 --> 00:09:43,560 Speaker 5: it could have put us in that situation where the 185 00:09:43,640 --> 00:09:47,560 Speaker 5: US could lose billions and billions of dollars. So it 186 00:09:47,600 --> 00:09:50,280 Speaker 5: isn't clear what their strategy is at this point, because, 187 00:09:50,360 --> 00:09:53,600 Speaker 5: as we keep noting, gasoline prices keep going up and 188 00:09:53,720 --> 00:09:55,480 Speaker 5: keep going up by record amounts each day. 189 00:09:55,800 --> 00:09:58,440 Speaker 7: Are Michael McKee, International Economics and Policy correspondent joining us 190 00:09:58,480 --> 00:09:59,679 Speaker 7: on set here. We're going to come back with Mike 191 00:09:59,679 --> 00:10:00,679 Speaker 7: in a bit. He was speaking to a lot of 192 00:10:00,679 --> 00:10:02,480 Speaker 7: Fed officials over the course of the week. They, of course, 193 00:10:02,800 --> 00:10:05,480 Speaker 7: taking note of the fact these energy prices are rising. 194 00:10:05,559 --> 00:10:07,360 Speaker 7: Going to hear some sound from his interviews with a 195 00:10:07,400 --> 00:10:09,199 Speaker 7: number of them a little bit later in the show. 196 00:10:09,240 --> 00:10:11,520 Speaker 7: Our thanks to Julian Lee as well, oil strategist for 197 00:10:11,520 --> 00:10:13,920 Speaker 7: Bloomberg News based in London, joining us here on this Saturday. 198 00:10:14,000 --> 00:10:16,880 Speaker 3: Julian, thanks to you as well. Stay with us for 199 00:10:17,000 --> 00:10:18,559 Speaker 3: more on Bloomberg this weekend. 200 00:10:18,840 --> 00:10:28,199 Speaker 7: Right after this, some new reporting this morning from The 201 00:10:28,200 --> 00:10:31,040 Speaker 7: New York Times revealing Russia is sharing intelligence with Iran, 202 00:10:31,120 --> 00:10:35,920 Speaker 7: including satellite imagery showing the location of warships and military personnel. 203 00:10:36,200 --> 00:10:38,920 Speaker 7: Secretary Defense Pete Hegseth told Sixty Minutes that the US 204 00:10:39,040 --> 00:10:42,160 Speaker 7: is aware of all intelligence sharing and is working to 205 00:10:42,240 --> 00:10:43,400 Speaker 7: mitigate any risks. 206 00:10:43,960 --> 00:10:45,520 Speaker 10: We have the best intelligence in the world. 207 00:10:45,559 --> 00:10:48,240 Speaker 11: We're aware of who's talking to who, why they're talking 208 00:10:48,280 --> 00:10:50,760 Speaker 11: to him, how accurate that information might be, how we 209 00:10:50,840 --> 00:10:54,480 Speaker 11: factor that into our battle plans, our sentcom commander, So 210 00:10:54,880 --> 00:10:57,280 Speaker 11: we know what's going on, and the President has an 211 00:10:57,280 --> 00:11:01,240 Speaker 11: incredible knack at knowing how to mitigate those risks, and 212 00:11:01,320 --> 00:11:04,120 Speaker 11: so the American people can rest assured their commander in 213 00:11:04,160 --> 00:11:06,960 Speaker 11: chief is well aware of who's talking to who, and 214 00:11:07,120 --> 00:11:09,800 Speaker 11: anything that shouldn't be happening, whether it's in public or 215 00:11:09,840 --> 00:11:12,720 Speaker 11: back channeled, is being confronted and confronted strongly. 216 00:11:13,520 --> 00:11:15,040 Speaker 2: All right, we want to go now to you retired 217 00:11:15,040 --> 00:11:18,319 Speaker 2: Colonel Wayne Sanders. He is Bloomberg Intelligence Senior defense analyst. 218 00:11:18,440 --> 00:11:22,040 Speaker 2: And Becca Wasser, she's Bloomberg Economics Defense lead. Becca. I 219 00:11:22,120 --> 00:11:25,320 Speaker 2: want to start with you. Do we know okay, yes, 220 00:11:25,320 --> 00:11:29,160 Speaker 2: the Russians are sharing intelligence with Iran, but it's unclear 221 00:11:29,160 --> 00:11:31,760 Speaker 2: if they've actually used that intelligence yet or if they 222 00:11:31,920 --> 00:11:34,560 Speaker 2: help them in strikes. Do we know how far this 223 00:11:34,679 --> 00:11:36,360 Speaker 2: goes and how it's being utilized. 224 00:11:38,280 --> 00:11:40,360 Speaker 12: We don't know exactly how far it goes at this 225 00:11:40,440 --> 00:11:43,040 Speaker 12: point in time, but right now it's worth putting this 226 00:11:43,080 --> 00:11:47,120 Speaker 12: in a broader context. This is an existential fight for Iran, 227 00:11:47,400 --> 00:11:49,679 Speaker 12: so they're going to seek help wherever it is that 228 00:11:49,679 --> 00:11:52,319 Speaker 12: they can possibly find it, and they've had a great 229 00:11:52,320 --> 00:11:55,839 Speaker 12: alignment with Russia over the past few years. In fact, 230 00:11:55,960 --> 00:11:58,800 Speaker 12: Iranian produced drones, the shaw heads that we have seen 231 00:11:58,840 --> 00:12:02,800 Speaker 12: them use to great effect in attacks on places like 232 00:12:02,840 --> 00:12:06,800 Speaker 12: the Gulf States and US bases throughout the region. They 233 00:12:06,840 --> 00:12:09,880 Speaker 12: actually exported those to Russia, and Russia has been using 234 00:12:09,920 --> 00:12:14,760 Speaker 12: them in its own fight against Ukraine. So here there 235 00:12:14,840 --> 00:12:18,720 Speaker 12: is this alignment, and there's almost a sense of Araan 236 00:12:18,800 --> 00:12:21,520 Speaker 12: trying to seek help because it needs it, but trying 237 00:12:21,559 --> 00:12:24,120 Speaker 12: to get a little bit of what it is