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Pentagon: US war on Iran has cost US $29 billion to date
A senior Pentagon official stated on Tuesday that the United States war in Iran has cost $29 billion so far, which is an increase of $4 million from an estimate given late last month. The Democrats have been able to gain a lot of ground in the public opinion polls, as they try to tie the war to cost of living issues. The Pentagon announced on April 29 that the war had already cost $25 billion. Jules Hurst who performs the duties of comptroller told lawmakers that the new costs included updated repair and replacing equipment?and operational expenses. Hurst stated that "the joint staff team as well as the comptroller's team are always looking at this estimate." He spoke alongside General Dan Caine, Chairman of the Joint Chiefs of Staff and?Defense Secretary Pete Hegseth. The 'Pentagon has not explained how it arrived at this $29 billion number. In 'March, a source said that Trump's Administration estimated the?first six days?of war costing at least $11.3billion. Reporting by Idrees Al, Phil Stewart, and Doina chiacu. Editing by David Ljunggren.
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New Zealand changes law to prevent private climate litigation
New Zealand's Government announced?on?Tuesday that it would amend climate legislation so that courts cannot hold companies responsible for harms caused by greenhouse gases in climate-related cases. Justice Minister Paul Goldsmith announced that the government will amend the Climate Change Response Act of 2002 so it applies to current and future court cases, including a High Court lawsuit brought against six major polluters. The governments of the world are dealing with an 'upsurge in litigation' aimed at holding corporations liable for damage caused by emissions. Cases in Europe, the United States, and Australia test the limits to corporate responsibility. Next year, the New Zealand case brought by climate activist Michael 'Smith against six companies, including Fonterra Co-Operative Group and dairy giant Fonterra, will be tried. The novel case alleges that the emissions of these companies have contributed to climate changes and have harmed Smith’s land, cultural rights and interests. The government says climate litigation undermines business Goldsmith, however, said that the litigation undermined business confidence and investments, and that New Zealand’s response to climate changes should be managed by parliament, its Emissions Trading Scheme, and existing climate legislation. Goldsmith stated that the courts were not the best place to settle claims of climate change harm, and that tort law wasn't suited for the complex issues involved in environmental, economic, and social matters. The government stated that the change "would not affect" its responsibilities under climate law or the obligations of businesses under the ETS. ClientEarth, an international campaign group that has sued companies and countries over their contributions to global warming said this move was "deeply worrying" and pointed to a U.N. ruling issued in July on the obligations of countries: The International Court of Justice affirmed that states have a legal duty to address climate harm. People must be able to test these obligations in court. Restriction of access to courts is bad not only for democracy, but also for justice and rule of law. Reporting by Lucy Craymer, Editing by Lincoln Feast & Kevin Liffey
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US consumer prices continue to rise in April
Consumer prices in the United States?rose rapidly for a second consecutive month in April. This resulted in?the largest annual increase in inflation for nearly three years, and further reinforced expectations that the Federal Reserve will keep interest rates at their current level for some time. The Bureau of Labor Statistics of the Labor Department reported on Tuesday that the Consumer Price Index rose 0.6% in April after a 0.9% increase in March. The economists polled had predicted the CPI to rise 0.6%. Estimates varied from a gain of?0.4% to 0.9%. Moderation was largely mechanical after the biggest increase since June 20,22. After the U.S. and Israel launched strikes against Iran in March, oil prices soared?above $100 per barrel. They then fell to high levels again after an early April ceasefire. CPI rose 3.8% in the year to April. This was the largest year-on-year rise since May 2023, and it followed a 3.3% increase in March. Back-to-back high inflation rates will increase political risks for Donald Trump and the Republican Party ahead of November's midterm election. Trump won re-election 2024 largely because he promised to reduce inflation. However, Americans are now less enthused about his economic management and blame him for the high prices at the pumps. Oil prices have risen due to the war, and this has been reflected immediately in higher gasoline, jet fuel, and diesel. Economists expect the second round of effects to be felt over the next few months. The report followed news ?last week of a bigger-than-anticipated increase in nonfarm payrolls in April. The financial markets anticipate that the U.S. Central bank will keep rates unchanged until 2027. Last month, the Fed, which uses the Personal Consumption Spending?price indices to meet its 2% target for inflation, left its benchmark interest rate between?3.50% and 3.75%. The CPI, excluding food and energy, rose 0.4% in November. This was partly due to a temporary adjustment of rent measures, after the shutdown of the federal gov't last October prevented data collection. The BLS divides its rental survey into six panels. The BLS samples each panel?every 6 months, on a rotating schedule. The BLS used carry-forward imputation to make up for missing data, which artificially reduced the rent indexes. The so-called core CPI rose 0.2% in March. Most economists think that the tariffs of Trump are likely to have been passed through. In February, the U.S. Supreme Court ruled that the tariffs were invalid and lowered the effective rate. In April, the core CPI inflation rate increased 2.8% compared to March. Lucia Mutikani, Andrea Ricci, and Chizu Nomiyama edited the report.
