Global Pulse

分类： business

  • Ford to partner with Chinese automaker Geely in Spain in new joint venture

    Ford to partner with Chinese automaker Geely in Spain in new joint venture

    On Thursday, two major global automotive players — U.S.-based legacy manufacturer Ford and China’s leading new energy vehicle maker Geely Auto — unveiled a landmark joint venture plan to produce low- and zero-emission vehicles at Ford’s existing manufacturing facility in Valencia, Spain. The partnership marks a strategic pivot for both companies, as Ford races to regain its fading foothold in the competitive European auto market and Geely expands its regional production footprint to bypass trade barriers amid a global electric vehicle transition.

    Pending final regulatory approval, the new joint venture will be 66.7% owned by Ford, with Geely holding the remaining 33.3% stake. This is not the first collaboration between the two firms: Ford sold its Volvo Cars brand to Geely back in 2010, a transaction that laid early groundwork for today’s deeper cooperation. Geely, which already owns a portfolio of global auto brands including Volvo, Polestar, and Lynk & Co, will bring its expertise in cost-efficient new energy vehicle manufacturing to the partnership.

    Five distinct vehicle models are scheduled to roll off the Valencia plant’s assembly lines starting in 2028. Ford will continue production of its popular Kuga plug-in hybrid at the facility, and add a new Bronco SUV to the production lineup. Geely will manufacture two all-electric SUV models at the site, while the two companies will jointly develop a new multi-energy crossover vehicle that accommodates both hybrid and fully electric powertrains. All five new model lines are scheduled to launch production by 2028.

    For Ford, the partnership comes at a make-or-break moment for its European operations. A decade ago, Ford sold more than 1 million vehicles annually across Europe; by last year, that number had dropped below 500,000. The Valencia plant, which boasts a total annual production capacity of 500,000 vehicles, only produced fewer than 100,000 units in 2025, leaving massive underutilized capacity. The joint venture will allow Ford to split development and production costs with Geely, bringing the plant’s operations closer to industry cost benchmarks while retaining existing manufacturing jobs at the site.

    The collaboration also reflects the shifting dynamics of the global auto industry, driven by rising Chinese new energy vehicle dominance and growing geopolitical friction around EV trade. U.S. tariff policy has effectively blocked Chinese auto manufacturers from full access to the American domestic market, even as Chinese EV makers gain market share across other global regions, from Southeast Asia to Latin America and Europe. Geely’s local production in Spain allows the company to avoid European Union tariffs on imported vehicles, giving it a stronger competitive position in the region.

    In a joint statement, the two companies noted the joint venture was structured to address the core new realities of the European market: cutthroat global competition, persistent upward cost pressure, and increasingly strict emissions regulations. The venture resets the Valencia facility to operate at the emerging cost benchmark for the global auto industry, the statement added.

    The partnership aligns with Ford’s broader global strategy, even as the company’s leadership has echoed concerns about Chinese EV competition in the U.S. market. During Ford’s first-quarter 2025 earnings call in April, CEO Jim Farley explained the company’s nuanced approach to global partnerships. “We leverage global partnerships and even IP sharing, including with Chinese companies, to grow our business around the world,” Farley said. “Ford continues to be a global company. We want to have the rights to win around the globe, and we need IP and partnerships outside the U.S. to do that. When it comes to the U.S. industry itself, we are extremely protective, as we should be.”

    Chinese automakers have rapidly gained global market share in recent years, building high-quality, technologically advanced hybrid and pure electric vehicles at far lower price points than many legacy Western manufacturers, a boost partially supported by decades of targeted government subsidies. While slowing domestic demand in China, driven by reduced consumer purchase incentives and cutthroat domestic competition, has pushed Chinese firms to accelerate global expansion, geopolitical and market shifts have also opened new doors. Ongoing conflict in the Strait of Hormuz has disrupted global crude oil and natural gas supplies, spurring greater consumer demand for affordable electric vehicles worldwide, a trend that has benefited Chinese EV makers.

    Industry analysts broadly frame the Ford-Geely partnership as a blueprint for the future of the global auto transition. “This deal offers a road map for how traditional automakers can survive and thrive in Europe,” said Jessica Caldwell, head of insights at automotive research firm Edmunds. “Ford gets the scale and cost efficiencies it needs for its Valencia plant, while Geely gets a direct shortcut around EU tariffs. More broadly, it underscores a major industry shift we’re likely to continue seeing: automakers can no longer go it alone and must collaborate with rivals — Chinese or otherwise — to survive the capital-intensive transition to electrification.”

    The deal also comes amid a deeply uncertain policy environment for EV adoption in the U.S. Over the past several years, the current U.S. administration has rolled back many of the clean vehicle policies put in place by the previous administration, weakening corporate average fuel economy rules and tailpipe emissions standards, eliminating the previous target of 50% electric new vehicle sales by 2030, and allowing federal tax credits for new and used EV purchases to expire. This policy uncertainty has led many U.S. automakers to view the European EV market as a more stable growth opportunity, even as it requires new cooperative models to remain competitive.

