Iran is preparing to supply Russia with hundreds of drones and other unmanned aerial vehicles to support Vladimir Putin’s invasion of Ukraine, the White House said yesterday, as Joe Biden prepares to embark on his first trip to the Middle East as president.
Jake Sullivan, Biden’s national security adviser, told reporters the US had information indicating Tehran was “preparing to provide Russia with up to several hundred UAVs . . . on an expedited timeline”.
He added that the shipment would include drones that could be used as weapons and that Iran was preparing to train Russian forces to use the UAVs and that the training sessions would begin “as soon as early July”.
Biden departs Washington tomorrow for Israel and the West Bank and Iran is likely to be one of the issues discussed. He will subsequently travel to Saudi Arabia, where he is expected to push for the world’s biggest crude producer to increase production to help bring down global energy prices that have soared during the war in Ukraine.
The Kremlin said today that Russian president Vladimir Putin will visit Iran next week in the wake of Biden’s trip to the region.
The fallout from the war in Ukraine has created an opening to put relations between Washington and the world’s biggest crude producer back on track, officials and analysts in the US and the Gulf say.
Before his election in 2020, Biden had promised to reassess relations with the Gulf state. Relations between the US and Saudi Arabia reached a historic low in the wake of the killing of journalist Jamal Khashoggi in 2018.
Biden will attend a summit of Arab leaders and meet Saudi Arabia’s de facto leader Crown Prince Mohammed bin Salman in Jeddah at the weekend.
In a pre-emptive defence of his visit, Biden wrote in the Washington Post at the weekend that “from the start, my aim was to reorient — but not rupture — relations with a country that’s been a strategic partner for 80 years”.
Preview Joe Biden seeks reset on Saudi Arabia as oil tensions flare
Do you think Biden should be travelling to Saudi Arabia for talks with Prince Mohammed? Email me at firstft@ft.com or hit reply to this email. Here is the rest of the day’s news — Gordon
Five more stories in the news
1. US and Japan to tackle exchange volatility The US and Japan have agreed to “co-operate as appropriate” to address the falling value of the yen against the dollar after a meeting between US Treasury secretary Janet Yellen and her Japanese counterpart Shunichi Suzuki. The dollar extended its recent rise today as fears of a global recession and aggressive interest rate rises by the Federal Reserve push investors into the US currency.
2. BYD shares tumble Shares in Chinese electric carmaker BYD fell 12 per cent after a stake close to the size of Berkshire Hathaway’s appeared in the Hong Kong stock exchange clearing system. Berkshire told investors in February that it owned a 7.7 per cent stake in the company, valued at $7.7bn. Last week BYD overtook Tesla to become the world’s biggest electric vehicle producer by sales.
3. Twitter calls Musk bid to scuttle deal ‘invalid and wrongful’ The social media company has hit back at Elon Musk’s attempt to walk away from his $44bn acquisition of the platform, accusing him of breaching the merger agreement, according to a letter sent to the billionaire’s lawyers.
4. Klarna’s valuation crashes Once Europe’s most valuable private tech company, Klarna has had its price tag slashed from $46bn to $6.7bn at its latest fundraising that highlights the crash in many valuations. Premium subscribers can click here to receive our FintechFT newsletter.
5. Global population growth hits lowest rate since 1950 The global population grew by less than 1 per cent a year for the first time since the aftermath of the second world war in 2020 and 2021, according to the UN. Despite the slowing growth, the global population is still poised this year to reach the milestone of 8bn people, with India next year projected to surpass China as the most populous country.
The day ahead
January 6 Committee Domestic far-right extremism and its connection to Donald Trump will be the focus of today’s hearings. The bipartisan committee investigating last year’s storming of the Capitol building will argue the former president played a “pivotal” role in spurring groups like the Proud Boys to attack Congress in an attempt to overturn the result of the 2020 election.
Company earnings PepsiCo, the consumer goods group, is expected to report revenues increased 1.54 per cent to $19.5bn in its second fiscal quarter, according to analysts polled by Refinitiv. The company previously boosted its sales outlook for its most recent quarter but warned in April that a strong dollar would result in a higher currency translation “headwind” and weigh on its results.
Amazon’s Prime Day The two-day event, which runs today and tomorrow, is forecast to generate global sales of more than $12.5bn, up 17 per cent on last year, according to research group Insider Intelligence.
Conservative party leadership race Former chancellor Rishi Sunak will launch his campaign to be the next leader of the Conservative party and British prime minister. Under the rules of the contest, all nominations must be submitted by the end of today and voting will begin on Wednesday. A winner is expected to be announced on September 5.
Croatia closer to the euro Ministers from 27 European Union member states are due to pass the final three legal acts required for the country to become the 20th member to take on the currency.
Nasa scientific observations The US space agency and its partner, the European Space Agency, release four scientific observations from the $10bn James Webb Space Telescope. They come hot on the heels of the first image of infant galaxies formed 13bn years ago, which was unveiled last night.
What else we’re reading
Lipsticks, lattes and labradors: JAB’s bet on pets After spending more than $50bn on coffee chains, restaurants and cosmetic companies, the European group has found a cute solution to boosting its mixed returns: pets. But its investments in vets and insurance are under scrutiny from competition officials.
The Supreme Court has weakened legal predictability in America One thing that the US has always had going for it has been the rule of law. A radical shift at the Supreme Court, which has overturned nearly 50 years of abortion rights, has now thrown the consistency of the legal system into question, writes our editorial board.
Executives seek briefings on Taiwan war risk Company executives are increasingly concerned about the possibility of war over Taiwan, according to consultants who have seen a sharp rise in demand for briefings following the invasion of Ukraine.
America’s new agricultural frontier After years of laboratory testing, companies are now racing to scale up their operations for the commercial production of plants, and hoping to beat competitors to a dominant share of what could be a vast market.
Abe killing shines spotlight on links with Moonies Close ties between the Moonies and powerful figures in the governing Liberal Democratic party have long been an open but little-discussed secret in Japan. Shinzo Abe’s killing and the suspect’s alleged family links with the group have shone a spotlight on the relationship, as the nation seeks answers to one of its worst incidents of political violence since the second world war.
Film
The Russo brothers, two of the highest-earning film-makers in history, talk to our Los Angeles correspondent about the unusual release of their new action thriller The Gray Man after a record-breaking run at Marvel.
Source: Economy - ft.com