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Oil prices continue to rise, and the Iranian ceasefire is 'on life-support'
The dollar rose on Tuesday as the hopes of a deal that would allow ships to pass through the Strait of Hormuz faded. Meanwhile, a hot rally in "chip" stocks cooled down and traders waited for U.S. inflation data. The U.S. president Donald Trump said that the ceasefire agreement with Iran, which had been in place for a month, was "on life-support" after Tehran's reaction to the U.S. plan of ending the war showed how far apart the two sides were. Brent crude futures rose almost 4%, to $108 per barrel. The STOXX 600 in Europe was down by 0.6%. It is only 4% lower than the record high of late February. Meanwhile, U.S. stocks futures for S&P 500, and Nasdaq, were down by 0.4%, and 0.9% respectively. Focus on TRUMP's trip to China Even the seemingly unstoppable KOSPI in Seoul has slowed down. It dropped 3.5% as it approached 8,000 and pulled other regional markets down. Jim Reid, a strategist at Deutsche Bank, said that with the U.S.-Iran appearing to be no closer to "resolving" their deadlock in negotiations, Brent crude prices continued on yesterday's upward trend. He said that the markets are pricing in the possibility of a lasting disruption. Yesterday, 6-month Brent futures rose 2.54% to $89.50 per barrel. The markets are watching Trump's trip to China which starts on Wednesday. They do not expect any progress in the?Iran issue or on trade. Investors shouldn't expect to see sweeping deals. "A 'win' means no new export controls or tariffs, but perhaps small symbolic deals such as agricultural purchases or aircraft orders or signals on rare Earths," said Daniel Casali. Chief investment strategist at Evelyn Partners. These may seem minor, yet stability on the margins is important. APRIL INFLATION PIKE IS EXPECTED BY U.S. DATA The U.S. will release its inflation data on Tuesday. The headline consumer price index is expected to show a 3.7% increase year-over-year, following a rise of 3.3% a month ago. Markets could be rattled by any suggestion that the Federal Reserve may have to raise rates this year, rather than reduce them as investors expected before World War II. Global bond yields are rising, mainly due to a sell-off of gilts, in response to mounting pressure on Prime Minister Keir starmer who, on Tuesday, refused to resign. He said he would "get to work" on governing despite the growing calls for him to resign after a series of heavy local election losses. On Tuesday, UK gilt yields soared sharply. According to LSEG, the yield on 30-year bond reached 5.794%. This is its highest level since 1998. The sterling fell 0.5% to $1.354, which makes it the worst performing major currency against the dollar. Benchmark 10-year Treasury Yields are up by 2 basis points at 4.43%. The dollar is on top of the currency market. It has gained 0.2% against the Japanese yen, reaching 157.525. Scott Bessent, U.S. Treasury 'Secretary, said that after meeting with Japanese Finance Minister Satsuki katayama in Tokyo he was confident about the coordination between Japan and the U.S. Treasury in tackling excessively volatile, undesirable currency movements. The Australian dollar dropped 0.34% and the euro fell 0.31%. The Australian budget contained the largest changes in investment taxes since the turn of the century, to assist young people to enter the housing market. (Additional reporting from Jihoon in Seoul, edited by John Mair and Christian Schmollinger)
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Dollar and oil rise as gold falls amid fading Middle East Peace Hopes
The dollar and oil prices rose on Tuesday as a result of the slim hope of a 'U.S.-Iran 'peace deal. This clouded the outlook for U.S. rate hikes ahead of important inflation data. After reaching its highest level since April 21, spot gold dropped 0.8% by 1117 GMT to $4,696.07 an ounce. U.S. Gold Futures for June Delivery lost 0.5% to $4,703.20. Donald Trump, the U.S. president, said that a ceasefire agreement with Iran is "on life support". This was after Tehran refused to accept a U.S. plan to end the conflict. It also refused to budge from a list demands he called "garbage". Ole Hansen is the head of commodity strategy for Saxo Bank. He said that rising energy prices are once again driving up U.S. bonds yields in advance of today's CPI print (consumer price index). Oil prices rose as the Strait of Hormuz, a key shipping route, remained largely closed. The Federal Reserve may be able to get a clue from the April inflation figures, which are expected later today. Increased crude oil prices may increase the risk of interest rate increases. Gold is often seen as a hedge to inflation but high rates can weigh down on this non-yielding investment. Benchmark 10-year U.S. Treasury Yields reached a one week high. The dollar also gained 0.4% making dollar-denominated goods?more costly for holders of currencies other than the US dollar. According to CME Group’s FedWatch? tool, traders have priced in a 'Fed rate reduction? this year. Markets now see a 36% probability of a hike before March 2027. The markets are also watching Trump’s two-day visit to China from Wednesday. During this time, he will meet Chinese President Xi Jinping. Middle East is expected to play a major role in the agenda. Hansen said that gold prices are still rangebound. "Overall, the price of gold is a bit volatile. Support has been established at $4,500 and resistance is near the 50-day moving median, or $4,757." Silver fell by 3%, to $83.50 an ounce. Platinum dropped 2.7%, to $2,077.44. Palladium fell 1.9%, to $1,479.91. (Reporting and editing by Harikrishnan Nair, Kevin Liffey, and Noel John from Bengaluru)