    Sam Fiorani, vice president at AutoForecast Solutions, noted that Ford had already been steadily reducing its exposure to the European market for years, much like its domestic rival General Motors. “Now, with the help of Geely, Ford can have new products designed for the European market without bearing the full development costs of a new platform,” Fiorani explained. “While Chinese automakers like Geely continue their growth around the world, Ford should take this opportunity to learn how to cut costs and develop lower-priced vehicles. If Ford cannot compete on price in Europe, the automaker may need to look at selling plants outright rather than sharing them. Losing Europe could hurt Ford’s standing as a global automaker, but continuing to have the region drain its finances could be more devastating.”

  • Oil prices hit $100 for the first time since May

    Oil prices hit $100 for the first time since May

    Global energy markets have been sent into a fresh period of volatility this week, as benchmark Brent crude oil prices crossed the $100 per barrel threshold for the first time since May, driven by escalating military tensions across the Middle East that have renewed widespread concerns over the security of international energy supply chains.

    After a multi-day rally that accelerated sharply on Thursday, the global oil benchmark jumped more than 6% following an expansion of U.S. military operations targeting Iran. The sharp upward price movement was triggered directly by attacks on commercial oil tankers transiting the Red Sea carried out by Yemen’s Houthi militia. The Red Sea serves as a critical alternative export corridor for Saudi Arabia, allowing the kingdom to route oil shipments bypassing the Strait of Hormuz, the world’s other most vital chokepoint for global energy trade.

    Alongside crude oil, natural gas prices have climbed steadily over the past four weeks. The United Kingdom’s wholesale gas benchmark now trades near 150 pence per therm, a sharp jump from the 98 pence recorded at the end of June.

    This latest rally marks a sharp reversal from the market downturn that followed a brief temporary ceasefire between Washington and Tehran earlier this year. After the ceasefire took effect, oil prices fell back to levels last seen before the U.S. and Israel launched military actions against Iran on February 28. That ceasefire has since collapsed, and this week U.S. Secretary of State Marco Rubio confirmed that Iranian leadership remains “not ready to make a deal” to de-escalate tensions.

    The sustained escalation in the Middle East now carries significant risks of rekindling inflation across major developed economies, including the U.K. and U.S., forcing higher costs onto consumers at every level of the supply chain. By default, higher crude prices translate directly to increased costs for petrol and diesel. While motorists bear the immediate brunt of these increases, households across all income brackets will also see upward pressure on the prices of everyday goods, most notably food, as transport-dependent businesses pass elevated fuel costs onto end customers.

    Prior to this latest market shock, both the U.K. and U.S. had recorded steady declines in inflation. The U.K.’s annual inflation rate fell to 2.6% in June, a drop driven in large part by cooling fuel prices, while U.S. inflation settled at 3.5% over the same period. Analysts now warn that these downward trends could prove temporary if energy prices remain at their current elevated levels.

    Fresh industry data published Thursday already reflects early price increases at the pump. In the U.K., the RAC motoring group reports that average petrol prices have risen 5 pence per liter since the start of July, hitting nearly £1.56 per liter, while average diesel now stands at £1.72 per liter. Across the Atlantic, U.S. motor advocacy group AAA confirms that the national average price for gasoline has once again crossed the $4 per gallon threshold, up from $3.92 just one month ago.

    “More expensive fuel and energy can ripple through the wider economy, increasing costs for businesses and ultimately feeding through into the price of food and other goods,” explained Jonathan Raymond, an investment manager at Quilter Cheviot. “This creates another headache for central banks as they continue their battle against inflation. If energy prices remain elevated, policymakers may come under pressure to keep interest rates higher for longer or even raise them. This would come as a blow to mortgage holders and borrowers already feeling the strain.”

    The Bank of England, which has held its baseline interest rate at 3.75% through four consecutive policy meetings, is widely expected to hold rates steady again at its next gathering, according to Paul Dales, chief U.K. economist at Capital Economics. Dales added that most analysts still project rate cuts will begin next year if energy price increases stabilize and cool off.

    In the U.S., newly appointed Federal Reserve Chair Kevin Warsh signaled a hardline stance on persistent inflation during recent testimony before Congress, stating that the central bank has “no tolerance to persistently elevated inflation.” Former President Donald Trump, who pushed Warsh’s predecessor Jerome Powell to implement deep rate cuts, has repeatedly made clear he expects Warsh to deliver lower borrowing costs for American households. Despite this pressure, the Fed held rates steady in a range of 3.5% to 3.75% at Warsh’s first policy meeting last month, and he reaffirmed to Congress his commitment to “restoring price stability” in the face of new inflationary pressure from Middle East supply risks.

  • Zimbabwe exports first batch of blueberries to China as new market opens

    Zimbabwe exports first batch of blueberries to China as new market opens

    A landmark milestone for Zimbabwe’s horticultural sector has put the southern African nation on a new path of agricultural trade expansion, as it dispatched its first ever commercial consignment of blueberries to the Chinese market in 2026. This breakthrough comes after Beijing and Harare finalized a bilateral phytosanitary protocol in September 2025, formally clearing the way for Zimbabwean blueberry producers to access one of the globe’s largest and fastest-growing consumer markets.