already 238 00:12:24,160 --> 00:12:27,320 Speaker 12: provided to Russia. So I expect that we're going to 239 00:12:27,400 --> 00:12:33,920 Speaker 12: see additional support being requested from Russia, possibly even China 240 00:12:33,960 --> 00:12:35,800 Speaker 12: by Iran in the coming days. 241 00:12:36,040 --> 00:12:38,560 Speaker 2: And Becca, you heard Secutary Defense say we have the 242 00:12:38,559 --> 00:12:40,880 Speaker 2: best intelligence of the world. We're aware of who's talking 243 00:12:40,920 --> 00:12:42,560 Speaker 2: to who should be home. But I'll move on from that. 244 00:12:43,440 --> 00:12:46,560 Speaker 2: But what can the US do about it? Yes, they're 245 00:12:46,600 --> 00:12:48,680 Speaker 2: aware of it, but how does the US Can the 246 00:12:48,760 --> 00:12:50,000 Speaker 2: US stop this from happening? 247 00:12:52,160 --> 00:12:56,240 Speaker 12: Honestly, the US probably can stop it from happening in 248 00:12:56,280 --> 00:13:00,080 Speaker 12: some ways, but there's a question of is it worth doing. 249 00:13:00,360 --> 00:13:05,640 Speaker 12: And yes, obviously, trying to reduce Iran's ability to have 250 00:13:05,800 --> 00:13:08,800 Speaker 12: a better targeting picture, to be able to be more 251 00:13:08,840 --> 00:13:12,479 Speaker 12: accurate in its strikes would be something that's really important. 252 00:13:12,600 --> 00:13:15,200 Speaker 12: And here there's a bunch of different ways where the 253 00:13:15,320 --> 00:13:18,439 Speaker 12: US could do it, depending on the ways in which 254 00:13:18,840 --> 00:13:22,440 Speaker 12: this is intelligence being shared. If it's space based intelligence, 255 00:13:22,760 --> 00:13:26,360 Speaker 12: there are ways to try and reduce Russia's ability to 256 00:13:26,440 --> 00:13:30,000 Speaker 12: see a good picture and provide it to Iran. There's 257 00:13:30,040 --> 00:13:33,400 Speaker 12: also ways to cut off some of those communications by 258 00:13:33,480 --> 00:13:36,960 Speaker 12: Russia and Iran. But at the end of the day, 259 00:13:37,120 --> 00:13:39,840 Speaker 12: it comes down to, is that where the US wants 260 00:13:39,880 --> 00:13:42,360 Speaker 12: to put the predominance of its effort, does it need 261 00:13:42,400 --> 00:13:47,920 Speaker 12: to potentially use some resources that once you use them, 262 00:13:47,960 --> 00:13:50,880 Speaker 12: you can't really use them again because they are discoverable 263 00:13:51,000 --> 00:13:55,760 Speaker 12: in certain ways. So it really depends on the prioritization 264 00:13:56,480 --> 00:14:00,320 Speaker 12: that the White House and the Department of Defense have 265 00:14:00,440 --> 00:14:04,160 Speaker 12: and frankly the intelligence community has, or whether they're going 266 00:14:04,160 --> 00:14:07,079 Speaker 12: to focus their efforts and their resources on other parts 267 00:14:07,080 --> 00:14:11,320 Speaker 12: of the fight, particularly as President Trump has said that 268 00:14:11,480 --> 00:14:14,280 Speaker 12: a big attack is coming, and also some of the 269 00:14:14,320 --> 00:14:18,000 Speaker 12: efforts to try and reduce the risks to US forrces 270 00:14:18,080 --> 00:14:19,520 Speaker 12: and allies and partners in the. 271 00:14:19,480 --> 00:14:21,200 Speaker 7: Region that's throat of a big attack coming in that 272 00:14:21,280 --> 00:14:23,680 Speaker 7: post from the President this morning on truth Social Colonel, 273 00:14:23,720 --> 00:14:26,040 Speaker 7: I want to go to you next. We've been talking 274 00:14:26,040 --> 00:14:27,680 Speaker 7: about some of the themes from the interview that I 275 00:14:27,680 --> 00:14:29,800 Speaker 7: did with Secretary of State Anthony Blincoln, former Secretary of 276 00:14:29,840 --> 00:14:32,960 Speaker 7: State earlier this week. He talked about how determining factors 277 00:14:32,960 --> 00:14:35,280 Speaker 7: here might be markets and munitions, and focusing on that 278 00:14:35,400 --> 00:14:37,680 Speaker 7: munition's part. We had a meeting at the White House 279 00:14:37,760 --> 00:14:41,800 Speaker 7: yesterday of executives from many big defense companies, the President saying, 280 00:14:41,800 --> 00:14:44,080 Speaker 7: we concluded a very good meeting with them. We discussed 281 00:14:44,080 --> 00:14:47,600 Speaker 7: production and production schedules. They've agreed to quadruple production of 282 00:14:47,640 --> 00:14:51,480 Speaker 7: the exquisite class weaponry that we want to reach as rapidly. 283 00:14:51,160 --> 00:14:53,880 Speaker 3: As possible the highest levels of quantity. 284 00:14:53,960 --> 00:14:55,040 Speaker 7: I want to ask you about that in a minute, 285 00:14:55,040 --> 00:14:56,520 Speaker 7: but first let's play a little bit of tape here 286 00:14:56,800 --> 00:14:59,400 Speaker 7: from retire General General Petraeus, who is on a Balance 287 00:14:59,400 --> 00:15:01,560 Speaker 7: of power and Bloo intelligion and Radio yesterday. 288 00:15:02,240 --> 00:15:05,440 Speaker 13: We're going to have to dramatically increase our industrial capacity. 289 00:15:05,520 --> 00:15:08,920 Speaker 13: By the way, we also have to transform our forces. 