1
00:00:02,520 --> 00:00:07,000
Speaker 1: Bloomberg Audio Studios, podcasts, radio news.

2
00:00:09,920 --> 00:00:12,440
Speaker 2: This is the Blueberg Day Bacot podcast. Good morning, It's

3
00:00:12,480 --> 00:00:16,079
Speaker 2: fined the twentieth of March. I'm Caroline Hepkeitt in London.

4
00:00:16,120 --> 00:00:19,239
Speaker 3: And I'm Stephen Carroll and Brussels coming up today. Oil

5
00:00:19,320 --> 00:00:23,400
Speaker 3: prices fall as the US and Israel offer reassurances on

6
00:00:23,520 --> 00:00:25,160
Speaker 3: Middle East strike targets.

7
00:00:25,640 --> 00:00:29,280
Speaker 2: Europe confronts a multi year energy squeeze as the Bank

8
00:00:29,320 --> 00:00:32,479
Speaker 2: of England and European Central Bank raised the prospect of

9
00:00:32,600 --> 00:00:33,680
Speaker 2: interest rate hikes.

10
00:00:34,240 --> 00:00:36,479
Speaker 4: Plus Trump still wants Greenland.

11
00:00:36,600 --> 00:00:39,720
Speaker 3: Denmark's prime minister says the US President hasn't lost his

12
00:00:39,800 --> 00:00:41,760
Speaker 3: desire to take over the island.

13
00:00:42,240 --> 00:00:44,120
Speaker 2: Let's start with a round up of our top stories.

14
00:00:44,200 --> 00:00:47,000
Speaker 3: Price of oil has dropped from its highest closing position

15
00:00:47,080 --> 00:00:49,600
Speaker 3: in more than three and a half years. The leaders

16
00:00:49,640 --> 00:00:52,320
Speaker 3: of the US and Israel have been scrambling to reassure

17
00:00:52,360 --> 00:00:55,840
Speaker 3: world leaders and markets rattled by damage to major energy

18
00:00:55,880 --> 00:00:59,320
Speaker 3: facilities in the Middle East. Israel's Prime Minister Benjamin Ettannie

19
00:00:59,360 --> 00:01:03,400
Speaker 3: who said his country would no longer target energy infrastructure

20
00:01:03,640 --> 00:01:08,000
Speaker 3: after its attack on an Iranian gas field sparked retaliatory strikes.

21
00:01:09,040 --> 00:01:14,080
Speaker 5: Israel acted alone against the SLOWEA gas compound fact number two.

22
00:01:14,480 --> 00:01:18,440
Speaker 5: President Trump asked us to hold off on future attacks,

23
00:01:18,520 --> 00:01:19,240
Speaker 5: and we're holding out.

24
00:01:20,280 --> 00:01:24,600
Speaker 3: Benjaminattaniaw, whose comments came after is Israeli officials previously said

25
00:01:24,680 --> 00:01:28,200
Speaker 3: they had informed the US about the attack. Speaking from

26
00:01:28,240 --> 00:01:30,720
Speaker 3: the White Ice, President Trump said that he had told Natanya,

27
00:01:30,800 --> 00:01:34,120
Speaker 3: who don't do that, and he also tried to downplay

28
00:01:34,160 --> 00:01:35,800
Speaker 3: the recent jumps and oil prices.

29
00:01:36,200 --> 00:01:38,920
Speaker 6: I wanted to put out that fire, and I said,

30
00:01:38,920 --> 00:01:41,160
Speaker 6: you know, we do that. Oil prices will go up,

31
00:01:41,200 --> 00:01:42,160
Speaker 6: the economy will go.

32
00:01:42,200 --> 00:01:42,920
Speaker 4: Down a little bit.

33
00:01:43,160 --> 00:01:46,160
Speaker 6: I feel it would be worse, much worse. Actually, I

34
00:01:46,160 --> 00:01:47,880
Speaker 6: thought there was a chance it could be much worse.

35
00:01:47,960 --> 00:01:49,520
Speaker 6: It's not bad, and it's going to be over with

36
00:01:49,560 --> 00:01:50,120
Speaker 6: pretty soon.

37
00:01:50,840 --> 00:01:54,680
Speaker 3: President Trump also told reporters he is not putting troops anywhere.

38
00:01:54,800 --> 00:01:57,559
Speaker 4: Quote. If I were, I certainly wouldn't tell you.

39
00:01:58,200 --> 00:02:01,040
Speaker 3: Sources tell Bloomberg that the Pentagon ask Congress for an

40
00:02:01,080 --> 00:02:04,160
Speaker 3: additional two hundred billion dollars to pay for the war,

41
00:02:04,600 --> 00:02:07,920
Speaker 3: despite claims to the country. This enormous funding request suggests

42
00:02:07,960 --> 00:02:10,680
Speaker 3: the US as preparing for a protracted conflict.

43
00:02:12,000 --> 00:02:15,080
Speaker 2: Iran's latest strike on Cutton is set to cost the

44
00:02:15,120 --> 00:02:18,880
Speaker 2: country's state energy company about twenty billion dollars in lost

45
00:02:18,919 --> 00:02:22,040
Speaker 2: revenue and could take up to five years to be repaired.

