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The rising gas prices due to the Iran war threaten Trump's Republican majority.
In the minutes following?Donald Trump?s State of the Union Address, in which he argued why voters should vote to keep Republicans in control in the November midterm elections?the president boasted about how falling gasoline prices have solved the "disasters" left by his predecessor. Gas prices are up by almost?60 cents per gallon two weeks after the airstrikes against Iran that were launched on February 28th. This sparked a regional conflict which has spread far beyond Iran's border. Trump's and his Republican colleagues' political headaches are quickly becoming a pain at the gas pump. Their narrow majority in the Congress looks more fragile as the midterm elections approach. Crude oil prices were down on Tuesday after Monday's dramatic rise. It remains to be determined where gasoline prices are headed in the nine months before the November 3 elections. Even before the Iran War, U.S. citizens were angry at the high cost-of-living and frustrated by Trump's lack of action to reduce it. /Ipsos surveys show. Jacob Perry, Republican strategist, said: "You cannot hide gas prices." "You can make up all these other things and say that everything is fake. There's a huge sign at every corner that says how bad the situation is. Every commute to work is a reminder." Focus on Affordability in Campaign Democrats have pledged to place affordability at the forefront of their campaigns. To win a majority in the House of Representatives, Democrats need to flip just three Republican seats. However, they have a more difficult path to take in the Senate. Hakeem Jeffreys, the House Democratic Leader on X, said that Trump promised an American Golden Age. "While Republicans are wrecking the economy, gas costs are out of hand, and extremists spend billions on dropping bombs in Middle East," said Hakeem Jeffries, House Democratic leader. House Republicans who are in Florida this week for a policy retreat, where they are discussing their legislative agendas, acknowledge that rising gas prices are an issue that voters are concerned about. However, they cite Trump's claim that the rise will be temporary and say that the administration's plans to increase domestic production of energy would 'lessen the pain'. Austin Scott of Georgia, a Georgian Representative, said: "Everyday that people pay for fuel at the gas stations, we know how much it hurts. "We will do everything we can to correct it." "They understand that it is a temporary issue." TRUMP'S CAMPAIGN IS ABOUT LOWERING PRICES According to AAA, the average national gas price on Tuesday was $3.54 per gallon. This is up 19% from when the war started. Trump's plans to examine several options to curb oil prices are a sign that the White House is concerned. This includes releasing crude oil from strategic reserve, limiting U.S. imports, and waiving certain federal taxes. Trump announced on Monday night that the U.S. will waive some oil-related sanctions. He did not provide any details. The White House announced that Trump will discuss the economy on his Wednesday trip to Ohio and Kentucky. Gas prices could be particularly harmful for a President who won the White House largely because he promised to curb inflation, lower energy rates and reduce the cost of living. Rep. Warren Davidson (a Republican from Ohio) said that the increase in gas prices was a concern for the midterm elections. He said, "The economy will always be a major issue on the ballot." "The president has done a lot of great things for the economy, and we'll have to see what happens." "IF THEY RISE THEY WILL RISE" Trump's response to the rising prices is unlikely to calm Americans' fears. In a recent interview, Trump stated that he was not concerned about the rising gas prices. He predicted they will drop when the Iran conflict is over. He repeated his claim on social media at the weekend. "Short-term oil prices" are a "very little price to pay" in order to ensure global security. Trump's changing rationales regarding the Iran war have made it harder for him to argue the disruption of the?U.S. The disruption to the?U.S. economy has been deemed not worth it. The administration has not provided evidence that Iran posed an immediate danger, and Trump had himself insisted last year that U.S. attacks "obliterated'?the country’s nuclear weapons program. John Feehery is a Republican strategist who said, "I do not think people are that concerned about Iran." "I believe they are concerned about the price of their gasoline. "I think they care about their gas prices." "This better be quick, is all I can add," he said of the war. (Reporting and editing by Scott Malone, Alistair Bell and Scott Malone; Additional reporting and editing by Nicole Jao and David Morgan)
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Nigeria prioritizes local gasoline supply and suspends import licenses