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Timothy Go, CEO of HF Sinclair, leaves the company after a leave of absence
U.S. refiner HF Sinclair announced on Tuesday that former 'CEO Timothy Go' departed the firm effective May 11, under a?? mutually agreed??? separation??? agreement after being on voluntary?? leave for almost three months. Go, the former chief executive of the company, was on leave from February 17 to March 1 as part of a review after Atanas Atanasov, the finance chief, raised concerns over Go's actions affecting the tone at the top regarding the 2025 disclosure process. Since then, Board Chair Franklin Myers has served as interim CEO and President. During the review, the board raised a number of concerns regarding the CFO Atanasov’s behavior and questioned his ability to maintain a working relationship with the management. Atanasov is on leave from February 24. Negotiations over a possible separation agreement are still ongoing and have not yet resulted in a settlement, according to the company. HF Sinclair confirmed that Go's departure was not due to any disagreements with the?company over?its policies, practices or operations. Go will also receive $4.7 million in severance over a period of 12 months, as well as continued health benefits if he elects to do so under federal law. HF Sinclair stated that there is no guarantee of an agreement. Pooja Menon, Bengaluru (Reporting; Leroy Leo, Editing)
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FOREX Dollars are rising but not by much, as data is awaited.
The U.S. Dollar extended gains for the second consecutive?session? on Tuesday. This was largely due to the sustained uncertainty surrounding the Middle East conflict, which drove investors towards the greenback in search of a?traditional safe haven?. In March, the greenback rose sharply as oil prices soared after Iran closed the Strait of Hormuz. The dollar weakened after the ceasefire began on April 7. Donald Trump, who dismissed Iran's proposal Monday as "garbage," threatened to terminate it. The U.S. Dollar Index, which measures its value in relation to a basket major foreign currencies, rose 0.36%, reaching 98.30. The index was at 97.85 in February and reached?100.64 by late March. Late last week, it fell below pre-war levels. Mohit Kumar is an economist with Jefferies. He said: "It seems unlikely that a major breakthrough will be made before the Trump-Xi Summit later this week." Trump is expected in Beijing to meet with Chinese President Xi Jinping on Wednesday. Topics to be discussed include Iran. CRUDE OIL SUPPORTING DOLLAR "As long the crude oil price stays high, due to the U.S. blockade of [Iranian ports] and Iran’s threat against tanker traffic in Gulf, the dollar will remain strong," said Thierry Witzman, global Forex and Rates Strategist at Macquarie Group. He added that "the toll high oil prices will take on other countries' economies is much greater than the toll taken by the U.S." The price of oil rose by 3% on Monday as the hopes for an agreement to end the Iran war faded. Wizman also claimed that the U.S. government has likely decided that their economic blockade against Iran -- or the 'economic warfare' -- would be more effective than restarting bombing campaigns. RATE OUTLOOK IN FOCUS Investors also pay close attention to the monetary outlook. The Federal Reserve is expected to maintain higher rates for longer. Meanwhile, traders bet that the European Central Bank (ECB) will increase its depo to around 2.75% from the current rate of 2% by the end of the year. The euro dropped 0.33% to $1.1744. A survey of economists predicts that the U.S. consumer price index will show a 0.6% increase in April after a 0.9% jump in March. The estimates?ranged between a 0.4% gain and a 0.9% increase. John Velis of BNY, who is the head of Americas Strategy, said that the case for a rate cut this year was becoming increasingly difficult. He added that "the last two weeks of U.S. data show a economy which is not feeling the acute pressures caused by the Iran conflict." YEN IS STILL IN THE INTERVENTION WATCH ARENA The Japanese yen surged suddenly during the late Asian session of Tuesday, fueling speculation about a currency intervention. The dollar last traded at 157.57 yens, up 0.2% on the day. This was after U.S. Treasury Sec. Scott Bessent stated that he has great confidence in Bank of Japan Governor Kazuo Ueda to guide the central banks towards a "very effective" monetary policy. Japan's authorities are said to have spent $63.7 billion on the current round.