    Beyond market access, Zimbabwean producers are set to gain an additional competitive edge from China’s zero-tariff policy, which applies to qualifying export products from Zimbabwe. This policy eliminates import duties for the fruit, making Zimbabwean blueberries more affordable and attractive to Chinese buyers when stacked against competing international suppliers. Currently ranked as Africa’s third-largest blueberry producer, trailing only Morocco and South Africa, Zimbabwe is projecting its total 2026 blueberry exports to hit 12,000 metric tons, a notable increase from the 9,500 tons exported in 2025.

    In response to this new trade opening, Zimbabwe’s Horticultural Development Council (HDC) has called on local blueberry growers to ramp up production output to match the expected demand from China’s 1.4-billion-consumer market. “China has opened the door,” HDC Chief Executive Officer Linda Nielsen noted at a recent investment gathering in Harare. “As Zimbabwe, we must now make sure we have enough product to walk through it.”

    Nielsen emphasized that China’s broader zero-tariff initiative, which extends to eligible goods from 53 African countries that maintain diplomatic relations with Beijing, creates a transformative, long-term opportunity for Zimbabwe’s entire agricultural export sector. She added that for local producers, the barrier to growth is not lack of market access, but the challenge of scaling production to meet existing and new demand.

    To date, industry data from the HDC shows that Zimbabwe has already expanded its blueberry cultivation area from 650 hectares in 2025 to 850 hectares in 2026, a shift that reflects rising investor confidence in the high-value, nutrient-dense fruit. Alistair Campbell, a representative of the Zimbabwe Berry Growers Association, noted that the country is quickly solidifying its position as one of Africa’s top blueberry producers. The fast-expanding blueberry sector already makes a substantial contribution to Zimbabwe’s national economy, while generating much-needed jobs for rural communities across the country. Today, blueberries stand as one of Zimbabwe’s emerging high-value horticultural crops, with commercial production concentrated in the Mashonaland East, Mashonaland West, and Mashonaland Central provinces.

  • Oil soars to $100 on fresh Mideast attacks

    Oil soars to $100 on fresh Mideast attacks

    Escalating geopolitical tensions across key Middle Eastern shipping lanes have sent global oil prices surging toward the $100 per barrel threshold, sparking widespread uncertainty across international financial markets on Thursday. The latest upward price movement came in response to continued attacks on Red Sea commercial shipping by Iran-aligned Houthi rebels, paired with a sharp threat of major military retaliation against the group from former U.S. President Donald Trump.

    Brent Crude, the global benchmark for international oil trade, jumped more than 5.7% to settle near $99.42 per barrel by 1100 GMT, just a hair below the psychologically significant $100 mark that investors and analysts have warned would signal a major shift in global energy market dynamics. U.S. benchmark West Texas Intermediate crude also climbed 4.5% to reach $90.75 per barrel.

    The disruption to Red Sea shipping has emerged as a critical flashpoint for energy markets, as Saudi Arabia has re-routed millions of barrels of oil exports through the waterway that normally pass through the Strait of Hormuz – another strategically vital energy choke point already facing elevated geopolitical risk. A prolonged closure or sustained disruption to either route would pull substantial volumes of oil off the global market, tightening supplies even further.

    Neil Wilson, a UK-based investor strategist at Saxo, noted that there are currently no visible signs of a diplomatic breakthrough to de-escalate tensions, as both the U.S. and Iran have adopted hardened positions. “Investors are in a wary mood, as fresh jitters over the ongoing energy crunch hit market sentiment,” added Susannah Streeter, chief investment strategist at Wealth Club. “With both the Strait of Hormuz and the Red Sea now under increasing pressure, markets are bracing for the possibility that the conflict could disrupt key energy routes and keep oil prices elevated for an extended period.”

    Higher sustained oil prices also raise the specter of renewed global inflationary pressure, which could force central banks around the world to hold interest rates higher for longer – or even implement additional rate hikes. This dynamic was on full display Thursday, as European Central Bank President Christine Lagarde confirmed that some policymakers had considered a rate hike at the bank’s latest monetary policy meeting before the governing council ultimately voted to hold rates steady.

    Major U.S. stock markets tumbled in early trading, with all three primary benchmark indices falling more than 1% by mid-session. The tech-heavy Nasdaq Composite led the declines, dropping 1.8%, as all of the so-called Magnificent Seven large-cap technology stocks ended the day in negative territory. Shares of Alphabet fell 6% after the company raised its full-year artificial intelligence capital expenditure forecast to as much as $205 billion, a figure far higher than Wall Street analysts had projected. Tesla shares slumped 9.6% following a weaker-than-expected quarterly profit report and an announcement that the firm would double its capital expenditure compared to the same quarter in 2025.