290 00:15:08,960 --> 00:15:11,800 Speaker 13: We need to change our very concepts of war. We 291 00:15:11,840 --> 00:15:14,760 Speaker 13: have to change our very doctrine, and then we have 292 00:15:14,840 --> 00:15:17,840 Speaker 13: to dramatically change what it is that we're buying and 293 00:15:17,920 --> 00:15:21,120 Speaker 13: also how we buy it. It needs to be updated constantly, 294 00:15:21,240 --> 00:15:24,560 Speaker 13: not say a million of exactly this over the next 295 00:15:24,600 --> 00:15:25,400 Speaker 13: four years. 296 00:15:25,680 --> 00:15:27,920 Speaker 7: So Colonel, let's focus on the munition's side of this, 297 00:15:28,000 --> 00:15:30,480 Speaker 7: what was discussed at that meeting yesterday, and how acute 298 00:15:30,480 --> 00:15:33,160 Speaker 7: in your estimation the need is here for these defense 299 00:15:33,160 --> 00:15:35,640 Speaker 7: companies to produce more At this moment as we enter 300 00:15:35,680 --> 00:15:36,800 Speaker 7: the second week of this war. 301 00:15:38,240 --> 00:15:40,160 Speaker 10: Thanks so much for having me. You know, when you 302 00:15:40,200 --> 00:15:42,720 Speaker 10: look at the main companies that they're looking at here 303 00:15:42,880 --> 00:15:44,960 Speaker 10: is really going to be the winners Lockheed, Northrop and 304 00:15:45,040 --> 00:15:48,000 Speaker 10: RTX based off of the munitions that they are providing. 305 00:15:48,040 --> 00:15:52,360 Speaker 10: So these exquisite ones they're talking about includes jazz and missiles, 306 00:15:52,760 --> 00:15:56,840 Speaker 10: l rathms PLAC three interceptors for air defense, the FAD 307 00:15:56,920 --> 00:16:00,520 Speaker 10: system as well as a PRISM. Northrope you've got solid 308 00:16:00,600 --> 00:16:03,760 Speaker 10: rocket motors boosters in their sentinement missile program, and then 309 00:16:03,840 --> 00:16:07,640 Speaker 10: RTX you've got Tomahawk's sidewinders and SM Six's. Why do 310 00:16:07,720 --> 00:16:09,560 Speaker 10: I say that is because there was already a big 311 00:16:09,560 --> 00:16:13,000 Speaker 10: focus around critical munitions production ramp up, and now that 312 00:16:13,040 --> 00:16:14,920 Speaker 10: they have all agreed to be able to do this, 313 00:16:14,920 --> 00:16:17,880 Speaker 10: this becomes a really big piece because those are going 314 00:16:17,920 --> 00:16:19,160 Speaker 10: to be some of the same ones that would be 315 00:16:19,240 --> 00:16:22,040 Speaker 10: used in a China contingency in twenty twenty seven or beyond. 316 00:16:22,800 --> 00:16:25,120 Speaker 10: So they want to make sure that they have adequate 317 00:16:25,160 --> 00:16:27,760 Speaker 10: numbers to be able to sustain not only their stockpiles 318 00:16:27,920 --> 00:16:30,800 Speaker 10: and replenish those, but then also make sure that if 319 00:16:30,840 --> 00:16:33,920 Speaker 10: they're needed for any further parts of the Iran conflict, 320 00:16:34,240 --> 00:16:36,960 Speaker 10: they can be You heard Secretary Hexstat earlier in the 321 00:16:37,000 --> 00:16:41,000 Speaker 10: week talked about transitioning away from those exquisite standoff weapons 322 00:16:41,080 --> 00:16:44,600 Speaker 10: and then moving into gravity fed. Gravity fed becomes very 323 00:16:44,600 --> 00:16:47,880 Speaker 10: important because those don't need solid rocket motors. They don't 324 00:16:47,880 --> 00:16:50,480 Speaker 10: need those. There's a gravity fed and there's no electronic 325 00:16:50,520 --> 00:16:52,840 Speaker 10: warfare to get in the way of these precision guided 326 00:16:52,920 --> 00:16:55,680 Speaker 10: munitions from hitting their targets. And we have them in 327 00:16:55,720 --> 00:16:58,280 Speaker 10: the tens of thousands and hundreds of thousands as to 328 00:16:58,400 --> 00:17:00,600 Speaker 10: pose to the numbers that you would have for these 329 00:17:00,640 --> 00:17:02,920 Speaker 10: other long strike weapons. 330 00:17:02,480 --> 00:17:04,400 Speaker 2: And Colonel very quickly before we have to go. There's 331 00:17:04,440 --> 00:17:06,240 Speaker 2: a bit of a disconnect here because you have the 332 00:17:06,280 --> 00:17:09,879 Speaker 2: Secretary saying we we're fine, we have enough munitions, we 333 00:17:09,880 --> 00:17:11,239 Speaker 2: can keep this going as long as we need to. 334 00:17:11,480 --> 00:17:14,000 Speaker 2: And there's also reporting this week that the US is 335 00:17:14,080 --> 00:17:18,200 Speaker 2: talking to folks like South Korea about possibly redeploying batteries 336 00:17:18,200 --> 00:17:21,000 Speaker 2: from there to this front. I'm wondering why they would 337 00:17:21,040 --> 00:17:22,720 Speaker 2: need to do that and if that's even realistic. 