Markets rally as Trump signals progress with Iran

0:00This BBC podcast is supported by ads outside the UK. What was the point of the Artemis 2 mission round the moon? I'm Tristan Redmond, host of the Global Story Podcast. The Artemis crew are back on solid ground after traveling further from Earth than any human has before. The mission was a success. Or was it? Aside from getting great picks for socials, did we learn anything? For more, listen to the Global Story on BBC.com or wherever you listen. Stocks rebound and the oil priced plunges on hopes of an end to the Middle East war. Its world business express from the BBC World Service, I'm Gideon Long. Donald Trump says the US has been talking to the Iranians and suggests the conflict might be over soon, although the Iranians deny there's been any dialogue. We'll bring you the economic reaction to the President's comments.

1:01And we'll look at Hule, the British milkshake-like drink that's marketed as a replacement for food, a company that makes it as a new owner. But we're starting with the Middle East because Donald Trump has said the Americans have had productive conversations with the Iranians about reaching what he described as a complete and total resolution to the conflict in the Middle East. He said he's ordered the US military to postpone strikes against Iranian energy infrastructure for at least five days. Let's hear what he had to say just a couple of hours ago. We have a very serious chance of making a deal. That doesn't guarantee anything. I'm not guaranteeing anything. I'm not going to come out here in a week or two weeks, and you all say, oh, you said, I didn't say anything. All I'm saying is, we are in the throes of a real possibility of making a deal. And I think if I were betting, man, I'd bet for it. But again, I'm not guaranteeing anything. Well, his comments had a big and instant impact on financial markets,

2:02with us to talk through it all is Rachel Winter, partner and investment manager at Killican Co. And Rachel, let's start with the oil price. Unsurprisingly, it dropped. Tell us by how much. Yeah, it's been a big move, say. This morning oil was trading at over $114 per barrel. It's dropped over 11%. So it's now just under $100 per barrel. So great to see such a drop downwards. That should be good news for inflation. But do bear in mind, it was only $60 per barrel at the end of last year. So it's still up over 50% since then. And stocks and bonds, how do they react positively? So the S&P 500 was up 2% when the market opened this afternoon to that's definitely good news. And then looking at bonds, we have seen a small rise in those prices. And that implies that investors are no longer so worried about inflation, because generally when people are worried about inflation, they don't buy bonds. So it's good to see a rise in those bond prices this afternoon. And briefly, how about gold, that classic safe haven in times of conflict? That's come down. That's done about 3% this afternoon. So as you say, investors do view this

3:06as a safe haven. And the fact that it's come down shows they are feeling a bit more comfortable and therefore less inclined to invest in a safe haven investment. We should add one note, of course, and though the war is not yet over, and Iran has denied any dialogue with the United States. The foreign ministry in Tehran accused Trump of trying to reduce global energy prices to gain time for his military plans. And Iran's Tasnim news agency has quoted an Iranian official as saying the Straits of Hormuz is not about to return to pre-war conditions and that energy markets will remain unsettled. We shall see. Rachel, stay with us. Well, one of the countries that would really benefit from an end to the conflict in the Middle East is the Philippines. It imports 98% of its fuel from the Persian Gulf, and the war has driven up prices, so much so that the government's implemented a four-day working week to reduce energy demand. The BBC's Surinjana Tawari is in the capital, Manila. We've been here just over 24 hours now, and you know, there are cues outside petrol pumps. There's even sort of paper over signs because there's been so many price hikes in the last

4:09week or so. There were also protests against the government's handling of the situation. Now, the government's introduced a number of measures to try and offset the higher price of oil and the disruption to supply. For example, it's implemented a four-day working week for office workers. It's even asked government workers to use the stairs instead of lifts. But we're seeing especially for jeep knee drivers. Jeep knees are those colorful open buses with seats on either side of the interior. Now, they rely on diesel. The price of diesel has gone up by 50% already, since the war broke out. We spoke to one jeep knee driver and also a restaurant owner who's facing higher oil prices because, you know, food needs to come from the farmland into the city, and here's what they had to say. The fuel price hikes have really hit me hard. The government should help by allowing us to raise fares because the subsidy we receive isn't