46
00:02:22,520 --> 00:02:26,360
Speaker 2: Missiles damaged the world's largest liquivide natural gas export facility

47
00:02:26,720 --> 00:02:31,800
Speaker 2: at Raslafan, which had already halted production following a previous attack.

48
00:02:32,200 --> 00:02:36,239
Speaker 2: Sally Yilmaz is senior oil analyst for Blue Big Intelligence.

49
00:02:36,960 --> 00:02:41,440
Speaker 7: There is about seventeen percent of the whole facility that's damaged,

50
00:02:41,720 --> 00:02:44,000
Speaker 7: and what was really surprising to me was that the

51
00:02:44,080 --> 00:02:46,480
Speaker 7: CEO of cut Our Energy said it would take up

52
00:02:46,520 --> 00:02:50,480
Speaker 7: to three years to fix this damage, which is I

53
00:02:50,520 --> 00:02:53,560
Speaker 7: mean definitely longer than I would have imagined.

54
00:02:54,480 --> 00:02:58,160
Speaker 2: That was Bloomberg Intelligence is Sally Yilmaz. According to the

55
00:02:58,280 --> 00:03:02,280
Speaker 2: statement from Qatar Energy GZ CEO Saad al Kabi, the

56
00:03:02,360 --> 00:03:06,280
Speaker 2: impact will be felt by China, South Korea, Italy and Belgium.

57
00:03:06,360 --> 00:03:08,760
Speaker 2: He also added that the firm will be compelled to

58
00:03:08,840 --> 00:03:12,000
Speaker 2: declare force measure for up to five years on some

59
00:03:12,200 --> 00:03:14,639
Speaker 2: long term LNG contracts.

60
00:03:15,919 --> 00:03:18,800
Speaker 3: The EU is bracing for a multi year energy price

61
00:03:18,880 --> 00:03:22,320
Speaker 3: squeeze as the Iran war disrupts supplies. During a meeting

62
00:03:22,440 --> 00:03:25,680
Speaker 3: in Brussels, European leaders warned about the severity of the

63
00:03:25,720 --> 00:03:29,559
Speaker 3: situation and called for a moratorium on strikes against energy facilities.

64
00:03:29,919 --> 00:03:33,400
Speaker 3: European Commissioned President ur Slevanderline says the EU will propose measures,

65
00:03:33,440 --> 00:03:37,080
Speaker 3: including cutting taxes on electricity and an extra thirty billion

66
00:03:37,120 --> 00:03:39,320
Speaker 3: euros to fund decarbonization efforts.

67
00:03:40,360 --> 00:03:44,240
Speaker 8: The gas price went up by thirty percent after tax

68
00:03:44,320 --> 00:03:49,520
Speaker 8: on Katari gas infrastructure. These are reckless attacks on infrastructure

69
00:03:49,520 --> 00:03:54,080
Speaker 8: and unarmed commercial vessels that raise costs and the question

70
00:03:54,160 --> 00:03:59,400
Speaker 8: of future supply risks. So in order to minimize the impact,

71
00:04:00,080 --> 00:04:01,160
Speaker 8: we must take action.

72
00:04:02,360 --> 00:04:02,680
Speaker 4: EARTHL.

73
00:04:02,760 --> 00:04:05,640
Speaker 3: Vonderlin was speaking as European natural gas prices serves to

74
00:04:05,680 --> 00:04:09,080
Speaker 3: their highest in three years. The European Central Banks as

75
00:04:09,120 --> 00:04:12,600
Speaker 3: a prolonged disruption would push Eurozone inflation to six point

76
00:04:12,680 --> 00:04:15,560
Speaker 3: three percent and trigger a brief recession.

77
00:04:16,520 --> 00:04:19,760
Speaker 2: European Central Bank officials see the possibility of an interest

78
00:04:19,880 --> 00:04:24,120
Speaker 2: rate hike at next month's meeting. Bloomberg understands that policymakers

79
00:04:24,520 --> 00:04:27,239
Speaker 2: would be ready to raise boring costs in April should

80
00:04:27,240 --> 00:04:30,880
Speaker 2: the Middle East conflict push inflation too far above target.

81
00:04:31,320 --> 00:04:33,840
Speaker 2: The news comes as the ECB left its deposit rate

82
00:04:33,880 --> 00:04:38,680
Speaker 2: at two percent as expected. EASYB President Christine Lagarde acknowledged

83
00:04:38,920 --> 00:04:39,839
Speaker 2: the threats ahead.

84
00:04:41,400 --> 00:04:46,520
Speaker 1: The risks to the inflation outlook are tilted to the upside,

85
00:04:46,960 --> 00:04:50,760
Speaker 1: especially in the neo term. A prolonged war in the

86
00:04:50,760 --> 00:04:55,000
Speaker 1: Middle East could lead to a larger and longer lasting

87
00:04:55,200 --> 00:05:00,640
Speaker 1: upward shift in energy prices than currently expected, seeing eural

88
00:05:00,760 --> 00:05:02,520
Speaker 1: area inflation further.