338 00:17:24,280 --> 00:17:26,080 Speaker 10: I think as you move into this part of the 339 00:17:26,080 --> 00:17:28,119 Speaker 10: fight too, I think it also goes into some of 340 00:17:28,119 --> 00:17:31,200 Speaker 10: the South Korean weapons systems, especially in their defense, do 341 00:17:31,240 --> 00:17:33,359 Speaker 10: a great job and all that they are lower cost 342 00:17:33,760 --> 00:17:36,080 Speaker 10: in lower yields, So if you can actually use those, 343 00:17:36,480 --> 00:17:39,680 Speaker 10: why not use those and save those for contingencies. But 344 00:17:40,040 --> 00:17:42,399 Speaker 10: I don't believe that the US entered this fight going okay, 345 00:17:42,440 --> 00:17:45,080 Speaker 10: we only have enough missiles for one week, two weeks, 346 00:17:45,080 --> 00:17:48,560 Speaker 10: three weeks, or even four weeks from a contingency perspective, 347 00:17:48,880 --> 00:17:51,119 Speaker 10: because that all went into the planning and wargaming before 348 00:17:51,160 --> 00:17:53,880 Speaker 10: this decision was ever made. From the military side, they 349 00:17:53,920 --> 00:17:56,840 Speaker 10: know they have China as a potential of consideration for 350 00:17:56,960 --> 00:18:00,080 Speaker 10: Taiwan unification in twenty twenty seven, so all of that 351 00:18:00,119 --> 00:18:03,640 Speaker 10: would have been part of that military calculation, military calculus 352 00:18:03,680 --> 00:18:05,800 Speaker 10: that they do before they even entered this war. 353 00:18:05,960 --> 00:18:06,760 Speaker 6: Colonel, thank you very much. 354 00:18:06,800 --> 00:18:09,119 Speaker 7: That's Colonel Wayne Sanders joining us alongside Becca Watser, our 355 00:18:09,160 --> 00:18:11,400 Speaker 7: colleagues here at Bloomberg. Thank you very much for the time. 356 00:18:12,000 --> 00:18:14,560 Speaker 2: Stay with us for more on Bloomberg this weekend. Right 357 00:18:14,600 --> 00:18:24,240 Speaker 2: after this, we're going to go down to Dan Williams, 358 00:18:24,240 --> 00:18:27,159 Speaker 2: who is our Jerusalem reporter. Dan, We've talked a lot 359 00:18:27,160 --> 00:18:28,679 Speaker 2: about what the situation is going on with that, but 360 00:18:28,680 --> 00:18:31,760 Speaker 2: I also want to ask you, for average everyday people, 361 00:18:31,920 --> 00:18:34,919 Speaker 2: what is the level of disruption at this time? You 362 00:18:35,080 --> 00:18:37,639 Speaker 2: mentioned you've been in and out of shelters in the 363 00:18:37,720 --> 00:18:40,480 Speaker 2: last days and weeks throughout the region. We talked to Lisa, 364 00:18:40,520 --> 00:18:44,160 Speaker 2: We've heard about travel disruptions, just disruptions of the economies. 365 00:18:44,240 --> 00:18:46,960 Speaker 2: How are people feeling about how this is going to 366 00:18:47,040 --> 00:18:50,000 Speaker 2: impact them, not just their security, but their lives for 367 00:18:50,000 --> 00:18:52,600 Speaker 2: the weeks and hopefully not but possibly months to come. 368 00:18:54,520 --> 00:18:57,840 Speaker 14: In deed, well, within ron Ovously, it's total chaos. They're 369 00:18:57,840 --> 00:19:03,440 Speaker 14: facing the decapitation of regime that's controlled or governed, ruled 370 00:19:03,480 --> 00:19:07,720 Speaker 14: their lives for almost half a century. Bombs falling intensively. 371 00:19:08,080 --> 00:19:10,280 Speaker 14: Even by the accounts of the Americans and Israelis, this 372 00:19:10,400 --> 00:19:15,520 Speaker 14: is worn an unprecedented scale, an aerial campaign for now, 373 00:19:15,880 --> 00:19:19,600 Speaker 14: so the Iranian situation would be the most dire in 374 00:19:19,640 --> 00:19:22,840 Speaker 14: the region. In Gulf Arab countries that have found themselves 375 00:19:22,840 --> 00:19:26,200 Speaker 14: in the line of fire, a very unfamiliar disruption. They 376 00:19:26,320 --> 00:19:30,439 Speaker 14: have had to a degree warning systems to go to 377 00:19:30,480 --> 00:19:34,760 Speaker 14: shelter orders that have helped them escape high casualties so far, 378 00:19:34,800 --> 00:19:39,160 Speaker 14: but nonetheless major disruptions for countries that have really assumed 379 00:19:39,160 --> 00:19:42,199 Speaker 14: that they could continue with a degree of comfort, security, 380 00:19:42,800 --> 00:19:47,440 Speaker 14: gilded existence based on the stability of financial markets energy exports, 381 00:19:47,640 --> 00:19:52,400 Speaker 14: the aviation hub that is Dubai Airports, etc. In Israelis situation, 382 00:19:52,440 --> 00:19:54,640 Speaker 14: it's rather different. It is really is a really accustomed 383 00:19:54,840 --> 00:19:57,400 Speaker 14: to this reality going back decades, but certainly the last 384 00:19:57,440 --> 00:20:00,760 Speaker 14: two and a half years of multi war. It began 385 00:20:00,840 --> 00:20:04,679 Speaker 14: with Gaza on October seventh, twenty twenty three, quickly spread 386 00:20:04,720 --> 00:20:09,440 Speaker 14: to some seven fronts, including Iran. Previously so Rainian's Sorry, 387 00:20:09,560 --> 00:20:12,960 Speaker 14: Israelis are weathered to these conditions. They understand what it 388 00:20:13,040 --> 00:20:16,320 Speaker 14: means to have go to shelter orders. Their system of 389 00:20:16,359 --> 00:20:20,080 Speaker 14: detection is actually sophisticated enough to home in on the 390 00:20:20,240 --> 00:20:23,560 Speaker 14: specific areas that are under threat of being hit by 391 00:20:23,560 --> 00:20:27,560 Speaker 14: those missiles. That spares other areas of the country unnecessary disruption. 