A senior Iranian official told Reuters that Tehran is positively reviewing Pakistan’s request for a two-week ceasefire

International News via Reuters:

Pakistan, a mediator between the U.S. and Iran, on Wednesday requested that U.S. President Donald Trump grant a two-week extension to a deadline he imposed on Iran to end its blockade of Gulf oil.

A senior Iranian official told Reuters that Tehran is positively reviewing Pakistan’s request for a two-week ceasefire. The White House said Trump is aware of Pakistan’s proposal, saying a response will come.

“To allow diplomacy to run its course, I earnestly request President Trump to extend the deadline for two weeks. Pakistan, in all sincerity, requests the Iranian brothers to open Strait of Hormuz for a corresponding period of two weeks as a goodwill gesture,” Pakistani Prime Minister Shehbaz Sharif said in a post on X.

Sharif’s comments come after Trump, in a social media post that shocked world leaders, said that “a whole civilization will die tonight”

Trump has given Iran until 8 p.m. EDT (0000 GMT) in Washington – 3:30 a.m. on Wednesday in Tehran – to end its blockade of Gulf oil or see the U.S. destroy every bridge and power plant in Iran.

Sharif urged “all warring parties” to observe a ceasefire everywhere for two weeks “to allow diplomacy to achieve conclusive termination of war”.

He added that diplomatic efforts to settle the war peacefully were “progressing steadily, strongly and powerfully with the potential to lead to substantive results in near future”.

Sources told Reuters on Tuesday that talks between the U.S. and Iran were at risk of being derailed following Tehran’s attacks on Saudi Arabian industrial facilities.

Pakistan has been the main go-between for proposals shared by Iran and the United States, but there has been no sign of a compromise.

Reporting by Gursimran Kaur in Bengaluru; Editing by Franklin Paul, Cynthia Osterman and Alistair Bell

The 15-member Security Council voted 11 in favor of the resolution presented by Bahrain, with two against – China and Russia – and two abstentions

International News via Reuters:

China and Russia on Tuesday vetoed a U.N. resolution encouraging states to coordinate efforts to protect commercial shipping in the Strait of Hormuz, calling the measure biased against Iran, while Washington’s ambassador to the world body called on “responsible nations” to join the U.S. in securing the waterway.

The 15-member Security Council voted 11 in favor of the resolution presented by Bahrain, with two against – China and Russia – and two abstentions.

U.S. President Donald Trump threatened that “a whole civilization will die tonight” as Iran showed no sign of accepting his ultimatum to open the Strait of Hormuz by Tuesday evening, Washington time.

Oil prices have surged since the U.S. and Israel struck Iran at the end of February, unleashing a conflict that has run for more than five weeks while Tehran has largely closed the strait that was previously the route for about a fifth of global oil and liquefied natural gas.

“The draft resolution has not been adopted, owing to the negative vote of a permanent member of the Council,” Bahrain’s Foreign Minister Abdullatif bin Rashid Al Zayani said.

U.S. AMBASSADOR CONDEMNS THE VETOES

The U.S. ambassador to the United Nations, Mike Waltz, condemned the Russian and Chinese vetoes, saying they marked “a new low” when Iran’s shutting of the Strait was preventing medical aid and supplies reaching humanitarian crises in the Congo, Sudan and Gaza.

“No one should tolerate that. They are holding the global economy at gunpoint. But today, Russia and China did tolerate it. They sided with a regime that seeks to intimidate the Gulf into submission, even as it brutalizes its own people.”

Waltz said Iran could choose “to reopen the Strait, to seek peace and to make amends.”

He added, “But until then and afterwards, we call on responsible nations to join us in securing the Strait of Hormuz, protecting it, ensuring that it remains open to lawful commerce, to humanitarian goods, and the free movement of the world’s goods.”

France deplored the vetoes.

“The aim was to encourage strictly, purely defensive measures to provide the security and safety for the Strait without spiraling towards escalation,” its U.N. ambassador, Jerome Bonnafont, said.

RUSSIANS AND CHINESE SAY TEXT WAS BIASED

Russia and China said the resolution was biased against Iran, and China’s U.N. envoy Fu Cong said adopting such a draft when the U.S. was threatening the survival of a civilization would have sent the wrong message.

Russia’s U.N. ambassador Vasily Nebenzya said Russia and China were proposing an alternative resolution on the situation in the Middle East, including maritime security.

Iran’s U.N. ambassador Amir Saeid Iravani praised the Chinese and Russian moves, saying “their action today prevented the Security Council from being misused to legitimize aggression.”

Iravani added that the U.N. secretary-general’s personal envoy was currently en route to Tehran to pursue consultations.

China and Russia used their vetoes even though Bahrain had significantly weakened its draft after China opposed authorizing force.

The draft submitted to a vote dropped any authorization of the use of force. An explicit reference to binding enforcement, included in an earlier draft, was also left out.

Instead the text strongly encouraged states “to coordinate efforts, defensive in nature, commensurate to the circumstances, to contribute to ensuring the safety and security of navigation across the Strait of Hormuz.”

It also said such contributions could include “the escort of merchant and commercial vessels,” and endorsed efforts “to deter attempts to close, obstruct or otherwise interfere with international navigation through the Strait of Hormuz.”