    Patrick O’Hare, an analyst at Briefing.com, pointed out that the scale of the index-level losses was not out of line with broader market conditions, noting that many non-tech stocks received a boost from positive earnings reports and that weekly U.S. unemployment claims data offered a reassuring signal about the strength of the domestic labor market. Even so, investor confidence in the AI sector has been tested in recent months, as concerns mount over stretched valuations and questions linger over when the trillions of dollars invested in the space will generate meaningful returns. Market participants are now turning their attention to next week’s earnings reports from Microsoft, Meta, and Amazon, which will be closely scrutinized for details of the companies’ planned capital spending.

    Global market performance was mixed across regions on Thursday. Most major Asian stock markets recorded modest gains, buoyed by a long-awaited bounce for regional technology firms. Japan’s Nikkei 225 closed up 0.5%, while Hong Kong’s Hang Seng Index gained 1.3% and Shanghai’s Composite index edged up 0.3%. In contrast, European markets traded lower across the board in afternoon dealing, with London’s FTSE 100 falling 0.9%, France’s CAC 40 dropping 1.8%, and Germany’s DAX declining 1.5%.

    In currency markets, the U.S. dollar strengthened against most major peer currencies. The Japanese yen hit a fresh four-decade low against the dollar, as investors priced in the persistent gap between the Bank of Japan’s ultra-low interest rate policy and the higher rates maintained by the U.S. and other major advanced economies. Rising oil prices and broader concerns over the outlook for Japan’s economy have added additional downward pressure on the yen in recent trading sessions.

  • Europe’s central bank holds rates steady amid swings in oil prices

    Europe’s central bank holds rates steady amid swings in oil prices

    FRANKFURT, Germany — Against a backdrop of swirling geopolitical tensions and wildly fluctuating energy markets, the European Central Bank (ECB) announced Thursday it will keep its benchmark interest rate unchanged at 2.25%, hitting pause on monetary tightening just one month after its last quarter-point adjustment.

    The June 11 rate increase had been explicitly crafted to counter inflationary pressure driven by spiking global oil prices, which surged after conflict between the U.S. and Iran disrupted critical oil shipping lanes through the Strait of Hormuz. Since that decision, however, energy markets have seesawed dramatically: prices fell sharply following a brief ceasefire announcement, only to rebound once the truce collapsed and hostilities resumed, leaving policymakers scrambling to assess the long-term trajectory of inflation.

    Speaking at a post-meeting press conference, ECB President Christine Lagarde emphasized that persistent uncertainty surrounding the energy price shock has left the bank unable to map out a fixed path for future rate moves. “Uncertainty remains high and the full inflationary impact of the energy shock has yet to play out,” Lagarde told reporters. “We are therefore closely monitoring the intensity and duration of the shock, as well as its indirect and second round effects…the longer energy prices stay high, the more likely they are to drive up broader inflation.”

    Lagarde confirmed the ECB will take a data-dependent, meeting-by-meeting approach to future policy decisions, refusing to pre-commit to any specific trajectory for borrowing costs. Most economists now see the ECB’s September 10 policy meeting as the most likely timeline for a potential additional rate increase if inflationary pressures do not abate.

    In addition to monetary policy questions, Lagarde addressed speculation about her tenure, pushing back against requests for a rigid “yes or no” commitment to serving out her full eight-year term set to end in October 2027. “I hate to be boxed in in any particular circumstances,” she said, before adding: “you are not going to see the back of me before 2027. When there are clouds on the horizon, the captain stays on the ship, and this captain is staying on this ship as long as there are clouds on the horizon.”

    The ECB’s rate hold comes as fresh geopolitical turmoil sent global oil prices surging to key new thresholds Thursday. International benchmark Brent crude climbed above $100 per barrel for the first time in two months, after Iran-aligned Houthi rebels in Yemen claimed responsibility for attacks on two Saudi oil tankers in the Red Sea. The attack has stoked fears that ongoing Middle East conflict could widen and disrupt alternative shipping routes that Saudi Arabia has increasingly relied on to avoid closures in the Strait of Hormuz. Brent crude jumped 7% in the aftermath of the attack, deepening market volatility.

    Interest rate hikes work to curb inflation by raising borrowing costs for consumer and business purchases, cooling overall demand and easing upward pressure on prices. Eurozone annual inflation dipped to 2.8% in June, down from 3.2% in May, but policymakers remain wary that sustained high energy prices could spill over into broader price growth across the economy.

  • Aussie brand’s trademark battle with rapper Eminem takes new twist

    Aussie brand’s trademark battle with rapper Eminem takes new twist

    A high-stakes David vs Goliath trademark dispute between global rap icon Eminem and small Australian swimwear label Swim Shady is set to continue, after the hip-hop star filed a last-minute appeal against a recent court ruling that favored the local brand.

    The conflict centers on the similarity between Swim Shady’s brand name and Eminem’s legendary alter ego, Slim Shady, a moniker the rapper has built a decades-long career around. Lawyers representing Eminem, whose legal name is Marshall Mathers, had previously blocked Swim Shady co-founders Jeremy Scott and Elizabeth Afrakoff’s 2024 application to register their brand as a trademark in Australia, arguing the name infringed on the rapper’s existing intellectual property rights.