89
00:05:03,720 --> 00:05:07,200
Speaker 2: European Central Bank President Christina Guard speaking after the interest

90
00:05:07,279 --> 00:05:11,320
Speaker 2: rate decision, an ECB spokesperson declined to comment on the

91
00:05:11,360 --> 00:05:15,039
Speaker 2: reports about a potential hike. Meanwhile, Governing Council member and

92
00:05:15,120 --> 00:05:18,320
Speaker 2: Greek Central Bank chief yannist so Nalez warned that the

93
00:05:18,560 --> 00:05:22,719
Speaker 2: war could have significant economic consequences if it continues.

94
00:05:23,600 --> 00:05:26,279
Speaker 3: Governor Andrew Bailey says the Bank of England stands ready

95
00:05:26,320 --> 00:05:29,480
Speaker 3: to act against a surge in inflation, sparking a major

96
00:05:29,560 --> 00:05:32,000
Speaker 3: move in bets on a rate hike. The Central Banks

97
00:05:32,000 --> 00:05:35,200
Speaker 3: policymakers voted unanimously to keep rates on hold at three

98
00:05:35,240 --> 00:05:38,560
Speaker 3: point seventy five percent, but Andrew Bailey warned the bank

99
00:05:38,640 --> 00:05:40,440
Speaker 3: is now looking at a very different future.

100
00:05:41,560 --> 00:05:44,640
Speaker 9: We've held and strike because it has been, of course

101
00:05:44,680 --> 00:05:47,520
Speaker 9: a huge change since we last met as a committee,

102
00:05:47,760 --> 00:05:49,520
Speaker 9: and that is the outbreak of the conflict in the

103
00:05:49,560 --> 00:05:52,279
Speaker 9: Middle East and the impact that's having on energy prices

104
00:05:53,040 --> 00:05:56,360
Speaker 9: and therefore is and will have in terms of prices

105
00:05:56,400 --> 00:05:59,160
Speaker 9: in this country. Now there are also of courses been

106
00:05:59,160 --> 00:06:02,360
Speaker 9: a huge increase and very short run uncertain thing and

107
00:06:02,440 --> 00:06:04,440
Speaker 9: none of us know how this is going to play out.

108
00:06:04,680 --> 00:06:07,720
Speaker 3: Underlining Andrew Bailey's words, one of the Bee's most Jovish official,

109
00:06:07,800 --> 00:06:11,040
Speaker 3: Swati Dinger, now says that a hike may be needed.

110
00:06:11,920 --> 00:06:14,839
Speaker 3: The Harkish Turner's prompted traders to pencil in two interest

111
00:06:14,920 --> 00:06:17,280
Speaker 3: rate increases by the Bank of England by the end

112
00:06:17,440 --> 00:06:17,760
Speaker 3: of the.

113
00:06:17,800 --> 00:06:22,080
Speaker 2: Year, and in other news, Denmark's Prime minister says that

114
00:06:22,160 --> 00:06:26,240
Speaker 2: the US still wants to acquire Greenland. Measure Friedrichson told

115
00:06:26,279 --> 00:06:30,280
Speaker 2: reporters in Brussels that negotiations are underway with Washington after

116
00:06:30,320 --> 00:06:33,400
Speaker 2: a framework agreement was reached in January, but the situation

117
00:06:33,680 --> 00:06:38,760
Speaker 2: is serious. Denmark's public broadcast of dr recently revealed that

118
00:06:38,920 --> 00:06:43,919
Speaker 2: Copenhagen deployed troops to Greenland in January with the intention

119
00:06:44,480 --> 00:06:49,000
Speaker 2: of blowing up its runways should the US invade. Denmark

120
00:06:49,080 --> 00:06:52,160
Speaker 2: is set to vote in an early general election next week,

121
00:06:52,440 --> 00:06:56,320
Speaker 2: framed around defense and the country's relationship with the US.

122
00:06:57,120 --> 00:06:59,640
Speaker 2: Those are our top stories for you this morning looking

123
00:06:59,680 --> 00:07:03,599
Speaker 2: at the markets, oil prices declining after the surge yesterday.

124
00:07:03,800 --> 00:07:05,960
Speaker 2: Brent crude is trading just above one hundred and six

125
00:07:06,040 --> 00:07:08,840
Speaker 2: dollars a barrel, down by one point seven percent. WTI

126
00:07:08,880 --> 00:07:11,440
Speaker 2: crew at ninety three dollars, So it looks like a

127
00:07:11,480 --> 00:07:14,720
Speaker 2: weekly gain of about four percent for Brent wtrn Apatho

128
00:07:15,080 --> 00:07:18,920
Speaker 2: to drop on a weekly basis five percent. But more importantly,

129
00:07:19,560 --> 00:07:23,320
Speaker 2: fuel prices for things like jet fuel, cooking gas are

130
00:07:23,400 --> 00:07:26,320
Speaker 2: surging around the world. You'repeining that gas prices of surge

131
00:07:26,560 --> 00:07:29,800
Speaker 2: by almost double since before the war Inlebran. No cash

132
00:07:29,800 --> 00:07:32,360
Speaker 2: treasury is trading at Japan closed for holiday. Ten year

133
00:07:32,360 --> 00:07:35,960
Speaker 2: OZSI yields surging to the highest in almost fifteen years

134
00:07:36,000 --> 00:07:39,760
Speaker 2: five percent for the ten year UK yields jumping thirty

135
00:07:39,760 --> 00:07:42,160
Speaker 2: one basis points yesterday to four point four percent. So

136
00:07:42,240 --> 00:07:46,320
Speaker 2: bond markets clearly seeing a real worry about inflation being

137
00:07:46,800 --> 00:07:50,920
Speaker 2: pricing and increasingly the dollar strengthens, the Indian rupee weekends

138
00:07:50,920 --> 00:07:53,240
Speaker 2: and the end of a tough week for gold. But

139
00:07:53,360 --> 00:07:56,119
Speaker 2: actually gold is up now nine tenths this morning.