392 00:20:27,960 --> 00:20:31,160 Speaker 14: They can continue more or less with regular lives. Nonetheless, 393 00:20:31,160 --> 00:20:33,760 Speaker 14: for the last week, schools have been closed, businesses have 394 00:20:33,760 --> 00:20:36,880 Speaker 14: been closed, people have been discouraged from assembling in public, 395 00:20:37,320 --> 00:20:40,200 Speaker 14: and Ben Gurin Airport, Israel's main gateway to the world, 396 00:20:40,600 --> 00:20:44,560 Speaker 14: has been shut. However, on Thursday, that airport began cautiously 397 00:20:44,640 --> 00:20:47,960 Speaker 14: taking in incoming flights for returning as Raelies as radies 398 00:20:48,000 --> 00:20:51,040 Speaker 14: who have been stranded abroad, and tomorrow Sunday, they say 399 00:20:51,320 --> 00:20:54,800 Speaker 14: they will resume some outgoing flights, and indeed there's some 400 00:20:55,040 --> 00:20:59,080 Speaker 14: talk potentially of officers resuming business as usual and even 401 00:20:59,160 --> 00:21:03,439 Speaker 14: children going back to schools, albeit under precautionary conditions. So 402 00:21:03,760 --> 00:21:06,960 Speaker 14: Israel inching back toward normalcy, while many in the Gulf 403 00:21:06,960 --> 00:21:10,240 Speaker 14: are experiencing themselves really in the middle of this storm 404 00:21:10,240 --> 00:21:13,920 Speaker 14: that they didn't anticipate and whose future they can't really predict. 405 00:21:14,560 --> 00:21:15,560 Speaker 6: Dan, it's been hugely. 406 00:21:15,400 --> 00:21:18,359 Speaker 7: Valuable to talk to you about Israel's strategy in this war. 407 00:21:18,560 --> 00:21:21,719 Speaker 7: And of course we've seen some incourasion, some attacks on Lebanon, 408 00:21:21,720 --> 00:21:22,880 Speaker 7: and I want to play a bit of sound here 409 00:21:22,880 --> 00:21:25,160 Speaker 7: before I ask you a question that's from Israeli Defense 410 00:21:25,200 --> 00:21:26,879 Speaker 7: Minister Israel Kats Let's take a listen to what he 411 00:21:26,880 --> 00:21:28,400 Speaker 7: had to say recently about Lebanon. 412 00:21:29,520 --> 00:21:32,960 Speaker 3: In the government of Lebanon and Lebanon will pay heavy price, 413 00:21:34,240 --> 00:21:37,800 Speaker 3: destroyed Lebanon in name cossime, they will also ruin it. 414 00:21:37,840 --> 00:21:41,280 Speaker 7: And talking about the head of hospital of ruining Lebanon 415 00:21:41,320 --> 00:21:43,639 Speaker 7: in a similar fashion. I'm curious as we see Israel 416 00:21:43,760 --> 00:21:46,960 Speaker 7: kind of going into Lebanon concern or interest in the 417 00:21:47,000 --> 00:21:49,840 Speaker 7: in Israel's kind of desire who to expand territory they're in. 418 00:21:50,280 --> 00:21:53,960 Speaker 7: How do you see the strategy visa e that country, Well, that. 419 00:21:54,000 --> 00:21:56,600 Speaker 15: Is the second front of this war for Israel. It's 420 00:21:56,640 --> 00:22:00,240 Speaker 15: fighting an equal volume both on the Lebanese and the 421 00:22:00,240 --> 00:22:04,719 Speaker 15: Iranian fronts. To judge by official statements, certainly very extensive 422 00:22:05,080 --> 00:22:08,400 Speaker 15: dispossession of Lebanese who've been dispossessed quite a few times. 423 00:22:08,440 --> 00:22:11,000 Speaker 15: During the last two and a half years of fighting. 424 00:22:11,320 --> 00:22:15,200 Speaker 15: Israel effectively ordered out the entirety of southern Lebanon south 425 00:22:15,200 --> 00:22:18,520 Speaker 15: of the Lutani River. That's about one tenth of the 426 00:22:18,560 --> 00:22:22,719 Speaker 15: country's land space. Something like a tenth or twenty percent 427 00:22:23,160 --> 00:22:25,440 Speaker 15: of the population have heated it so far. We're talking 428 00:22:25,440 --> 00:22:28,840 Speaker 15: about tens of thousands of people who fled northward for 429 00:22:28,920 --> 00:22:32,640 Speaker 15: fear of what looks like and growing Israeli ground maneuver 430 00:22:33,000 --> 00:22:35,840 Speaker 15: following a number of air strikes. These really appear set 431 00:22:36,040 --> 00:22:38,920 Speaker 15: on moving ground forces into southern leban Then they're describing 432 00:22:38,960 --> 00:22:42,560 Speaker 15: this as a necessary measure in order to finish off Hesbela. 433 00:22:42,640 --> 00:22:45,520 Speaker 15: But they're also saying, and as noted in those comments 434 00:22:45,560 --> 00:22:48,440 Speaker 15: that you add just now, that the Lebanese government actually 435 00:22:48,520 --> 00:22:51,119 Speaker 15: undertook to do this last year in the summer a 436 00:22:51,200 --> 00:22:57,000 Speaker 15: Lebanese government undertaking a resolution issued from Beirut to disarm Hezbollah, 437 00:22:57,040 --> 00:23:01,440 Speaker 15: which is part of the Lebanese fabric after all, hopefully consensually, 438 00:23:01,520 --> 00:23:05,240 Speaker 15: hopefully without any kind of bloody encounters that has not 439 00:23:05,359 --> 00:23:07,760 Speaker 15: happened so far. These realies are saying they have no 440 00:23:07,920 --> 00:23:10,920 Speaker 15: territorial claims on Lebanon, but in the absence of internal 441 00:23:11,000 --> 00:23:13,359 Speaker 15: action to remove the threat they see from what is 442 00:23:13,400 --> 00:23:17,400 Speaker 15: effectively the Cats or for Iran in Lebanon a neighboring country, 443 00:23:17,680 --> 00:23:20,159 Speaker 15: they will do the job themselves. So we're seeing a 444 00:23:20,240 --> 00:23:24,280 Speaker 15: growing presence potentially mounting to a full scale invasion of Lebanon. 445 00:23:24,280 --> 00:23:26,560 Speaker 15: That hasn't happened yet, but it's not being ruled out 446 00:23:26,600 --> 00:23:29,120 Speaker 15: by these relies and it's certainly something that's being anticipated 447 00:23:29,320 --> 00:23:30,080 Speaker 15: within Lebanon. 