    Earlier this month, however, Delegate of the Registrar of Trade Mark Benjamin Goldsworthy ruled in Swim Shady’s favor. The decision found that Eminem’s registered trademarks for “Shady” and “Shady Limited” had not been actively used on clothing, footwear, headwear, bags, or leather goods in Australia during the mandatory legal period required to enforce trademark protection. As a result, the court ordered Mathers to cover the small brand’s legal costs stemming from the challenge.

    Scott and Afrakoff, the husband-and-wife team behind the Australian beachwear label, welcomed the initial ruling, calling it a key milestone for their young business. Even at the time, however, the pair acknowledged that the legal fight might not be fully resolved, noting that additional proceedings remained pending after the first ruling.

    True to that expectation, Eminem’s legal team has now launched an appeal. Documents for the appeal were officially submitted to the Federal Court of Australia’s Victoria Registry on Wednesday, right before the July 22 deadline set in the original ruling. The move means the small Australian brand will have to continue defending its trademark against one of the biggest names in the global music industry, extending a legal battle that has drawn international attention to the clash between a giant entertainment corporation and a local small business.

  • Surprise jobs boom spooks ASX as fears of more rate hikes grow

    Surprise jobs boom spooks ASX as fears of more rate hikes grow

    On Thursday, Australia’s benchmark share market closed narrowly in positive territory after a session marked by sharp volatility, driven by surprisingly strong labor market data that stoked fresh fears of additional interest rate increases from the Reserve Bank of Australia (RBA).

    The ASX 200 finished the trading day up 16 points, or 0.18%, at 8,839.00, while the broader All Ordinaries index gained 13.20 points, or 0.15%, to close at 9,018.10. Though both benchmarks ended the day in the green, they surrendered all of their substantial early gains in afternoon trading, after the ASX 200 hit an intraday peak of 8,926.30. Following the release of the jobs report, the Australian dollar climbed against the U.S. dollar to trade at 70.12 U.S. cents by market close.

    The unexpected strength in employment upended market expectations for RBA monetary policy. Official data released Thursday showed Australia’s unemployment rate held steady at 4.4% in June, in line with economist forecasts, but the economy added a staggering 76,300 new roles during the month – far outpacing the consensus prediction of just 15,000 new jobs. The labor force participation rate also rose to 67%, signaling continued tightness in the jobs market that could put upward pressure on wages and inflation.

    Before the data release, money markets priced in a 20% chance of an RBA rate hike at its next policy meeting in August. That probability jumped to 36% immediately after the jobs report, as investors bet that the resilient labor market would give the central bank room to continue tightening to cool persistent inflation. The shift in rate expectations came just one week ahead of the release of June quarter inflation data, a key input for the RBA’s next policy decision. All told, the repricing of hawkish RBA odds wiped roughly 65 points off the ASX 200’s early rally.

    Cameron McCormack, senior portfolio manager at VanEck, noted that the tight labor market has eliminated the headroom the RBA needs to pause its rate hike cycle. “We believe there is at least one more rate hike coming this year, and a considerable chance that we will see two hikes,” McCormack said in comments following the data release.

    Six of the ASX 200’s 11 sectors ended the session in negative territory, with rate-sensitive technology and consumer discretionary stocks posting the largest losses. Accounting software giant Xero dropped 5.01% to close at $64.45, logistics tech firm WiseTech Global slumped 6.97% to $31.48, and family safety platform Life360 fell 5.45% to $24.12. In the consumer discretionary space, retail conglomerate Wesfarmers led declines with a 1.99% drop to $88.11, electronics retailer JB Hi-Fi fell 1.83% to $76.71, and furniture retailer Harvey Norman slipped 0.64% to $4.68.

    These broad losses were offset by strong gains across the mining and materials sector, which kept the benchmark index in positive territory at closing. BHP shares rose 1.46% to $60.63, Rio Tinto added 0.47% to $162.74, and Fortescue Metals gained 1.02% to $18.76. A rally in global gold prices, which climbed to a high of $US4116 per ounce, also lifted gold mining stocks: Northern Star Resources rose 1.92% to $20.74, Evolution Mining jumped 1.85% to $11.57, and Newmont added 0.88% to $136.85.

    In individual company news, Macquarie Group shares slipped 0.46% to $253.75 after the investment bank announced that long-serving chief executive Shemara Wikramanayake would retire from her role in November. Energy firm Origin Energy closed up 0.77% at $10.50 despite revealing that a cyberattack had stolen sensitive customer data, including full names, residential addresses, dates of birth, contact details, account information, and partial payment card and bank account details. Gold and copper producer Sandfire Resources climbed 3.58% to $19.36 after the firm announced record unaudited annual group sales revenue of $574 million.