140
00:07:56,120 --> 00:07:58,280
Speaker 4: Those are the markets in a moment.

141
00:07:58,400 --> 00:08:01,280
Speaker 3: More on how the energy supply disruption from the Iran

142
00:08:01,360 --> 00:08:04,760
Speaker 3: war is moving markets, plus how EU leaders plan to

143
00:08:04,800 --> 00:08:08,320
Speaker 3: manage the price bike for European consumers and businesses. But

144
00:08:08,400 --> 00:08:11,679
Speaker 3: another story that we've been reading this morning about how

145
00:08:11,880 --> 00:08:15,720
Speaker 3: traders are now turning to AI for help to try

146
00:08:15,760 --> 00:08:18,320
Speaker 3: and keep up with the flow of news out of

147
00:08:18,560 --> 00:08:21,200
Speaker 3: the Middle East. Bloombergsmen speaking to lots of investors to

148
00:08:21,280 --> 00:08:24,600
Speaker 3: understand how they're using large language models and their investment

149
00:08:24,680 --> 00:08:29,000
Speaker 3: decisions as well. It's very interesting to see how they're

150
00:08:29,040 --> 00:08:33,600
Speaker 3: talking about it's speeding up the research end of decision making,

151
00:08:33,679 --> 00:08:37,480
Speaker 3: but they're still being an element of I suppose human

152
00:08:37,520 --> 00:08:42,080
Speaker 3: discretion or human insight needed to make the actual trades.

153
00:08:42,200 --> 00:08:45,800
Speaker 3: But the conversation, certainly with those that our colleagues have

154
00:08:45,840 --> 00:08:48,440
Speaker 3: been speaking to, does seem to indicate that this is

155
00:08:48,640 --> 00:08:50,760
Speaker 3: a huge part of their day to day work now.

156
00:08:51,080 --> 00:08:54,120
Speaker 2: Yeah, absolutely, whether it's chat, GBT or claude, whether it's

157
00:08:54,160 --> 00:08:58,480
Speaker 2: looking back one hundred years to track every war driven

158
00:08:58,960 --> 00:09:03,840
Speaker 2: oil market impact. You know, lots of traders are using this.

159
00:09:04,000 --> 00:09:08,000
Speaker 2: It's speeding up their research, it's giving them perhaps more tools.

160
00:09:08,440 --> 00:09:12,280
Speaker 2: But lots of the investors that Bloomberg spoke to you said, look,

161
00:09:12,280 --> 00:09:17,120
Speaker 2: it doesn't replace human beings, at least not yet, so

162
00:09:17,559 --> 00:09:18,080
Speaker 2: we don't know what.

163
00:09:19,640 --> 00:09:22,559
Speaker 3: The prospect of it's going to be replaced by IGBT. First,

164
00:09:23,000 --> 00:09:25,360
Speaker 3: a very interesting read though from our colleagues. You can

165
00:09:25,400 --> 00:09:27,080
Speaker 3: find it on Bloomberg dot com up with a Linkdage

166
00:09:27,080 --> 00:09:30,240
Speaker 3: in our podcast show notes as well well. The global

167
00:09:30,240 --> 00:09:32,840
Speaker 3: oil market has been pitched into turmoil by the war

168
00:09:32,880 --> 00:09:36,079
Speaker 3: in the Middle East. Oil prices are down from their

169
00:09:36,240 --> 00:09:39,559
Speaker 3: peak yesterday looking at brank Crew just below one hundred

170
00:09:39,600 --> 00:09:41,640
Speaker 3: and seven dollars a barrow. Let's bring in our energy

171
00:09:41,640 --> 00:09:45,439
Speaker 3: reporter Dan Mertov for more. Dan, it was these comments

172
00:09:45,520 --> 00:09:48,080
Speaker 3: from Donald Trump and Benjamin Natta and Yahoo that appeared

173
00:09:48,120 --> 00:09:51,280
Speaker 3: to have moved those oil prices lower. How much of

174
00:09:51,320 --> 00:09:52,439
Speaker 3: an impact do they have?

175
00:09:54,200 --> 00:09:55,080
Speaker 4: It had a little bit of.