448 00:23:30,280 --> 00:23:32,919 Speaker 2: All Right, Dan Williams, Our Jerusalem Reporter, thank you so 449 00:23:33,000 --> 00:23:34,159 Speaker 2: much for your time this morning to. 450 00:23:34,119 --> 00:23:37,800 Speaker 4: Stay with us for more on Bloomberg this weekend. Right 451 00:23:37,840 --> 00:23:45,439 Speaker 4: after this, we want. 452 00:23:45,320 --> 00:23:47,680 Speaker 2: To turn now to Victoria Coats. She's the former deputy 453 00:23:47,760 --> 00:23:51,040 Speaker 2: National security advisor to President Trump. We also have Jen Gavito, 454 00:23:51,119 --> 00:23:53,320 Speaker 2: she's a senior advisor at the Cohen Group, and she 455 00:23:53,400 --> 00:23:56,160 Speaker 2: was the acting Presidental Deputy Assistant Secretary for Near East 456 00:23:56,160 --> 00:23:59,199 Speaker 2: Affairs for President Biden. Thank you both so much for 457 00:23:59,280 --> 00:24:01,640 Speaker 2: being with us. Victoria, I want to start with you 458 00:24:01,680 --> 00:24:05,000 Speaker 2: because I'm wondering as you heard and listened or read, 459 00:24:05,160 --> 00:24:08,800 Speaker 2: whichever your preferred method of communication was this morning, that 460 00:24:09,119 --> 00:24:14,159 Speaker 2: truth social tweet from President Trump this morning, telegraphing to 461 00:24:14,200 --> 00:24:18,080 Speaker 2: Iran that incoming fire, incoming fury is heading their way. 462 00:24:18,560 --> 00:24:21,879 Speaker 2: What is your reaction to both the language itself and 463 00:24:22,040 --> 00:24:24,600 Speaker 2: to that kind of strategy saying openly this is what 464 00:24:24,640 --> 00:24:26,560 Speaker 2: we're going to do, We're going to hate. What is 465 00:24:26,600 --> 00:24:29,040 Speaker 2: the President trying to do with that messaging? 466 00:24:30,280 --> 00:24:32,720 Speaker 16: Well, I think the President justifiably has a great deal 467 00:24:32,720 --> 00:24:36,120 Speaker 16: of confidence as we entered the second week of this 468 00:24:36,560 --> 00:24:41,200 Speaker 16: war against Iran. I think we've been enormously successful in 469 00:24:41,240 --> 00:24:45,360 Speaker 16: degrading their ability to fire off these ballistic missiles. Obviously 470 00:24:45,359 --> 00:24:47,400 Speaker 16: they can still do it. We need to be mindful 471 00:24:47,400 --> 00:24:50,040 Speaker 16: of that and of the drones, but our ability and 472 00:24:50,080 --> 00:24:53,480 Speaker 16: that of our allies intercept them has been pretty seamless. 473 00:24:53,600 --> 00:24:56,320 Speaker 16: And I think he's also saying that with that kind 474 00:24:56,359 --> 00:24:59,840 Speaker 16: of air superiority that we have demonstrated, we can now 475 00:25:00,080 --> 00:25:04,280 Speaker 16: use non stealth aircraft to bomb Iran, so the tempo 476 00:25:04,400 --> 00:25:07,000 Speaker 16: of the bombing will pick up. And so his message 477 00:25:07,000 --> 00:25:09,640 Speaker 16: all along has been if you lay down your arms, 478 00:25:09,640 --> 00:25:12,400 Speaker 16: if you sue for amnesty, you will be treated with respect, 479 00:25:12,440 --> 00:25:15,119 Speaker 16: you will be part of the rebuilding of Iran. But 480 00:25:15,200 --> 00:25:17,720 Speaker 16: if you don't, we're going to use overwhelming force. I 481 00:25:17,720 --> 00:25:19,600 Speaker 16: think that was the message this morning. 482 00:25:19,760 --> 00:25:21,639 Speaker 7: Jeckofio, I want to turn to you on this point. 483 00:25:21,640 --> 00:25:23,200 Speaker 7: We've talked a lot over the course of the morning 484 00:25:23,240 --> 00:25:25,960 Speaker 7: about the various rationales that we've heard from the President 485 00:25:26,000 --> 00:25:28,560 Speaker 7: and from members of his administration as well. It was 486 00:25:28,600 --> 00:25:31,399 Speaker 7: only yesterday we saw that post about unconditional surrender, and 487 00:25:31,440 --> 00:25:34,600 Speaker 7: now we see this post from the president today. Do 488 00:25:34,680 --> 00:25:36,680 Speaker 7: you have a clearer sense on this Saturday morning of 489 00:25:36,720 --> 00:25:38,720 Speaker 7: what the president's objectives here are and what is that 490 00:25:38,760 --> 00:25:41,120 Speaker 7: message from the president on truth social today? Tell you 491 00:25:41,640 --> 00:25:44,200 Speaker 7: about his tack about his strategy going forward. 492 00:25:46,200 --> 00:25:47,040 Speaker 12: Thanks for having me. 493 00:25:47,640 --> 00:25:49,880 Speaker 17: I think there is still a lot of mixed messaging 494 00:25:49,920 --> 00:25:52,239 Speaker 17: coming out of this administration about what the objectives are. 495 00:25:52,280 --> 00:25:55,600 Speaker 17: I think Victoria is absolutely right that if you frame 496 00:25:55,680 --> 00:26:02,120 Speaker 17: things in an operational sense, then the very positive messaging 497 00:26:02,160 --> 00:26:06,040 Speaker 17: about what's been achieved makes sense. But they're continue including 498 00:26:06,080 --> 00:26:09,600 Speaker 17: yesterday with the President's truth social post. As well been 499 00:26:09,720 --> 00:26:13,639 Speaker 17: suggestions that unconditional surrender regime change actually remains on the 500 00:26:13,680 --> 00:26:16,639 Speaker 17: table as an objective, and that is much different than 501 00:26:16,640 --> 