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    White House Faces Risk of Economic Fallout From Iran Strike

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    President Trump, aware of how high gas prices could affect his popularity, demanded on social media that the U.S. “KEEP OIL PRICES DOWN.”President Trump on Monday began to confront the potential economic blowback from his military strikes on Iran, which threatened to send oil and gas prices soaring at a moment when U.S. consumers are already facing significant financial strains.The mere prospect of rising energy costs appeared to spook even Mr. Trump, who took to social media to push for more domestic drilling while demanding that companies “KEEP OIL PRICES DOWN”; otherwise, they would be “PLAYING RIGHT INTO THE HANDS OF THE ENEMY.”“I’M WATCHING!” the president added.By midday Monday, global oil markets appeared relatively muted, two days after Mr. Trump dispatched U.S. bombers on a mission to disable three Iranian nuclear sites. Prices rose over the weekend before ultimately settling, as Washington — and the rest of the world — braced for the possibility that Tehran may still retaliate.In one worst-case scenario, Iranian leaders could look to shutter or otherwise impede access to the Strait of Hormuz, the narrow waterway that serves as the critical entrance point to the Persian Gulf. The world ships substantial amounts of oil and liquefied natural gas through the passage, so any interruption to commerce could cause energy prices to surge globally.A spike in energy costs could prove especially difficult for American consumers and businesses this summer, given that it could arrive at about the same time that Mr. Trump plans to revive his expansive, steep tariffs on nearly every U.S. trading partner. Many economists expect those levies to push up prices after years of high inflation.In April, the president announced, then suspended, those sky-high duties, seeking to quell a global market meltdown over his disruptive and legally contested campaign to remake global trade. But Mr. Trump has not wavered in his plan to implement the tariffs on July 9, and many economists expect companies — which pay the duties when they source foreign products — to pass the added costs down to their customers.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    No Sting, No Mercedes: A Russian Expo Shows Cost of Divorce With the West

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    The annual economic forum in St. Petersburg used to host multibillion-dollar deals and performances by global music stars. With the war in Ukraine still raging, the mood has shifted.During his early years in the Kremlin, President Vladimir V. Putin used the annual economic conference in St. Petersburg as a marquee event to showcase how Russia was becoming a magnet for Western businesses.Multibillion-dollar oil and gas deals were signed, including the agreement to build the Nord Stream 2 pipeline between Russia and Germany. Western corporate giants such as BP, Chevron, Deutsche Bank and Total sent their chief executives. In 2018, President Emmanuel Macron of France was the guest of honor. In 2011, Sting performed in front of the Winter Palace.But the event, which opened on Wednesday and will run through Saturday, now reflects a Russia fundamentally transformed by Mr. Putin’s invasion of Ukraine in 2022.The Kingdom of Bahrain was the guest of honor, and the Chinese brand Tank, not Mercedes, was selected as the official car. Instead of executives from Morgan Stanley and Citibank, a delegation of the Taliban roamed the giant exhibition center. And only second-tier Russian pop and rock stars were on show, with no international acts appearing at all.Tank, a Chinese automobile manufacturer, was chosen as the carmaker for the conference. In prior years, it was Mercedes.Dmitri Lovetsky/Associated PressThe conference’s message is that Russia will never again be so reliant on business with the West.Despite newly opened lines of communication between Mr. Putin and President Trump, major American investors once again shunned the conference. The Russia-United States session, billed as dedicated to “identifying shared interests and shaping long-term partnerships,” was open by invitation only.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

  • 138 Shares109 Views

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    As Trump Returns to G7, Rift With Allies Is Even Deeper

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    In 2018, the president called for the group to embrace Russia and stormed out of the summit. Now he is seeking to shrink America’s military role abroad and embarking on a more expansive trade war.When President Trump last attended a Group of 7 meeting in Canada, he was in many ways the odd man out.At that meeting, in 2018, Mr. Trump called for the alliance of Western countries to embrace Russia, antagonized allies and ultimately stormed out of the summit over a trade battle he began by imposing metals tariffs on Canada.As he returns on Sunday for the Group of 7 meeting in Alberta, those fissures have only deepened. Since retaking office, the president has sought to shrink America’s military role abroad and made threats to annex the summit’s host after embarking on a much more expansive trade war.Mr. Trump is now facing a self-imposed deadline of early July to reach trade deals. His trade adviser even promised in April that the tariffs would lead to “90 deals in 90 days.” Despite reaching framework agreements with Britain and China, the administration has shown scant progress on deals with other major trading partners.The future of the president’s favored negotiating tool is uncertain as a legal battle over his tariffs plays out in the courts. But a failure to reach accords could lead the Trump administration to once again ratchet up tariffs and send markets roiling.“I think we’ll have a few new trade deals,” Mr. Trump told reporters at the White House on Sunday as he left for the summit.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    Where’s the Inflation From Tariffs? Just Wait, Economists Say.