Nigeria has suspended the issuance?of gasoline import 'licences' for the second consecutive month, as regulators?begin enforcing the provisions of the Petroleum Industry Act PIA that only allows?imports if the African countrys domestic supply is?insufficient. The Crude Oil Refineries Association of Nigeria has confirmed that no import licences have been issued yet in March. This indicates a shift in the focus to local production. This'shift' highlights the stronger intention of the Nigerian authorities to safeguard domestic refining. It is also a victory for the Dangote Refinery which sued last year the regulator and state oil company to stop imports. The PIA allows imports only when domestic production is insufficient to meet the national demand. The previous'regulator', who resigned last year, claimed that issuing licenses was essential to maintain competition and avoid market dominance. Fuel prices are up more than 54% in the last week since Israel and the U.S. began their strikes against Iran. This has pushed global oil markets to higher levels. NMDPRA spokesperson George Ene Ita blamed the sharp increase in?prices to the escalating conflict between Israel and the United States in the Middle East. Nigeria's average daily gasoline consumption dropped to 56.9 millions litres from 60.2million litres a day in January 2026. The 'Dangote Refinery' supplied the local market with?36.5 millions litres (about 8 million litres) of petrol in February. The regulator decided that 'these volumes are sufficient and withheld the import licences. Eche Idoko is the spokesperson for the Crude Oil Refiners Association of Nigeria. CORAN has been urging the government to stop granting import licences which are reducing the margins of local refiners. "We support any measure that helps protect local production." Idoko stated that the challenge is now to maintain momentum. (Reporting and editing by Alexander Smith; Isaac Anyaogu)
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New York is against reopening Indian Point Nuclear Power Plant despite Trump's push
Kathy Hochul, the New York governor, opposes Trump's campaign to restart an nuclear power plant just north of New York City, her office said this week. Days after?the?U.S. The energy secretary visited to encourage the plant's reopening. The U.S. is experiencing a surge in power demand for the first decade, thanks to the explosion of AI data centers. To meet this demand, President Donald Trump set the goal that the U.S. quadruple its nuclear power capacity by the year 2050. Ken Lovett is Hochul's senior communications advisor on Energy and Environment. She said that the governor had made it clear she would not support a reopening of Indian Point. Instead, she wants to see a major expansion of advanced nuclear energy in communities upstate New York who want?it. Indian Point's restart would be unlikely without the support of Hochul, a Democrat. Chris Wright, the U.S. Energy secretary, held a press conference at Indian Point on?Friday to promote nuclear energy and renewed operations at this plant. Holtec, owner of the site, is decommissioning the power plant after its closure in 2021. After the attacks of September 11, 2001, opposition to Indian Point as a possible target for attack increased. Holtec wants to enter the business of operating reactors. Holtec has been providing services in the nuclear sector for many years, including the shutdown of plants. It is currently attempting to restart an abandoned Michigan nuclear power station. Constellation, NextEra and Microsoft have contracts with Google and Microsoft to restart operations at the former Three Mile Island Nuclear Power Plant in Pennsylvania as well as a plant located in Iowa. Wright stated in a press release that the Trump Administration believed energy policy should be centered on the American people, not politics. This would include expanding American energy sources, creating more American job opportunities, and lowering the electricity prices of every American household and business. Holtec CEO Kris Singh was at the event last week and applauded Holtec's idea to restart the plant. However, the company said that it would take the buy-in of multiple government and political agencies. We would work to achieve this goal if the state had the political will to do so and the financial resources to do so. We will continue to decommission IPEC safely if the political will and financial means are available, a company spokesperson said. Nuclear Regulatory Commission chair Ho Nieh?told journalists on Tuesday at a press conference: "If a decision is taken by the owners to restart this unit, they will be coming to the NRC to talk about the steps needed to'restart the Indian Point Plant. Hochul wants to build 5 gigawatts of new nuclear power in New York. She has directed the New York Power Authority so far to develop and build one gigawatt new capacity upstate New York. This is further away from New York City then Indian Point.