00:26:20,760 Speaker 17: the operational successes that we've seen, something that would I think, 502 00:26:20,840 --> 00:26:23,360 Speaker 17: draw the United States and Israel into a much longer term, 503 00:26:23,400 --> 00:26:29,200 Speaker 17: open ended conflict with less quantifiable results, fewer metrics to 504 00:26:29,560 --> 00:26:33,440 Speaker 17: measure success by. And so when I see these posts 505 00:26:33,480 --> 00:26:35,359 Speaker 17: over the course of the last twenty four hours, what 506 00:26:35,400 --> 00:26:38,520 Speaker 17: it says to me is the administration has not yet 507 00:26:38,560 --> 00:26:44,119 Speaker 17: settled on what exactly success is defined by. 508 00:26:43,960 --> 00:26:46,480 Speaker 2: Rytoria, I'm wondering. We've had a lot of talk about 509 00:26:46,880 --> 00:26:49,200 Speaker 2: how the duration of this, how long it could go, 510 00:26:49,680 --> 00:26:52,760 Speaker 2: whether or not Aroan. One of the things that was 511 00:26:52,800 --> 00:26:55,399 Speaker 2: in the negotiating to begin with was the supply of 512 00:26:55,680 --> 00:26:58,840 Speaker 2: intermediate and short range missiles, and that was never really 513 00:26:58,840 --> 00:27:00,600 Speaker 2: something around was willing to go on the table with. 514 00:27:01,160 --> 00:27:03,840 Speaker 2: But it is still unclear to a lot of analysts 515 00:27:03,920 --> 00:27:07,560 Speaker 2: how many of those AARAN has, how long they can 516 00:27:07,680 --> 00:27:10,199 Speaker 2: last in this conflict. Iran is now saying, you know, 517 00:27:10,240 --> 00:27:12,200 Speaker 2: we're in it for the long haul. The US is saying, 518 00:27:12,280 --> 00:27:14,639 Speaker 2: we are stocked up, We're ready to go. Do we 519 00:27:14,680 --> 00:27:17,119 Speaker 2: have any idea what kind of capacity Iran has to 520 00:27:17,160 --> 00:27:20,520 Speaker 2: continue fighting back at this tempo? And do we know 521 00:27:20,840 --> 00:27:23,800 Speaker 2: what is your assessment of their nuclear program following those 522 00:27:23,840 --> 00:27:26,879 Speaker 2: strikes from the US last summer, after which the President 523 00:27:26,920 --> 00:27:30,239 Speaker 2: said their program has been destroyed. Do we know if 524 00:27:30,320 --> 00:27:32,480 Speaker 2: that's true and if they were able to rebuild before 525 00:27:32,480 --> 00:27:33,720 Speaker 2: this recent round of attacks. 526 00:27:34,920 --> 00:27:37,280 Speaker 16: Well, I think we're learning a great deal more about 527 00:27:37,320 --> 00:27:39,880 Speaker 16: their supplies of missiles, and we figured out that they've 528 00:27:39,960 --> 00:27:43,280 Speaker 16: kept them in the so called underground missile cities, which 529 00:27:43,320 --> 00:27:46,879 Speaker 16: once you identify them, are fairly easy to neutralize, and 530 00:27:46,920 --> 00:27:48,520 Speaker 16: then you can just watch them. If they try to 531 00:27:48,560 --> 00:27:51,400 Speaker 16: bring anything out, you can hit it. So I think 532 00:27:51,880 --> 00:27:55,720 Speaker 16: with the missiles, we're pretty well underway toward neutralizing that thread. 533 00:27:55,760 --> 00:27:58,240 Speaker 16: And that was one of the key metrics the President 534 00:27:58,320 --> 00:28:00,480 Speaker 16: laid out at the beginning of the COMFT like is 535 00:28:00,560 --> 00:28:04,840 Speaker 16: that neutralizing those missiles and destroying their ability to rebuild 536 00:28:04,880 --> 00:28:08,360 Speaker 16: them was critical in terms of the nuclear program. That's 537 00:28:08,400 --> 00:28:10,880 Speaker 16: more of an open ended question. I think we did 538 00:28:10,920 --> 00:28:16,960 Speaker 16: see increasing activity around ForDeal, around Pickaxe Mountain. That's one 539 00:28:16,960 --> 00:28:19,640 Speaker 16: of the things that I think got everyone's concerns up 540 00:28:19,680 --> 00:28:23,680 Speaker 16: that they were moving towards weaponization of that nuclear program. 541 00:28:23,720 --> 00:28:27,080 Speaker 16: We know there are eight hundred pounds of enriched uranium. 542 00:28:27,280 --> 00:28:30,280 Speaker 16: Some say sixty percent, some say closer to eighty percent. 543 00:28:30,520 --> 00:28:32,760 Speaker 16: But either way, you can make a weapon out of 544 00:28:32,760 --> 00:28:36,520 Speaker 16: that material, and that is unaccounted for. Apparently the Rantings 545 00:28:36,600 --> 00:28:40,400 Speaker 16: told Steve Witcoff and Jared Kushner they weren't willing to 546 00:28:40,440 --> 00:28:45,040 Speaker 16: relinquish that. Again, that's something else that motivated this attack. 547 00:28:45,440 --> 00:28:49,680 Speaker 16: So we have obviously the capacity the heavy bombers to 548 00:28:49,720 --> 00:28:52,960 Speaker 16: take care of those facilities. I think that will be 549 00:28:53,040 --> 00:28:56,000 Speaker 16: the next phase of this of this action will be 550 00:28:56,120 --> 00:28:58,880 Speaker 16: to make sure that that is truly destroyed. 551 00:28:59,360 --> 00:29:00,600 Speaker 3: Victory, let me ask you a question. 552 00:29:00,600 --> 00:29:02,600 Speaker 7: That's the variation of when I asked the former Secretary 553 00:29:02,600 --> 00:29:05,360 Speaker 7: of State Anthony Blincoln this week, and that is when 554 00:29:05,400 --> 00:29:08,000 Speaker 7: you were in the administration and gaming out what might 555 00:29:08,040 --> 00:29:09,960 Speaker 7: happen if there were to be this kind of conflagration 556 00:29:10,280 --> 00:29:14,040 Speaker 7: in Iran, what did it look like as it spread regionally? 