5:12enough. The price of rice has risen by more than 50% and cooking gas is up by more than a third. I can't raise my prices because that would mean losing even more customers. So, two voices from Manila there. It sounds pretty noisy where you are, Sir and John, are you expecting further protests against these government measures? Yeah, I'm actually a really busy intersection in central Manila, and we are expecting another protest. Now, this time it's not just transportation workers as it was last week. It's also ordinary workers and school children as well because those jeep knees that I was talking about, they're used for commuting all around the city for kids getting to school, for people getting to work, and in the rural areas, we're hearing that those jeep knees just aren't running anymore, and that's causing problems for kids getting to school. So, you can really see how this is filtering down to all sectors of the economy.

6:13And remember, the Philippines is an emerging economy. It's no longer developing. It's an emerging economy, but it still doesn't have the resources. It doesn't even have the storage capacity to take on more oil. And even though the International Energy Agency, for example, has said just today because of the impact on Asia, it's going to talk to suppliers to try and increase those supplies. It's going to take time for those to come through. It takes days to actually release supplies, and then these types of countries, not just the Philippines, but also others in the region, Vietnam, Thailand, Laos, they don't have the storage facility. Sir and John are Tawari in the Philippines. Well, speaking before Donald Trump's comments today, the head of the International Energy Agency, Fatty Birol, gave a bleak assessment of the energy crisis caused by the conflict in the Middle East. He said it was more severe than the oil shocks of the 1970s and the impact of the Russia-Ukraine war combined. Here's what he had to say. It is not only oil and gas, fertilizers, petrochemicals. These are all facing major problems.

7:16So I believe the world has not yet understood the depth of the energy security challenge we are facing. Fatty Birol from the IEA. Well, the war has had consequences across the world. Of course, many countries in Africa have been scrambling to try and secure fuel supplies. Today, officials at a major refinery in Nigeria, the Dangote refinery, have said they've exported nearly half a million tons of fuel to five African countries because of disruption in the state of Hormuz. It says it sent 12 cargoes in total to Ivory Coast, Cameroon, Tanzania, Ghana and Togo. To South Korea now, because the countries have pointed a new head of its central bank, and he's a man who comes with a track record. Shin Hyeon-sung is best known for predicting the global financial crisis in 2008. In an opening statement, after getting the job, Mr. Shin warned about volatility in financial markets heightened by the situation in the Middle East.

8:21Now, what do you get if you cross the words human with fuel? The answer is fuel, H-U-E-L, a British company that makes milkshake-style drinks, which it markets as meal replacements. They're full of supplements and vitamins. The company's been backed by celebrity investors, including the actor Idris Elba, and today, the big French consumer goods group, Danone, said it's buying fuel for over a billion dollars. Rachel Winter is still with me. Rachel, he's been doing pretty well, hasn't it? And this is part due to the whole weight loss phenomenon, weight drugs lost phenomenon. People trying to live healthier lifestyles and eat less, yes exactly, so fuel was worth about 560 million dollars back in 2022, so it's nearly doubled in value if you consider it's just been sold for over a billion. It is often reported that people taking these GLP1 weight loss drugs are craving so-called nutrient dense food, and he will definitely fix that category. So with that in mind, it's not surprising to see the company doing well. Rachel Winter at Killig and Co. Thanks for joining us, and that's it from this edition of World

9:24Business Express. Thanks for listening. What was the point of the Artemis 2 mission round the moon? I'm Tristan Redmond, host of the Global Story podcast. The Artemis crew are back on solid ground after traveling further from Earth than any human has before. The mission was a success. Or was it? Aside from getting great picks for socials, did we learn anything? For more, listen to the Global Story on BBC.com or wherever you listen.