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Polish utility Enea reports smaller fourth-quarter losses
Enea, the Polish utility, expects to report a net loss of 840 million Zlotys ($230m) in its fourth quarter. This compares with a loss of 1.86 billion Zlotys last year. According to the company, this was due to the higher margins of licensed activities. * The fourth-quarter revenue was 7.45 billion zlotys while EBITDA was 983 millions zlotys * The distribution network and gains in winter heating have helped cushion the bottom line against late-year provisions linked to lower'state-regulated' electricity prices for households Enea reported in February that its net profit for 2025 would be hit by 1.37 billion zlotys due to impairment charges, and increased provisions for onerous contract. ** It booked a provision of 139.9 millions for the fourth quarter in 2025, in response to a request from a 'Polish energy sector watchdog Enea struggles with falling profitability as Poland switches to renewables. This has pushed coal’s share in the 'electricity mix' to record lows.
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Chile's Kast, elected in an economic boom, takes office amid global turmoil
Local markets rallied in December after Chile's far-right president,?Jose Antonio Kast, was elected on promises of economic expansion, deregulation, and cuts to public spending. But the economic tailwinds are now turbulent, as the iran war has sent the global markets into a tailspin. Kast is now responsible for managing the turmoil. A spokesperson from Kast's economic team stated that there were no contingencies planned for the moment, but didn't provide any further details on how recent events would affect their economic agenda. Kenneth Bunker is a political expert and academic from the University of San Sebastian. He said that Kast was elected because he promised to be an "emergency" government that would fix issues that were important to Chileans. Bunker stated that Kast's priorities would likely remain the same, but the ability to implement them will be affected by factors such as the exchange rate and inflation, along with economic growth. Bunker also said if the government doesn't get the expected growth, some of its plans may be delayed. Chile is the second largest lithium producer in the world and also has one of the highest copper production rates. Its economy is highly sensitive to changes on international markets. Copper, Chile's primary export and its main source of income, has risen from less than $10,000 a ton in June last year to $13,618 a ton at the end January. According to the departing government, every percent increase is worth an extra $27 to $35 million to the Chilean Treasury. Chile was expected to receive up to $4 billion more in revenue due to the rising prices of red metal. However, the price has fluctuated in recent weeks and dropped?upto 8% off recent highs. The price of the red metal has increased to $13,098 as of Tuesday. Due to the lack of production in Chile, the country is one of the biggest oil importers of Latin America. This has increased the impact of oil prices that have risen by nearly $120 per barrel since the beginning of the war. Oxford Economics, in a survey of emerging markets released on Monday, said that the Iran war had increased inflation risks significantly. In its oil shock simulation the report showed that Q2 inflation was expected to rise between 0.4ppts and 1.7ppts. Marcela Vera is an economist from the University of Santiago. She said that Chile is extremely sensitive to external shocks. The economy is very open to free trade and has many agreements for financial protection. Its model is built on an export-oriented system. Chile's IPSA stock index continued to rise after the election, and peaked at about a 65% increase from a year ago. The Chilean peso has been on a steady rise since July, and in early February, it reached its highest level in many years. Since those recent highs the stock market is down over 10%, and the currency has fallen about 5%. This is due to the rising oil prices and global uncertainty that has rocked the nation. Vera pointed out that Chile's MEPCO fund operates in three-week cycles and helps?smoothed out price spikes. Vera stated that if the war continued for several months, "we'd have a chronic impact on our economy." Vera said that the increase in oil prices would not be limited to the price of crude, but also the logistics costs and the value of the dollar. JPMorgan released a report on Friday that stated while MEPCO reduces the impact of rising oil prices, "it does not eliminate the pass-through effect" and increased its inflation forecast for December by 20 bp.
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Witkoff says that Russia has told Trump they are not sharing US military assets with Iran.
Steve Witkoff, U.S. Special Envoy to CNBC on Tuesday, said that Russia has denied sharing intelligence with Iran about U.S. military assets in the Middle East. Witkoff stated that the denial occurred during a telephone call between?U.S. Donald Trump spoke with?Vladimir Putin, the Russian president on Monday. The Washington Post reported Friday that Russia is providing Iran with information on targeting, including the locations of U.S. warships & aircraft in the Middle East. Witkoff responded that "yesterday, on the call with President Obama, the Russians stated that they had not been sharing" when asked by Washington if it believed Russia shared intelligence with Tehran about the location U.S. Military assets. We can trust their words. They?did say it. Jared (Kushner), I and Yuri Ushakov (Kremlin's foreign policy aide) spoke independently yesterday morning. They both confirmed the same thing," Witkoff said. He added: "That is a better question for the intel people, but let's just hope they aren't sharing."