  • Wall Street poised to open lower as Mideast tensions push Brent crude past $98 a barrel

    Wall Street poised to open lower as Mideast tensions push Brent crude past $98 a barrel

    As global markets kicked off trading on Thursday, Wall Street braced for modest opening losses, pressured by three overlapping forces: escalating Middle East conflict that sent crude oil prices surging, a record antitrust penalty against a major tech giant, and mixed signals from high-profile corporate earnings reports.

    Futures linked to the S&P 500 and the Dow Jones Industrial Average both dropped 0.6% in premarket trading, while Nasdaq futures slid a sharper 0.8%, dragged down by losses in big tech. The steepest early decline belonged to Alphabet Inc., Google’s parent company, which saw its shares tumble 4% immediately after the European Union levied an €890 million ($1 billion) antitrust fine against the firm. EU regulators concluded the tech giant violated digital competition rules by engineering Google Play and its dominant search engine to steer users toward its own native services and apps, effectively shutting out smaller rival competitors. The penalty came just one day after Alphabet reported second-quarter earnings that outperformed Wall Street forecasts, a promising signal that the company’s aggressive, multi-billion-dollar investment push into artificial intelligence may already be delivering returns.

    Another high-profile name saw off-hours share losses: electric vehicle maker Tesla, led by Elon Musk, saw its stock drop 5.6% after the company reported that sharply elevated research and development spending offset strong gains from rising vehicle sales, cutting into bottom-line profits. For weeks, investor focus has centered on whether the massive flood of capital flowing into AI infrastructure—from advanced microprocessors to memory chips and other core components of the AI boom—will translate into sufficient long-term profits to justify current valuations. These ongoing concerns have kept AI stocks at the center of Wall Street’s recent volatility, though the sector saw little early movement on Thursday, with most stocks holding near Wednesday’s closing levels.

    Defense stocks bucked the broader downward premarket trend, however, after two leading aerospace and defense firms posted blowout quarterly results. Lockheed Martin, the world’s largest defense contractor, beat both sales and profit forecasts, sending its shares up 5.5% in premarket trading. RTX, the manufacturer of Patriot air defense systems and Tomahawk cruise missiles, jumped 5.2% after it easily exceeded analyst targets and raised its full-year guidance.

    The most impactful market-moving development on Thursday was the sharp spike in global oil prices, driven by escalating conflict with Iran that has disrupted shipping through the Strait of Hormuz, the world’s most critical energy chokepoint. By early Thursday, Brent crude, the global benchmark for oil, jumped 4.9% to $98.64 per barrel, its highest level since early June. Just earlier this month, Brent had traded below $72 per barrel, roughly matching pre-conflict levels. Currently, about 20% of all globally traded oil and natural gas passes through the narrow strait, and ongoing fighting has blocked many oil tankers from exiting the Persian Gulf. U.S. benchmark West Texas Intermediate crude rose $3.83 to $90.66 per barrel, also hitting a six-week high.

    Rising oil prices create cascading pressure across global markets: they push up operating costs for nearly all businesses, erode corporate profits, and encourage more cautious consumer spending, as households pay more for gasoline and energy. Fuel-reliant industries such as airlines are hit hardest by elevated energy prices, and the sector saw broad losses on Thursday. American Airlines fell 3.7% in premarket trading, even after the carrier reported higher-than-expected profits on record revenue. The company warned that third-quarter fuel expenses would be $1.7 billion higher than the same period a year earlier. The selloff dragged down shares of other major U.S. carriers, including Delta Air Lines and United Airlines. Southwest Airlines also reported strong second-quarter results on Thursday, but its shares dropped more than 4% after the airline cut its third-quarter outlook, citing the same headwind of spiking fuel costs.

    Beyond the United States, European markets traded lower at midday: Germany’s DAX index lost 0.9%, France’s CAC 40 shed 1.3%, and the FTSE 100 in London fell 0.3%. Most Asian markets closed higher on Thursday: South Korea’s Kospi led gains with a 4.4% jump to 7,096.89, Japan’s Nikkei 225 added 0.5% to 66,422.60, with SoftBank Group leading tech-driven gains by climbing 3.8%. Hong Kong’s Hang Seng Index rose 1.3% to 25,210.81, while China’s Shanghai Composite recovered from early losses to close 0.3% higher at 3,876.78. Australia’s S&P/ASX 200 gained 0.2% to 8,839.00, Taiwan’s Taiex edged up 0.1%, and India’s Sensex closed 0.6% lower. In currency markets, the U.S. dollar traded at 163.36 Japanese yen, with the yen hovering near its weakest level in four decades. Expectations that the gap between U.S. and Japanese interest rates will widen, driven by faster inflation in the U.S., have continued to push the dollar higher against the Japanese currency.

    Economists and investors warn that the latest spike in oil prices threatens to reaccelerate global inflation, which could force the U.S. Federal Reserve and other major central banks to keep interest rates higher for longer. Higher borrowing rates slow overall economic growth and typically put downward pressure on valuations for stocks and other risk assets.

