Oil falls under $90 as Trump suggests Iran struggle might be over quickly | USAEMALL.com

Good morning and welcome back to FirstFT Asia. In today’s newsletter:

• A wild day of trading

• Taiwan’s baseball diplomacy angers Beijing

• China’s fight to eradicate poverty

• The economies hardest hit by the Iran war

We begin with oil market turbulence, as yesterday’s gains in crude prices evaporated in New York afternoon trading after Donald Trump suggested the war against Iran could be over soon. Here’s what you need to know.

What happened: The US president told CBS in an interview that the war was “very complete, pretty much” as he declared there was “nothing left in a military sense” in Iran. “They have no navy, no communications, they’ve got no air force. Their missiles are down to a scatter. Their drones are being blown up all over the place, including their manufacturing of drones.” Addressing Republican lawmakers later in the afternoon, he described the war as a “little excursion” that would last for the “short term”.

Oil gains wiped out: Trump’s comments, which followed a surge in oil prices that has threatened to damage the global economy, prompted a sell-off in energy markets. Brent crude, the international benchmark, traded below $90 a barrel in afternoon trading in New York, having exceeded $119 during the Asia session. A decision by G7 countries to stand “ready” to release emergency reserves also helped to tame some of the volatility that sent prices soaring.

More developments: Pakistan has launched a naval operation near Iran to counter “threats to national shipping and maritime trade”, its military announced yesterday. The move signals that Pakistan, a nuclear-armed country with close military ties to the Gulf, is finding itself dragged into the war on its doorstep. Follow the latest news in our live blog.

• The rise of Mojtaba Khamenei: Iran’s new supreme leader has been shaped by life-long ties with the powerful and hardline Revolutionary Guards.

• Iran’s oil lifeline: Iran’s Kharg Island has so far been left untouched by US-Israeli bombing. How the Trump administration deals with this crucial export hub could shed light on its longer-term strategy towards Tehran.

• Monetary policy: Investors are betting that central bankers could be forced to raise interest rates in response to the Iran war.

Here’s what else we’re keeping tabs on today:

• Economic data: Japan and South Korea publish fourth-quarter GDP estimates. China reports trade data for January and February.

• Results: Saudi Aramco, Oracle and Jardine Matheson report earnings.

Sign up to an exclusive subscriber webinar about the Middle East war. On Wednesday March 11, a panel consisting of FT columnists Kim Ghattas, Edward Luce, Katie Martin and Gideon Rachman will join chair Alec Russell, the FT’s foreign editor, to dissect the political, military and diplomatic calculations behind the conflict. Register here.

Five more top stories

1. China has accused Taiwan’s premier Cho Jung-tai of “evil motives” after he was spotted over the weekend in the Tokyo Dome supporting his national team in an international baseball tournament in Japan. The incident has further inflamed a months-long diplomatic row between Tokyo and Beijing over Taiwan.

2. Chinese consumer prices bounced back in February, rising at their fastest pace in more than three years due to Lunar New Year celebrations and surging oil prices. Deep deflationary pressures in industry also showed signs of easing as AI-related spending increased and Beijing clamps down on overcapacity.

3. Anthropic has sued the Pentagon and other federal agencies over its designation as a “supply chain risk”, after the AI start-up insisted the US military accept curbs on the use of its technology. In a court filing yesterday, the company accused the Trump administration of “seeking to destroy” its economic value with the designation, which is usually reserved for Chinese and Russian vendors.

4. Germany’s industrial giants are pushing for a Japanese-style trading house to secure supplies of critical raw materials in a bid to bypass China’s stranglehold on rare earths. Carmaker BMW and arms maker Rheinmetall are part of the initiative to emulate Japan in making joint purchases of critical minerals on behalf of industry.

5. The US government has reached a deal with Halkbank to end a years-long prosecution accusing the Turkish bank of helping Iran evade sanctions and launder billions of dollars through the American financial system. The case, first filed by federal prosecutors in 2019, had long been a thorn in bilateral relations.

The Big Read

China has lifted more than 700mn people out of indigence, but some doubt President Xi Jinping’s claim that the mission is complete. Has China ended poverty? William Langley in Guizhou investigates.

We’re also reading . . . 

• Iranian regime: The appointment of Mojtaba Khamenei as supreme leader shows Trump’s Venezuelan playbook has failed in Iran, writes Gideon Rachman.

• ‘South Korea’s Amazon’: Is the country’s dominant online retailer an American company? Coupang is leaning on its US domicile to lobby Washington against probes from Seoul.

• China’s growth target is a global problem: Beijing’s export offensive could be more destabilising than Trump’s tariffs, writes Ruchir Sharma.

Chart of the day

Trump’s attack on Iran will hit European and Asian economies harder than the US, which will be cushioned from some of the effects by its large domestic energy sector, analysts say. 

Take a break from the news . . . 

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