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Israel's Foreign Minister says that Israel does not want to fight Iran indefinitely
Israel does not want a 'never-ending war' with Iran and will coordinate with the United States on the end of the conflict, said Foreign Minister Gideon Saar on Tuesday. He declined to give a public timeline on the end of the conflict. In its 11th day of combat, the U.S. and Israeli war against Iran has engulfed much of the Middle East. Iranian attacks have hit neighbouring countries, such as the United Arab Emirates. Israel is also fighting Hezbollah, in Lebanon, as well as Iran. Saar, along with his German counterpart, told journalists in Jerusalem that they would continue to work until we and our partners decide that it is time to stop. He said, "We don't want an endless war." Friedrich Merz, the German Chancellor, said in Berlin earlier that Europe was becoming more concerned about the war. It appeared there was no plan in place to end it. Saar responded to a government question about what victory looks like by saying, "We want the existential threats to be removed,?for the long term, from Iran to Israel." He called Mojtaba Khamanei, the newly appointed supreme commander of Iran - the son of Ayatollah Ali Khamenei, who was killed on the first war day by Israeli forces - an extremist. Israel has said that it wants to end Iran's clerical regime by destroying the country's nuclear and missile programs, and creating conditions to allow Iranians to topple their rulers. Saar said that there is an opportunity to create conditions to allow Iranians to "regain freedom," while acknowledging it may not occur during the war. We must not waste this opportunity by delivering partial results. German Foreign Minister Johann Wadephul is the first high-ranking official from outside the United States to visit Israel publicly since the start of the war. He said that he believed both Israel and Washington are open to a diplomatic resolution which could bring an end to the conflict. Wadephul stated that Tehran has made it clear that they are not prepared to accept any terms in a?solution?. (Reporting and Editing by Alexandra Hudson, Philippa Fletcher and Alexandra Hudson)
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Exxon to abandon New Jersey incorporation in favor of Texas homecoming
Exxon Mobil wants to abandon its corporate registrations in New Jersey and relocate in Texas, where its "headquarters" is located. This move could strengthen its defenses against climate activists and activist shareholders. Exxon made the announcement in a proxy file. If shareholders approve the move, Exxon will become the latest high-profile company to register in Texas, joining SpaceX, Tesla, and Coinbase. A new Texas law improved legal protections for business through several mechanisms. This included reducing shareholder litigation threats by allowing businesses to set stock ownership levels for lawsuits. The company stated in a filing that "the Board believes Texas legislators and judges who could make decisions affecting Exxon Mobil, are more familiar with the business and operations of the company." Exxon was at odds with activist investors in recent years, but CEO Darren Woods stated in an interview that the company did not intend to adopt provisions of Texas law?that allows companies to make shareholder proposals more difficult. Woods stated that "that's in no way influencing" the decision to move. "We are quite satisfied with the engagements we have had with our shareholders." Longtime environmental lawsuits have been filed against the top U.S. producer of oil, which is physically located in Spring, Texas. In 2022, officials in New Jersey will sue Exxon, Chevron, and other fossil fuel companies, claiming that these companies contributed to climate changes, forcing the state's budget to be slashed by billions to clean up following major natural disasters like Superstorm Sandy and hurricane Ida. The lawsuit was dismissed in 2017. Jill Fisch is a professor of law at the University of Pennsylvania. She said that incorporating in the state where a company has its headquarters could help executives gain the attention of politicians who can assist them with tax questions or other issues. She said that one way to show loyalty to your state and to get legislators to take notice of you would be to incorporate in your home state. Exxon has its roots in New Jersey dating back to the breakup Standard Oil in early 1900s. Its headquarters, however, have been in Texas since 1988. Exxon introduced a new program in September to prevent activist shareholder resolutions at annual meetings. The program allows retail investors to vote automatically according to the board's recommendation. The company said that individuals held nearly 40% of its shares, but only a quarter voted during the proxy season. They mainly supported the board. Texas is trying to strengthen its reputation as an ideal place for doing business. It has benefited from the fact that many companies are leaving states like Delaware, which was a popular destination for incorporation. Reporting by Sheila Dang from Houston and Ross Kerber from Boston. Nathan Crooks (Editing), Muralikumar Anantharaman, Mark Potter and Nathan Crooks.