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China's ethane imports from the US hit a record high as Iran war reduces rival feedstock supplies
According to traders, analysts, and shipping data, China increased U.S. Ethane imports in April, capitalising on the strong petrochemical margins, as other Middle East?feedstocks were disrupted by the Iran War. The U.S. and Israel war against Iran halted the majority of shipments of liquefied gas (LPG) from the Middle East via the Strait of Hormuz. This forced Chinese petrochemical manufacturers to look to the United States to get more supplies. This was despite the fact that trade tensions last year caused Beijing to temporarily impose a tariff of 125% on U.S. exports. Data from Sublime China Information and?Kpler showed that China imported the highest amount of ethane ever in April. This was mainly due to purchases made by Satellite Chemical, Wanhua Chemical, and SP Chemical. The companies did not immediately respond to requests for comment. Kpler data showed that China's ethane exports to the U.S. have reached 3.462 millions tons, which is more than half the volume of 2025. Kpler data shows that China's imports of naphtha, LPG and other petrochemicals almost halved in April to 1.834 millions tons. Ethane, LPG and naphtha are the building blocks of petrochemicals that are used to manufacture plastics, paints, and pharmaceuticals. HIGH MARGINS FOR ETHANE CRACKS According to the pricing agency Argus, the ethylene gross spot-cash margin for ethane based crackers was $845 per ton in Northeast Asia on April 3. This is the highest level since June 2018. Manish Sejwal is senior vice president of Rystad Energy's commodity markets, oil. He said that competing crackers in China and other parts of the region were operating at lower rates or shut down due to the?tight availability of feedstock from the Middle East. According to Chinese consultants JLC and Energy Aspects, China's crackers that use ethane operated at nearly full capacity in April. A source from a cracker operator in Shanghai said that unlike other feedstocks, the ethane is readily available because it's sourced?from America. The source refused to give his name as he wasn't authorised to talk to the media. The United States is the largest producer and exporter in the world of ethane. This is a by-product of natural gas. Data from the Energy Information Administration shows that China is responsible for almost half of all U.S. imports. SCI data as of May 9 showed that imports in May are expected to drop to 414,000 tons - 41% less than April - as the domestic demand is weakening. Toong Shien Lee said that the ethylene demand in May has weakened due to buyers of ethylene based products being concerned about shrinking margins.
Zelenskiy's comments cast doubt on the claim that the Ukraine war was nearly over, as stated by Putin
The Kremlin reiterated Vladimir Putin's claim?that war in Ukraine is almost over? on Tuesday after the Ukrainian President Volodymyr Zelenskiy stated that?Moscow has no intention of?ending? it.
Putin, who has been in power for five years, told reporters that the war was nearing its end.
Dmitry Peskov, Kremlin spokesperson, said that a trilateral effort with Ukraine and the United States was made to find a peace agreement.
Peskov told reporters that "this accumulated groundwork?in terms of the peace process allows to us to say the completion is in fact approaching", though he said that at this time it was hard to give specific details.
?Zelenskiy stated on Monday: "Russia does not intend to end this war. We are, unfortunately, preparing new attacks.
U.S. President Donald Trump has held multiple rounds of negotiations with warring parties to try and end the conflict. However, no peace agreement has been reached. Russia, which occupies about a fifth (or more) of Ukraine, is demanding that Kyiv cede further territory. Kyiv wants Russian forces to leave.
Peskov stated that Russia would welcome additional U.S. mediator efforts, and Putin was ready to meet Zelenskiy personally once the peace process is finalised.
"And for that finalisation, to put an end to it, there is still a lot of work to do," he added, adding that the war could be over as soon as Kyiv or Zelenskiy take the "necessary decision".
The two sides agreed to a brief ceasefire, mediated by the United States, from 9-11 May, which coincided with the anniversary the Soviet victory against the Nazis during World War Two.
Both sides claimed that fighting continued on the front lines despite the ceasefire. They also accused each other's drones and artillery of attacks. Reporting by Dmitry Antonov, Writing by Maxim Rodionov, Alessandra Prrentice and Guy Faulconbridge Editing by Peter Graff
(source: Reuters)