176
00:09:55,040 --> 00:09:57,000
Speaker 10: An impact certainly, and taking a little wind out of

177
00:09:57,000 --> 00:10:00,560
Speaker 10: the sales of oil prices. You know, traders are sort

178
00:10:00,559 --> 00:10:03,360
Speaker 10: of trying to meet that balance of you know, clearly

179
00:10:03,360 --> 00:10:06,560
Speaker 10: there's disruption in the market right now, but at the

180
00:10:06,559 --> 00:10:08,240
Speaker 10: same time, you know, there has been a little bit

181
00:10:08,280 --> 00:10:10,680
Speaker 10: of buffer in terms of storage. So how long that

182
00:10:10,760 --> 00:10:13,680
Speaker 10: disruption lasts ends up mattering a lot. You know, we

183
00:10:13,720 --> 00:10:15,960
Speaker 10: can we can weather a few weeks of this we

184
00:10:15,960 --> 00:10:19,200
Speaker 10: can't weather much longer. So giving people a sense that

185
00:10:19,280 --> 00:10:22,560
Speaker 10: maybe we're we're going to step back from this escalation

186
00:10:22,840 --> 00:10:27,640
Speaker 10: and you know, end the war is certainly a good

187
00:10:27,679 --> 00:10:31,360
Speaker 10: sign for the market. That being said, ultimately, you know

188
00:10:31,720 --> 00:10:34,480
Speaker 10: what really matters is the flow of oil through the

189
00:10:34,520 --> 00:10:37,679
Speaker 10: strait of worm moves, and there hasn't really been any

190
00:10:37,720 --> 00:10:40,240
Speaker 10: move on that. Uh And for there to be any

191
00:10:40,400 --> 00:10:44,840
Speaker 10: kind of real de escalation and prices and frankly to

192
00:10:45,160 --> 00:10:48,480
Speaker 10: further to stop being a rise in prices, that's what

193
00:10:48,640 --> 00:10:50,840
Speaker 10: traders are looking for. You know, all the comments from

194
00:10:50,880 --> 00:10:54,040
Speaker 10: Trump and then Yahoo, the rhetoric from Iran, none of

195
00:10:54,040 --> 00:10:56,240
Speaker 10: that will end up mattering in the end. You know,

196
00:10:56,480 --> 00:10:58,199
Speaker 10: when you look at the day end prices, it'll keep

197
00:10:58,200 --> 00:11:00,720
Speaker 10: creeping up and up and up until people start seeing

198
00:11:01,000 --> 00:11:04,280
Speaker 10: tankers flow through the straight of worm moves in large numbers.

199
00:11:05,160 --> 00:11:07,840
Speaker 2: The Trump administration seems to be focused though on the

200
00:11:07,880 --> 00:11:10,720
Speaker 2: price of WTI in terms of understanding the energy impact.

201
00:11:10,800 --> 00:11:12,960
Speaker 2: I mean, we know that President Trump is he may

202
00:11:13,000 --> 00:11:16,960
Speaker 2: comments yesterday, he is focused on the energy price impact.

203
00:11:17,080 --> 00:11:20,840
Speaker 2: But is WTI the right measure because we're also looking

204
00:11:20,880 --> 00:11:23,240
Speaker 2: at the surging costs of things like diesel, which are

205
00:11:23,400 --> 00:11:26,000
Speaker 2: surely much more important in terms of making or breaking

206
00:11:26,360 --> 00:11:28,480
Speaker 2: the economy in the US, but also globally.

207
00:11:29,360 --> 00:11:32,160
Speaker 10: Yeah, that's a great point, you know. But for somebody

208
00:11:32,280 --> 00:11:34,959
Speaker 10: like you know, Trump, who's a financial professional and real estate,

209
00:11:35,160 --> 00:11:37,760
Speaker 10: you know that you can even look on the Bloomberg terminal.

210
00:11:37,960 --> 00:11:39,920
Speaker 10: What does our main oil story say?

211
00:11:39,920 --> 00:11:40,200
Speaker 7: Every day?

212
00:11:40,200 --> 00:11:42,520
Speaker 10: It's the price of WTI, It's the price of Brent crude.

213
00:11:42,559 --> 00:11:44,720
Speaker 10: That's what the financial markets look at. But if you're

214
00:11:44,800 --> 00:11:47,360
Speaker 10: a voter in America, you're not looking at, you know,

215
00:11:47,360 --> 00:11:49,360
Speaker 10: your Bloomberg screen every day. What you're doing is you're

216
00:11:49,440 --> 00:11:52,040
Speaker 10: driving from home to work and you're passing twelve gas

217
00:11:52,080 --> 00:11:54,840
Speaker 10: stations and every one of them has a giant, you know,

218
00:11:55,160 --> 00:11:58,520
Speaker 10: blinking signal showing you the price of gasoline. And you know,

219
00:11:58,559 --> 00:12:02,080
Speaker 10: if you're a truck driver, that price of diesel is omnipresent.

220
00:12:02,240 --> 00:12:04,600
Speaker 10: So those are the real signals that American people are getting,

221
00:12:04,720 --> 00:12:06,800
Speaker 10: and like you're saying, those are rising a lot faster

222
00:12:07,559 --> 00:12:10,760
Speaker 10: than WTI, both because you know, those are influenced by

223
00:12:10,880 --> 00:12:16,120
Speaker 10: international markets. WTI is a very specific market. It's basically

224
00:12:16,160 --> 00:12:18,480
Speaker 10: oil that's stuck in the middle of Oklahoma, and so

225
00:12:18,559 --> 00:12:21,079
Speaker 10: it has a little bit of a buffer from global affairs,

226
00:12:21,480 --> 00:12:25,000
Speaker 10: and you know too, because not only are we stopping

227
00:12:25,040 --> 00:12:26,760
Speaker 10: the flow of oil from the Middle East, but there's

228
00:12:26,760 --> 00:12:28,920
Speaker 10: a lot of refineries that are shut down in the

229
00:12:28,960 --> 00:12:30,960
Speaker 10: Middle East, products that can't get out of there. So

230
00:12:31,080 --> 00:12:34,360
Speaker 10: the products market, the stuff that people actually buy and use,

231
00:12:34,559 --> 00:12:36,960
Speaker 10: that's way worse off right now than crude oil.