As the war continues, both low and high income US consumers could be hit by higher gasoline prices, volatile stock, and rising stocks.
The U.S. and Israel war against?Iran is likely to hit consumers hard across the United States' economic spectrum. This could undermine a key component of the economy that was?expected? to boom this year due in part because of a hefty income tax refund, low unemployment and rising asset prices.
Analysts felt that both "spurs", of the U.S.'so-called K-shaped economic model, could maintain or even increase spending in the upcoming months. Wealth effects would lead better-off families and service industry workers to spend more, while windfall tax refunds due to 'new exemptions on overtime and tip income, helped hourly workers.
Both sides may be under pressure from different sources. According to American Automobile Association, the average national gasoline price topped $3.50 per gallon on Tuesday morning. This is a 17% increase from the $3.50 average before the start of the conflict. Prices have risen above $3 a gallon in all states except Kansas. Oil markets are still volatile due to the shipping disruptions along the Strait of Hormuz, so analysts predict that gas prices could reach $4 if the conflict continues. The stock market has fallen from its highs, and uncertainty over what comes next is a major factor for household spending, which is based on increasing net worth. President Donald Trump hinted on Monday at a quick resolution to the conflict, sending stocks higher. However, overnight, he changed his tone and warned of the risks of an extended conflict, including the impact on global supply chains, commodity prices, and corporate earnings.
The major U.S. stocks indices showed little change when the trading began on Tuesday.
Rising?gasoline prices could cause lower-income families to cut back on other spending categories, causing businesses to suffer, which could lead them to reduce their investment and job plans.
The longer the oil price stays high, the more it will hurt consumers and drag the economy down. Prices at a particular level for a period of time can change from a positive impact on GDP to a negative one, increasing the probability of a recession. This is what Luke Tilley said, chief economist of Wilmington Trust. Oil prices in the range of $85-$100 per barrel for several months will "materially increase" the risk of a recession, because the labor market has been in a difficult state.
Benchmark Brent crude rose to $116 per barrel on Monday, then fell below $90. It rose again on Tuesday. U.S. defense secretary Pete Hegseth has said that Tuesday will see the most intensive strikes against Iran. A top general also spoke of targeting Iran's ability to lay mines on the Strait of Hormuz as a possible move towards reopening the shipping through the chokepoint, where the Middle East oil movement is all but stopped.
The sudden change in the risks facing the U.S. economy and the global economy posed a challenge for central bank policymakers. This was especially true in the U.S. where officials saw a strong economy with a balance of risks, including inflation about a point above the 2% target, but which was expected to decline, and a stable unemployment rate in a range between 4.3% and 5%, without any consensus on whether it would spike higher.
This view is now being challenged by both sides.?With the economy having already shed jobs in February, the uncertainty caused by the conflict may cause businesses to be more cautious when it comes to hiring. Meanwhile, inflation could increase if oil prices rise and affect other costs, such as shipping rates or home heating expenses.
The current environment poses risks, even though higher fuel costs may only have a temporary impact on inflation or could even reduce broader price pressures if consumers divert spending to other areas, and growth overall slows. Kansas City Fed researchers conducted an analysis after oil prices jumped in 2022, following Russia's invasion in Ukraine. They concluded that increases in gasoline prices can have a large impact on household inflation expectations.
Investors expect the Fed will cut interest rates in this year. However, the timing has shifted after the beginning of U.S. Military action. A potential standoff is developing between policymakers over inflation and growth concerns.
Next week, the Fed is expected to maintain its current policy rate of 3.5% to 3.75%.
Vincent Reinhart, former Fed top staffer and chief economist at BNY Investments, said that it is too early to make any predictions about the economic impact of the conflict. Even concerns over the impact on the economy have to be tempered because the U.S. is a net producer of energy, which means that higher global prices could mean higher gas prices for U.S. customers, but it would also mean more income and jobs for U.S. energy companies.
The longer oil prices stay high, the greater the risk. A barrel costing $90 or more for a period of a month could be a material shock which would start to undermine consumption and growth.
Reinhart stated that "you have to have oil prices significantly higher than people's expectations" for a shock in the U.S. economic system to be a success. It has to be large enough. "We're not big enough."
(source: Reuters)