Reporting by David Brunnstrom; Editing by Caitlin Webber, Barbara Lewis and David Gregorio

A key risk is that consumers and businesses, who experienced runaway prices only four years ago following Russia’s invasion of Ukraine, may quickly adjust their own expectations

International News via Reuters:

Euro zone inflation expectations are at risk of rising more quickly than in the past and the European Central Bank must be ready to raise interest rates swiftly if signs of persistent price pressures emerge, ECB policymaker Dimitar Radev said.

Surging energy costs prompted by the Iran war have already pushed inflation well above the ECB’s 2% target and policymakers are now debating whether to tighten policy to prevent this increase from becoming embedded in the price of other goods and services, setting off a self-reinforcing price spiral.

“The balance of risks has shifted in an unfavourable direction,” Radev, head of Bulgaria’s central bank and one of the newest members of the ECB’s Governing Council, told Reuters in an interview.

“While the baseline remains our reference, the likelihood of a more adverse scenario has increased, particularly in light of the energy shock and the elevated level of uncertainty,” he said, referring to the three economic scenarios – adverse, baseline and severe – outlined by the ECB last month.

A key risk is that consumers and businesses, who experienced runaway prices only four years ago following Russia’s invasion of Ukraine, may quickly adjust their own expectations, demanding higher prices and wages, and setting off an inflation spiral, which then proves costly to extinguish.

BEHAVIOURS HAVE CHANGED

“Recent inflation developments appear to have increased the responsiveness of expectations, meaning that pass-through from new shocks can occur more quickly than under normal conditions,” Radev said.

His comments echo warnings from a host of other policymakers who have stopped short of explicitly calling for rate hikes but have said the ECB needs to stand ready to pull the trigger.

For now inflation expectations are holding at the ECB’s target and second-round inflation effects are not visible in data such as the March inflation reading, which showed a jump on energy but signalled slowing price pressures for services.

But the ECB cannot take such a benign outcome for granted because the environment is fragile and prone to quick changes, Radev said.

“If the shock persists and begins to affect wages, margins and expectations, the cost of inaction would increase,” he said. “In such a situation, acting in a timely manner would be the more prudent course.”

This risk is a key reason why financial markets have priced in more than two interest rate hikes from the ECB this year, with the first expected in June.

Radev said it was too early to say whether the ECB would have enough data by the time of its April 30 meeting to make a call but it would have sufficient data to allow for a more concrete and structured policy discussion.

The bank will be especially attentive to various measures on inflation expectations, underlying price figures, sentiment indicators, energy price developments and, most importantly, signals regarding the length of the Iran war and its effects.

While the 2022 experience could make consumers more edgy, Radev also acknowledged that the euro zone entered this crisis from a better position since interest rates are already higher, and inflation expectations are anchored.

The big risk now is that governments start implementing subsidies that could potentially add fuel to the fire, he added.

For the Q&A of this interview, click here.

Editing by Gareth Jones

The Iran war has forced the shutdown of at least 12 million barrels per day – about 12% of world supply – from the Middle East due to Iran’s effective closure of the Strait of Hormuz

International News via Reuters:

European and Asian refiners are paying record high prices of near $150 a barrel for some crude oil grades, far exceeding prices for paper futures, highlighting the worsening supply crisis from the U.S.-Israel war with Iran.

The Iran war has forced the shutdown of at least 12 million barrels per day – about 12% of world supply – from the Middle East due to Iran’s effective closure of the Strait of Hormuz. As a result, Brent oil futures reached $119.50 a barrel last month, the highest since 2022 although still short of the 2008 record high of $147.50. The nearby Brent contract is for June delivery.

Competition for supply from Asian and European refiners to replace disrupted Middle Eastern oil flows has helped to drive up the prices of replacement crudes for more immediate delivery, such as those in Europe and Africa.

As a result, some crudes are hitting records already. The outright price of North Sea Forties crude reached $146.09 a barrel on Tuesday, according to LSEG data, above the 2008 level and an all time high.

The main driver of prices such as that of Forties is “panic” over supplies, said Adi Imsirovic, a veteran oil trader. “When there is a real, physical shortage, people are not thinking about July delivery  – June loading and hence June futures prices –  but oil NOW.” 

The price of Forties and many other cargoes around the world is linked to the physical crude benchmark called dated Brent which is trading almost $20 higher than the price of Brent futures for June delivery according to LSEG data because it reflects the price of cargoes for immediate delivery. 

“At the moment, the market  is scrambling for prompt, refinery-usable barrels, and stress is appearing first in the part of the benchmark that is closest to the immediate physical problem,” Morgan Stanley analysts said in a report.

Oil price benchmark publisher S&P Global Energy Platts assessed the price of dated Brent on April 7 at $144.42, surpassing the previous record high of $144.22 reached in 2008, a Platts spokesperson said. Using the Platts dated Brent figure would put the price of Forties, and many other physical cargoes, well above $150.

Prices of refined products in Europe were close to record highs on Tuesday.

Jet fuel prices in Europe hovered at $226.40 a barrel, close to a record high hit in mid-March, LSEG data shows. Diesel prices were still shy of their record highs hit in 2022, standing at $203.59 a barrel on Tuesday. 

Additional reporting by Seher Dareen, editing by Dmitry Zhdannikov and Alistair Bell