232
00:12:37,679 --> 00:12:40,520
Speaker 3: The question of natural gas also very much in focus,

233
00:12:41,040 --> 00:12:43,680
Speaker 3: as we had the course cut our energy saying yesterday

234
00:12:43,720 --> 00:12:47,040
Speaker 3: that the attack on that LNG plant, seventeen percent of

235
00:12:47,120 --> 00:12:50,480
Speaker 3: the l and G export capacity globally could be offline

236
00:12:50,520 --> 00:12:52,880
Speaker 3: from to five years because of damage.

237
00:12:52,880 --> 00:12:54,320
Speaker 4: How significant is that.

238
00:12:55,120 --> 00:12:57,920
Speaker 10: It's massive. You know, coming into this year, we were

239
00:12:57,960 --> 00:13:01,079
Speaker 10: expecting the LNG market to flow for what had been

240
00:13:01,200 --> 00:13:04,800
Speaker 10: quite a tight market ever since Russia invaded Ukraine, to

241
00:13:04,920 --> 00:13:07,720
Speaker 10: finally flip into a bit of overcapacity because there were

242
00:13:07,720 --> 00:13:10,640
Speaker 10: all these new plants coming on. Qatar was expanding its

243
00:13:10,760 --> 00:13:12,920
Speaker 10: razalfan plant, There's all these new energy plants in the

244
00:13:13,040 --> 00:13:15,200
Speaker 10: US that should come online this year, and so the

245
00:13:15,240 --> 00:13:18,040
Speaker 10: market was expecting prices to soften, and so you know,

246
00:13:18,200 --> 00:13:22,560
Speaker 10: lerg importers that are a little bit poorer, like Pakistan, India, Bangladesh, Thailand,

247
00:13:22,720 --> 00:13:25,760
Speaker 10: they were looking forward to having lower energy import bills,

248
00:13:25,760 --> 00:13:28,280
Speaker 10: to getting a little boost to their economic growth. But

249
00:13:28,440 --> 00:13:33,719
Speaker 10: now it's completely flipped. Qatar Razlovan facility. You cannot overstate

250
00:13:34,520 --> 00:13:37,280
Speaker 10: how important it is. It's one fifth of total global

251
00:13:37,440 --> 00:13:40,360
Speaker 10: energy supply, and it's already been caught off in the

252
00:13:40,360 --> 00:13:42,760
Speaker 10: short term because of the war, but now you know

253
00:13:43,440 --> 00:13:46,720
Speaker 10: these new attacks, this new damage that's taking it offline

254
00:13:46,720 --> 00:13:51,959
Speaker 10: for years. I mean we're already flipping into a expected

255
00:13:52,559 --> 00:13:55,160
Speaker 10: from a glut, into a period of under supply for

256
00:13:55,200 --> 00:13:57,480
Speaker 10: the rest of the year. We're looking at prices instead

257
00:13:57,480 --> 00:13:59,920
Speaker 10: of being below ten dollars above thirty for the rest

258
00:14:00,080 --> 00:14:02,640
Speaker 10: to the year. I mean it's a massive, massive hit

259
00:14:02,760 --> 00:14:05,800
Speaker 10: to a lot of emerging Asian economies that are relying

260
00:14:05,800 --> 00:14:09,959
Speaker 10: and hoping to get more more guests for cheaper, cleaner fuel.

261
00:14:10,360 --> 00:14:12,640
Speaker 2: Yeah, absolutely done. Thank you so much for being with us,

262
00:14:12,640 --> 00:14:15,360
Speaker 2: Bloomberg Energy reported Dan Murta. I will give credit though

263
00:14:15,559 --> 00:14:17,880
Speaker 2: where it's due to havevier blast. Of course, he was

264
00:14:17,960 --> 00:14:21,280
Speaker 2: one that has been pointing out this difference between w TR,

265
00:14:21,320 --> 00:14:23,240
Speaker 2: whether that's the benchmark to look at or whether it's

266
00:14:23,280 --> 00:14:27,880
Speaker 2: actually the other fuel prices jet fuel, diesel and so on.

267
00:14:28,000 --> 00:14:30,680
Speaker 2: You can read his opinion column on the BlueBag terminal.

268
00:14:32,920 --> 00:14:36,600
Speaker 2: Stay with us. More from Bloomberg Daybakeube coming up after this.

269
00:14:38,360 --> 00:14:38,520
Speaker 4: Now.