  • From Syria to UAE, the race to bypass Strait of Hormuz is on

    From Syria to UAE, the race to bypass Strait of Hormuz is on

    Against a backdrop of escalating geopolitical rivalry over control of the Strait of Hormuz, the world’s most critical energy chokepoint, the Middle East is embarking on an unprecedented wave of pipeline construction stretching from the Mediterranean coast to the Red Sea and Gulf of Oman. Arab oil-producing nations are racing to build alternative export routes to avoid reliance on the waterway, where Iran has been pushing to assert dominance over global energy supplies.

    Industry analysts project that tens of billions of dollars will be invested in these bypass infrastructure projects over the coming years. While the region has a history of ambitious large-scale energy projects that failed to move forward, energy experts emphasize that the political and economic commitments to reconfigure regional oil flows are genuine this time. “When we speak to our customers in the region, they say they never want to deal with this [Hormuz-related risk] again,” Artem Abramov, deputy head of analysis at Rystad Energy, told Middle East Eye. “These bypass projects will move forward.”

    The United Arab Emirates (UAE) is leading the expansion, currently constructing a second pipeline to the Gulf of Oman port of Fujairah—located outside the Strait of Hormuz— that will double the country’s bypass export capacity by 2027, reaching 3.6 million barrels per day (bpd). Last month, a senior executive from the Abu Dhabi National Oil Company revealed that the state energy producer is also considering a third pipeline to carry refined petroleum products including jet fuel, gasoline and diesel to Fujairah. The country’s crude oil output hit an all-time record high of 4.1 million bpd in June, with existing capacity already allowing it to maintain steady exports through both Hormuz transits and the existing Fujairah pipeline.

    Meanwhile, Iraq, OPEC’s second-largest producer, signed a landmark agreement with Syria in July to rehabilitate an aged pipeline linking its northern oil fields to Syria’s Mediterranean port of Baniyas. A consortium led by U.S. energy major Chevron, Los Angeles-based TI Capital, and the Syrian-Qatari al-Khayyat billionaire brothers is spearheading the rehabilitation project. If completed, most of the Iraqi crude moving through this new route will likely be sold to European markets, as very large crude carriers (VLCCs) too large to transit the Suez Canal make long-haul shipments to Asia economically unviable, according to analysts.

    Saudi Arabia’s decades-old East-West Pipeline, which runs from the Gulf coast’s Abqaiq oil field to the Red Sea port of Yanbu, has become the regional model for Hormuz bypass infrastructure. Originally built in the 1980s and expanded multiple times since, the pipeline currently carries around 4 million bpd of crude for export, with an additional 2 million bpd supplied to domestic refineries on Saudi Arabia’s west coast. Riyadh is now actively pursuing capacity expansion, with reports indicating it aims to add 2 million bpd of export capacity, a project that will likely require constructing a parallel pipeline and upgrading port facilities at Yanbu to accommodate more VLCCs simultaneously. Despite lower export volumes in early 2024, Saudi oil revenue hit a three-year high in March on the back of elevated global prices.

    This large-scale reconfiguration of regional oil flows is already creating clear winners and losers, reshaping the geopolitical and economic balance of power across the Gulf. Geopolitical and energy analysts note that Saudi Arabia and the UAE have emerged as the primary beneficiaries, cementing their positions as the region’s most influential power brokers and most reliable energy suppliers. In contrast, the geographic vulnerabilities of smaller Gulf states including Kuwait and Bahrain have been laid bare by the ongoing tensions.

    “UAE and Saudi will realise the biggest windfalls from this. Kuwait and Bahrain are the biggest losers,” explained Gregory Brew, senior Iran and energy analyst at Eurasia Group. Kuwait, which depends on the Strait of Hormuz for nearly 100 percent of its oil exports due to its location at the northern tip of the Persian Gulf, has already opened discussions with Saudi Arabia and the UAE to access their bypass pipeline networks. Bahrain, an island kingdom connected to the outside world only by a causeway to Saudi Arabia, faces similar constraints. “Kuwait and Bahrain will require transit agreements and potentially revenue-sharing deals with Saudi Arabia and the UAE,” Brew noted, adding that this arrangement will significantly increase Riyadh and Abu Dhabi’s regional leverage.

    Qatar, the world’s leading liquefied natural gas exporter, is expected to remain almost entirely dependent on the Strait of Hormuz for its exports, analysts predict. The geographic reality of each country’s position dictates the economic benefits and drawbacks of the new pipeline network: while Saudi Arabia and the UAE can maintain access to key Asian markets via their Red Sea and Gulf of Oman ports, Iraq’s new Mediterranean route locks it into primarily serving European markets at the cost of easier access to high-demand Asian economies. “Iraq wants to tap the Asian market. But with this pipeline they would be sending crude to Europe. The ability to generate considerable revenues from that market is constrained,” Brew added.