557 00:29:14,040 --> 00:29:17,040 Speaker 7: And does it compare closely to what we're seeing right now? 558 00:29:17,080 --> 00:29:18,920 Speaker 7: In other words, is the reaction commenced with what you 559 00:29:18,960 --> 00:29:21,560 Speaker 7: and your colleagues would have expected back in the first term. 560 00:29:22,840 --> 00:29:24,840 Speaker 16: Well, our approach was a little bit different in the 561 00:29:24,840 --> 00:29:27,600 Speaker 16: first term, because we were trying to manage the situation 562 00:29:27,880 --> 00:29:32,960 Speaker 16: through the maximum pressure campaign, through the really devastating economic sanctions, 563 00:29:33,000 --> 00:29:35,960 Speaker 16: which I think had they been giving a little bit 564 00:29:35,960 --> 00:29:39,200 Speaker 16: more time, we're pretty close to pushing around to the brink. 565 00:29:39,280 --> 00:29:42,040 Speaker 16: And certainly the economic distress you saw in Iran around 566 00:29:42,120 --> 00:29:47,480 Speaker 16: Christmas which motivated those popular demonstrations, I mean that weakness 567 00:29:47,520 --> 00:29:51,520 Speaker 16: still endures, it's now worse. They can't fix that, and 568 00:29:51,600 --> 00:29:54,479 Speaker 16: so I'm a little bit less concerned about a broader 569 00:29:54,520 --> 00:29:58,080 Speaker 16: regional war. Iran's experience with broader regional wars have not 570 00:29:58,200 --> 00:30:02,360 Speaker 16: been positive, primarily Rock War, and since the nineteen eighties 571 00:30:02,400 --> 00:30:07,040 Speaker 16: they've tended to rely on their regional proxies to attack 572 00:30:07,440 --> 00:30:11,040 Speaker 16: rather than directly engaging in a regional war. So my 573 00:30:11,120 --> 00:30:14,760 Speaker 16: guess is that's what they're trying to do now with Hesblah. Interestingly, 574 00:30:14,800 --> 00:30:18,600 Speaker 16: Hamas has been essentially silent in Gaza, perhaps speaking to 575 00:30:18,640 --> 00:30:21,080 Speaker 16: the fact that they're pretty much in disarray. Same for 576 00:30:21,120 --> 00:30:23,920 Speaker 16: the Hujis, so that's kind of an interesting development as well. 577 00:30:24,480 --> 00:30:26,280 Speaker 2: And Jen, we've got about thirty seconds before we go, 578 00:30:26,400 --> 00:30:29,680 Speaker 2: but I'm wondering if you see a diplomatic off ramp 579 00:30:29,720 --> 00:30:32,400 Speaker 2: here and how you think the administration might be able 580 00:30:32,440 --> 00:30:33,440 Speaker 2: to drive down it. 581 00:30:34,560 --> 00:30:37,080 Speaker 17: Sure, I think for all the reasons Victoria just laid out, 582 00:30:37,640 --> 00:30:40,560 Speaker 17: there is plenty of operational success that's been achieved and 583 00:30:40,600 --> 00:30:43,680 Speaker 17: will continue to be achieved through this campaign, particularly in 584 00:30:43,760 --> 00:30:47,160 Speaker 17: limiting Iran's ability to project power outside of its own borders, 585 00:30:47,160 --> 00:30:51,239 Speaker 17: which was one of the early objectives that we suggested. So, 586 00:30:51,680 --> 00:30:53,840 Speaker 17: you know, I think there's a scenario by which you 587 00:30:54,200 --> 00:30:58,400 Speaker 17: claim success in those areas. You acknowledge that wisdom and 588 00:30:58,480 --> 00:31:03,520 Speaker 17: knowledge cannot be eliminated quite as easily, and you still 589 00:31:03,520 --> 00:31:07,200 Speaker 17: have a very ideological regime in place that will likely 590 00:31:07,240 --> 00:31:10,000 Speaker 17: continue to be in place. So you know, this may 591 00:31:10,000 --> 00:31:13,520 Speaker 17: not be the only long term solution, but I think 592 00:31:13,520 --> 00:31:16,040 Speaker 17: that there could be an offernt by which the administration 593 00:31:16,160 --> 00:31:19,120 Speaker 17: is real claim success in the weeks ahead. Again, if 594 00:31:19,120 --> 00:31:23,360 Speaker 17: you continue to talk about regime change, that changes that calculus. 595 00:31:23,800 --> 00:31:26,160 Speaker 2: All right, Thank you so much, Jencivido. She's senior advisor 596 00:31:26,240 --> 00:31:28,719 Speaker 2: the Coen Group and of course, former acting Principal Deputy 597 00:31:28,800 --> 00:31:32,320 Speaker 2: Assistant Secretary for Near East Affairs for the State Department. 598 00:31:32,400 --> 00:31:36,280 Speaker 2: Victoria Coates, former National Deputy Secretary Advisor to President Trump 599 00:31:36,320 --> 00:31:41,280 Speaker 2: and President Vice President Patts. Thanks for joining us on 600 00:31:41,280 --> 00:31:44,360 Speaker 2: today's Bloomberg This Weekend podcast. Don't forget to tune in 601 00:31:44,400 --> 00:31:47,160 Speaker 2: live for the show every Saturday and Sunday morning, starting 602 00:31:47,160 --> 00:31:48,200 Speaker 2: at seven am Eastern. 603 00:31:48,280 --> 00:31:51,280 Speaker 3: We're on Bloomberg Television Radio and the Bloomberg Business App, 604 00:31:51,400 --> 00:31:55,520 Speaker 3: bringing you unique takes and in depth interviews on news, politics, lifestyle, 605 00:31:55,640 --> 00:31:56,160 Speaker 3: and culture.