270
00:14:38,520 --> 00:14:41,560
Speaker 3: The European Union's bracing for a protracted energy price shock,

271
00:14:42,120 --> 00:14:45,360
Speaker 3: European Central Bank warning that prolonged disruption could push Eurozone

272
00:14:45,400 --> 00:14:48,920
Speaker 3: inflation above six percent. EU leaders called on the Commission

273
00:14:49,000 --> 00:14:51,240
Speaker 3: to come up with measures to limit price spikes and

274
00:14:51,320 --> 00:14:54,320
Speaker 3: accelerator review of its commissions trading system, which puts a

275
00:14:54,360 --> 00:14:57,880
Speaker 3: cost on carbon pollution. Our EU Energy and Climate reporter

276
00:14:57,960 --> 00:15:01,160
Speaker 3: John Ainger joins us now for more and Brussels this morning. John,

277
00:15:01,160 --> 00:15:02,440
Speaker 3: I know you're up to the early hours of this

278
00:15:02,480 --> 00:15:06,520
Speaker 3: morning reporting on this leader's summit. Leaders clearly very worried

279
00:15:06,520 --> 00:15:10,080
Speaker 3: about the impact of energy price rises. What can they

280
00:15:10,160 --> 00:15:12,520
Speaker 3: do about us in the short term?

281
00:15:13,480 --> 00:15:16,440
Speaker 11: Yes, Indeed, Stephen, the meeting only came to an end

282
00:15:16,480 --> 00:15:19,400
Speaker 11: a few hours ago, and I think the over riding

283
00:15:19,440 --> 00:15:23,080
Speaker 11: conclusion is that they can't really do much, if anything,

284
00:15:23,760 --> 00:15:27,000
Speaker 11: about the root cause of the problem. We know that

285
00:15:27,120 --> 00:15:31,480
Speaker 11: Europe is extremely exposed to international oil and gas markets.

286
00:15:32,040 --> 00:15:36,080
Speaker 11: We saw that during Russia's after Russia's invasion of Ukraine,

287
00:15:36,080 --> 00:15:39,800
Speaker 11: and we saw that again yesterday. Prices surged and that

288
00:15:39,880 --> 00:15:43,440
Speaker 11: has kind of proved a timely reminded to leaders about

289
00:15:43,480 --> 00:15:47,320
Speaker 11: just how exposed Europe is. So what can they do?

290
00:15:47,520 --> 00:15:51,000
Speaker 11: I mean, there are options. Indeed, we know that a

291
00:15:51,080 --> 00:15:55,800
Speaker 11: large proportion of the electricity price is made up through levees.

292
00:15:56,160 --> 00:15:59,160
Speaker 11: The European Commission has been calling on member states to

293
00:15:59,560 --> 00:16:03,520
Speaker 11: cut the those cut taxes to help out consumers, but

294
00:16:03,640 --> 00:16:06,240
Speaker 11: these are kind of solutions which come with a number

295
00:16:06,360 --> 00:16:11,200
Speaker 11: of budgetary implications, and so finance ministries across the block

296
00:16:11,320 --> 00:16:15,080
Speaker 11: are reluctant to do anything about that and have basically

297
00:16:15,120 --> 00:16:17,760
Speaker 11: been calling on the European Commission to come with even

298
00:16:17,800 --> 00:16:21,760
Speaker 11: more solutions. We're seeing as well that the EU's carbon

299
00:16:21,840 --> 00:16:25,040
Speaker 11: market is likely to be among those things that are targeted,

300
00:16:25,120 --> 00:16:27,600
Speaker 11: at least in the short term. And then we also

301
00:16:27,680 --> 00:16:31,760
Speaker 11: saw the likes of Italy's Prime Minister Georgia Maloney kind

302
00:16:31,760 --> 00:16:34,040
Speaker 11: of coming out of the meeting saying that the European

303
00:16:34,040 --> 00:16:37,760
Speaker 11: Commission had provided her with insurances that it would kind

304
00:16:37,800 --> 00:16:40,560
Speaker 11: of look the other way in terms of some of

305
00:16:40,600 --> 00:16:44,080
Speaker 11: the support it's providing directly into the energy markets.

306
00:16:44,400 --> 00:16:47,720
Speaker 2: Okay, so that's interesting. Well that on the specifics of

307
00:16:47,760 --> 00:16:51,800
Speaker 2: the energy emission trading system, the leaders agreed on a

308
00:16:51,840 --> 00:16:56,280
Speaker 2: broad review of the emission trading system to happen by July.

309
00:16:56,880 --> 00:16:59,160
Speaker 2: What kinds of changes do you think are likely and

310
00:16:59,600 --> 00:17:02,920
Speaker 2: how might that actually help with higher energy costs.