    Despite the momentum behind the pipeline boom, experts warn that the alternative routes do not eliminate strategic risk. Greg Priddy, energy expert at the Center for the National Interest, points out that all new bypass infrastructure remains within range of Iranian missiles and drones, mirroring how Ukraine has been able to disrupt Russian energy infrastructure with long-range attacks. “The caveat to all these bypasses is that they are still vulnerable to Iranian missiles and drones. The balance in warfare has swung decidedly to offence, away from defence, making it hard to protect these assets,” Priddy said. “Fujairah is a great example. It is close enough to Iran that they can hit anything there with accuracy.”

    The vulnerability of bypass routes was recently underscored by Houthi forces in Yemen, which are backed by Iran. The group recently declared an embargo on Saudi shipping in the Red Sea, forcing at least eight commercial tankers to reverse course to avoid potential attacks on transits through the Bab el-Mandeb Strait.

    Escalating tensions around the Strait of Hormuz have intensified after Iran attacked commercial vessels belonging to Saudi Arabia, the UAE, Qatar, Kuwait, Bahrain and Jordan transiting the waterway earlier this month, breaking a recent ceasefire with the U.S. that included a critical sanctions waiver. Some Western diplomats and analysts now argue Iran may have overextended its efforts to assert control over the chokepoint, requiring further escalation to maintain its influence. “Iran might have overplayed its hand in the Strait of Hormuz. It will need to escalate in new ways to impose itself,” one anonymous Western diplomat familiar with Yemen affairs told Middle East Eye.

    Energy analysts agree that the push for bypass infrastructure is a durable long-term trend, with funding secured from regional sovereign wealth funds and global infrastructure investors. “These pipelines are expensive and geopolitically complicated, but the Gulf states will spend serious money for back-up options,” said Ben Cahill, senior fellow at Washington-based think tank the Atlantic Council. “This is a durable trend. There will be backing from sovereign wealth funds and probably infrastructure investors.” As Priddy put it: “What used to look like a $5 or $10bn extraneous bet now looks necessary.”

  • EU clears $110bn Paramount and Warner Bros merger, but it remains on hold in US

    EU clears $110bn Paramount and Warner Bros merger, but it remains on hold in US

    One of the largest media mergers in recent history has passed a critical European regulatory hurdle, but the $110 billion combination of Paramount Skydance and Warner Bros Discovery remains entangled in legal and political pushback in the United States, putting the entire deal at risk of costly delays. The European Commission, the European Union’s top competition watchdog, announced last week that it had approved the transaction after Paramount agreed to sweeping concessions to address anti-competition concerns. To satisfy regulators, Paramount committed to terminating its long-standing film distribution partnership with rival studio Universal Pictures across the European Economic Area within 13 months, and is barred from entering any similar joint distribution arrangement for a 10-year period. Regulators had raised alarms that the existing partnership, combined with the scale of the merged media giant, would create an unrivaled hold over European cinema release scheduling and distribution, reducing competition and limiting options for audiences and theater operators. While the EU green light marks a major milestone for the deal, it only resolves one of multiple global regulatory and legal challenges. In the United States, the merger is currently on ice after a coalition of 12 state attorneys general filed a lawsuit last week to block the transaction entirely. Though the U.S. Department of Justice signaled its support for the merger back in June, the states’ lawsuit argues that the combined company would wield excessive market power that would inflict widespread damage on independent movie theaters, domestic basic cable providers, and ultimately consumers across the country. Just days after the lawsuit was filed, U.S. District Judge Araceli Martínez-Olguín granted a temporary restraining order to pause the takeover, allowing time for the court to review the states’ legal claims. Alon Kapen, a corporate transaction attorney at New York-based law firm Farrell Fritz, noted that the temporary pause is not a final ruling on the case, but it indicates the court takes the states’ arguments about harm to the theatrical exhibition market seriously. Beyond the immediate legal standoff, delays come with steep financial consequences for Paramount. The merger agreement includes a provision that requires Paramount to pay a so-called “ticking fee” of approximately $7 million per day to Warner Bros Discovery shareholders if the transaction is not finalized by the September 30 deadline. This penalty structure means even a two-week delay would add $98 million to Paramount’s acquisition costs, while a multi-month delay could run into hundreds of millions of dollars in additional expenses. The merger also faces fierce opposition from organized labor in Hollywood: the Writers Guild of America (WGA), the union representing film and television writers in the U.S., has come out strongly against the deal, warning it will lead to widespread job cuts and suppress writer wages. In an official statement released after the states filed their lawsuit, WGA president Tom Fontana argued that the merged company would hold unprecedented bargaining power over creative talent, allowing it to push down compensation and cut back opportunities for new and emerging writers. On top of the U.S. legal challenge, regulators in the United Kingdom are still conducting their own independent review of the merger. UK watchdogs have raised specific concerns about the impact on domestic news programming, children’s content, and competition in the global streaming market, and have not ruled out launching their own intervention to block or modify the deal. For its part, Paramount has defended the merger consistently, arguing that the combination of the two studios will ultimately deliver greater value to audiences. The company has pledged that the merged entity will release at least 30 new feature films to cinemas globally every year, double the number of theatrical releases Paramount currently produces annually, a commitment it says will boost the global film exhibition industry and give audiences more high-quality theatrical content.