Diplomats said the draft text was backed by other Gulf Arab states and the United States, although they said it was unlikely to succeed

International News via Reuters:

Bahrain has put forward a draft United Nations Security Council resolution that would authorise countries to use “all necessary means” – diplomatic language for force – to protect commercial shipping in and around the Strait of Hormuz, according to a text seen by Reuters on Monday.

Diplomats said the draft text was backed by other Gulf Arab states and the United States, although they said it was unlikely to succeed.  

The move underscores mounting concern in the region that Iran could continue to threaten the Strait of Hormuz, a strategic chokepoint that carries about a fifth of global oil supplies and underpins Gulf economies. 

Closing the Strait has been one of Iran’s main objectives. Shipping through the waterway has ground to a near-⁠halt after Iran hit vessels in its conflict with the U.S. and Israel. 

The draft resolution calls Iran’s actions a threat to international peace and security.

The text would authorise countries, acting alone or through voluntary multinational naval coalitions, to use “all necessary means” in and around the Strait of Hormuz – including in the territorial waters of littoral states – to ensure passage and to prevent moves that block or interfere with international navigation.

The resolution also expresses the readiness to impose measures, including targeted sanctions. 

The Bahraini and U.S. missions at the United Nations did not immediately respond to requests for comment.

The draft text “demands that the Islamic Republic of Iran immediately cease all attacks against merchant and commercial vessels and any attempt to impede lawful transit passage or freedom of navigation in and around the Strait of Hormuz.”

Two European and one Western diplomat said there was little prospect of such a resolution being adopted by the Security Council as Iran’s allies Russia and China were likely to veto the text if needed. 

A resolution needs at least nine votes in favour and no vetoes by Russia, China, the U.S., Britain and France to be adopted by the 15-member body. 

The Russian and Chinese missions to the United Nations were not immediately available for comment.

However, the diplomats said France was also working on an alternative draft resolution that would seek a U.N. mandate once the situation had calmed.

Three U.S. officials have told Reuters that 2,500 Marines, along with the USS Boxer, an amphibious assault ship, and accompanying warships would deploy to the region, although they did not say what their role would be.

Two officials said there had been no decision on whether to send troops into Iran itself. Sources previously told Reuters that possible targets could include Iran’s coast or Kharg Island oil export hub.  

The resolution would be placed under Chapter Seven of the U.N. Charter, which allows the council to authorize actions ranging from sanctions to the use of force.  

Additional reporting by David Brunnstrom in Washington; Editing by Cynthia Osterman

The 1.42-billion-euro ($1.65 billion) joint venture includes UPM’s communication papers unit and Sappi’s graphic paper business in Europe

International News via Reuters:

EU antitrust regulators will decide by April 28 whether to approve a proposed graphic paper joint venture between Finnish forestry firm UPM-Kymmene and South Africa-listed wood fibre group Sappi, according to a filing on the European Commission site.

The 1.42-billion-euro ($1.65 billion) joint venture includes UPM’s communication papers unit and Sappi’s graphic paper business in Europe.

UPM will contribute assets in Germany, Finland, Britain and the United States to the joint venture while Sappi’s contribution will come from assets in Austria, Germany, the Netherlands and Finland.

The deal comes amid falling demand in the industry due in part to digitalisation, structural overcapacity, high energy costs and rising paper imports from Asia and Latin America.

The Commission, which acts as the EU competition enforcer, can clear the deal with or without demanding concessions after its preliminary review or it can open a full-scale investigation subsequently if it has serious concerns.

($1 = 0.8628 euros)

Reporting by Foo Yun CheeEditing by Tomasz Janowski

Consumer confidence fell to -16.3 this month from a revised -12.3 in February, coming well below expectations for -14.4 in a Reuters poll of economists

International News via Reuters:

Euro zone consumer confidence fell to its lowest level since late 2023 this month, a European Commission survey showed on Monday, offering early evidence of how the war with Iran and surging energy prices may impact the broader economy.

Consumer confidence fell to -16.3 this month from a revised -12.3 in February, coming well below expectations for -14.4 in a Reuters poll of economists. For the broader EU, the indicator fell to -15.2 from -11.8, the Commission said in a flash release that will be followed by more detailed results later this week.

“The four-point drop in March is one of the largest falls on record other than at the start of the pandemic and the Ukraine conflict,” Andrew Kenningham at Capital Economics said. “Based on our current working assumptions about oil and gas prices, we think household spending will decline and cause GDP to stagnate over the next two quarters.”

PRICE GROWTH SEEN ACCELERATING

Oil prices have surged since the start of the U.S. and Israeli war on Iran, pushing up household fuel costs immediately and raising the prospect of rapid inflation.

This has already raised borrowing costs for households, including through some mortgage rates, as financial investors think the European Central Bank will be forced to raise interest rates to curb price pressures.

This is likely to be especially painful for households as they are hit with higher pump prices and increased borrowing costs, eroding their disposable income.

All this is coming as wage pressures have finally dissipated in the euro zone, according to the ECB’s own wage tracker, which shows negotiated wage growth of 2.6% this year, a figure that is largely consistent with inflation holding at the bank’s 2% target.

However, price growth is now certain to accelerate given the spike in energy costs and the ECB’s most benign scenario sees it jumping to 2.6% this year and the severe scenario putting it above 4%.

While the ECB normally looks past such energy price surges, policymakers said they will raise interest rates if there is risk that price growth is getting entrenched.

“We can do little about the inflation spike in the next few months,” ECB policymaker Peter Kazimir said. “But if we judge that the risk of inflation remaining above our target for a prolonged period is significant, we will act with appropriate forcefulness to bring inflation back down to our target.”

Reporting by Rafal Nowak in Gdansk and Balazs Koranyi in Frankfurt; Editing by Alison Williams