311
00:17:03,560 --> 00:17:06,120
Speaker 11: Yeah, so, firstly, just to kind of put it into

312
00:17:06,200 --> 00:17:09,760
Speaker 11: a bit of context, I mean, the EU's emissions trading system,

313
00:17:09,840 --> 00:17:13,159
Speaker 11: it puts a price on each metric ton of CO

314
00:17:13,440 --> 00:17:16,960
Speaker 11: two that's emitted into the atmosphere, and it's really like

315
00:17:17,040 --> 00:17:21,520
Speaker 11: the workhorse of Europe's climate ambition. Last month we saw

316
00:17:21,640 --> 00:17:24,399
Speaker 11: like enormous calls from a number of different countries and

317
00:17:24,480 --> 00:17:29,680
Speaker 11: leaders to make changes to calm volatility somewhere, even saying

318
00:17:29,720 --> 00:17:33,359
Speaker 11: that this should be scrapped or temporarily suspended in the

319
00:17:33,400 --> 00:17:36,040
Speaker 11: short term. We've kind of walked that back a little bit,

320
00:17:36,080 --> 00:17:38,239
Speaker 11: but indeed there's a review that has to come up

321
00:17:38,280 --> 00:17:42,480
Speaker 11: by July. We also heard that Commission President Earslo Vonderlion

322
00:17:42,600 --> 00:17:45,720
Speaker 11: last night said that she would provide some short term

323
00:17:45,760 --> 00:17:48,520
Speaker 11: relief in the market. The Block will come up with

324
00:17:49,040 --> 00:17:54,480
Speaker 11: around thirty billion euros using ETS emissions allowances to help

325
00:17:55,000 --> 00:17:58,080
Speaker 11: sort of the poorer countries within the EU help them

326
00:17:58,119 --> 00:18:01,359
Speaker 11: to decarbonize, and then we'll also see some quite technical

327
00:18:01,480 --> 00:18:05,119
Speaker 11: changes to what's called the Market Stability Reserve, which basically

328
00:18:05,240 --> 00:18:07,639
Speaker 11: is a separate pool of permits that could be brought

329
00:18:07,640 --> 00:18:10,960
Speaker 11: into the main market in order to calm prices. And

330
00:18:11,000 --> 00:18:14,880
Speaker 11: also something known as benchmarking, which kind of determines how

331
00:18:14,960 --> 00:18:18,880
Speaker 11: many free emissions allowances industry gets. So those are all

332
00:18:18,880 --> 00:18:22,359
Speaker 11: designed to kind of calm the volatility that's in the market.

333
00:18:23,240 --> 00:18:26,719
Speaker 3: But is this a setback for the ease climate ambitions

334
00:18:26,760 --> 00:18:30,040
Speaker 3: and other spike spike and energy prices. Has a lot

335
00:18:30,040 --> 00:18:32,359
Speaker 3: of questions being asked about some of those policies.

336
00:18:32,880 --> 00:18:35,960
Speaker 11: If you had asked me this time last month, I

337
00:18:36,000 --> 00:18:39,280
Speaker 11: would have said that Europe's climate ambitions were very much

338
00:18:39,440 --> 00:18:42,640
Speaker 11: under threat. We kind of saw a number of leaders

339
00:18:42,720 --> 00:18:45,960
Speaker 11: really taking aim at the ETS, saying that this was

340
00:18:46,000 --> 00:18:49,360
Speaker 11: an instrument that's adding a lot of costs onto consumers'

341
00:18:49,400 --> 00:18:53,640
Speaker 11: power bills after the era the war in Iran. However,

342
00:18:54,400 --> 00:18:58,080
Speaker 11: the last night we didn't hear that much opposition.

343
00:18:57,600 --> 00:18:59,800
Speaker 4: Actually to the ETS.

344
00:19:00,119 --> 00:19:03,560
Speaker 11: Well, of course, people saying that volatility needs to be calmed,

345
00:19:03,600 --> 00:19:05,760
Speaker 11: we can't let prices get out of hand, But I

346
00:19:05,800 --> 00:19:08,399
Speaker 11: think there is also now some acknowledgement that this is

347
00:19:08,440 --> 00:19:11,639
Speaker 11: a key tool not only to decarbonize, but also to

348
00:19:11,720 --> 00:19:14,440
Speaker 11: provide countries with the revenues that they need in order

349
00:19:14,520 --> 00:19:15,879
Speaker 11: to help out consumers.

350
00:19:16,720 --> 00:19:19,480
Speaker 3: This is Bloomberg Daybreak Europe, your morning brief on the

351
00:19:19,520 --> 00:19:22,600
Speaker 3: stories making news from London to Wall Street and beyond.

352
00:19:22,920 --> 00:19:26,880
Speaker 2: Look for us on your podcast feed every morning, on Apple, Spotify,

353
00:19:27,000 --> 00:19:29,040
Speaker 2: and anywhere else you get your podcasts.

354
00:19:29,080 --> 00:19:32,119
Speaker 3: You can also listen live each morning on London Dab Radio,

355
00:19:32,160 --> 00:19:34,679
Speaker 3: the Bloomberg Business app, and Bloomberg dot Com.

356
00:19:34,920 --> 00:19:37,680
Speaker 2: Our flagship New York station is also available on your

357
00:19:37,720 --> 00:19:42,439
Speaker 2: Amazon Alexa devices. Just say Alexa play Bloomberg eleven thirty.

358
00:19:42,680 --> 00:19:44,080
Speaker 2: I'm Caroline Hepka.

359
00:19:43,800 --> 00:19:44,720
Speaker 4: And I'm Stephen Carroll.

360
00:19:44,760 --> 00:19:47,119
Speaker 3: Join us again tomorrow morning for all the news you

361
00:19:47,200 --> 00:19:49,880
Speaker 3: need to start your day right here on Bloomberg day

362
00:19:49,880 --> 00:19:54,280
Speaker 3: Break Europe