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    Are predictions for a jump in consumer prices too early, or just wrong?Tariffs raise consumer prices. It’s a view held by most economists since long before President Trump entered the White House.Prices rose when Mr. Trump imposed levies on China in his first term, though that did not translate to noticeably higher inflation overall. Forecasters have been bracing for months for it to happen again on a much larger scale, given that his tariffs this time are substantially larger and more widespread.But data released this week showed that inflationary pressures remained more muted than expected at this stage, raising an uncomfortable question for economists: Are their predictions wrong?Economists are undeterred — for now. It’s not that tariffs aren’t affecting prices, they say. It’s that this isn’t happening in a significant enough way just yet to show up in broad measures of inflation like the Consumer Price Index. They argue that the impact will be much more significant this summer.“Inflation is very likely going to increase,” said Marc Giannoni, chief U.S. economist at Barclays, who formerly worked at the Federal Reserve’s regional banks in Dallas and New York. “It is a question of time, not so much of if.”Mr. Trump’s tariffs have already rippled through the economy in several ways.Businesses rushed to stock up on products before levies were imposed, and now imports of foreign goods are down sharply. Uncertainty has skyrocketed, stoked by the administration’s frequent pivots on its trade policy. On Thursday, it announced that steel tariffs would soon apply to appliances made with the metal, including dishwashers, washing machines and refrigerators. More

  • 138 Shares189 Views

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    New China Trade ‘Deal’ Takes U.S. Back to Where It Started

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    If a handshake agreement holds, it will merely undo some of the damage from the trade war that President Trump started.After two days of tense negotiations, the United States and China appear to have walked back from the brink of a devastating economic conflict — maybe.Officials from the two countries reached a handshake agreement in the early hours of Wednesday in London to remove some of the harmful measures they had used to target each other’s economies as part of a clash that rapidly intensified in recent months.It remains unclear whether the truce will hold — or crumble like one struck in May did. Even if the agreement does prove durable, its big accomplishment appears to be merely returning the countries to a status quo from several months ago, before President Trump provoked tensions with China in early April by ramping up tariffs on goods it produces.“It seems like we’re negotiating in circles,” said Myron Brilliant, a senior counselor at DGA-Albright Stonebridge Group and former executive vice president of the U.S. Chamber of Commerce.“You escalate, you de-escalate,” he added. “At the end of the day we’re not really further along.”As a result of this week’s negotiations, tariffs will stay where they are. Further details are scant, other than the likely rollback of aggressive policies the two countries adopted since May.China is expected to loosen restrictions on exports of minerals that had threatened to cripple an array of American manufacturers. The United States will in return relax new limits that it placed on its own exports of technology and products, as well as walk back threats to cancel visas for Chinese students in the United States.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    U.S. Court Agrees to Keep Trump Tariffs Intact as Appeal Gets Underway

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    The appeals court’s decision delivered an important but interim victory for the Trump administration.A federal appeals court agreed on Tuesday to allow President Trump to maintain many of his tariffs on China and other U.S. trading partners, extending a pause granted shortly after another panel of judges ruled in late May that the import taxes were illegal.The decision, from the U.S. Court of Appeals for the Federal Circuit in Washington, delivered an important but interim victory for the Trump administration, which had warned that any interruption to its steep duties could undercut the president in talks around the world.But the government still must convince the judges that the president appropriately used a set of emergency powers when he put in place the centerpiece of his economic agenda earlier this year. The Trump administration has already signaled it is willing to fight that battle as far as the Supreme Court.The ruling came shortly after negotiators from the United States and China agreed to a framework intended to extend a trade truce between the two superpowers. The Trump administration had warned that those talks and others would have been jeopardized if the appeals court had not granted a fuller stay while arguments proceeded.At the heart of the legal wrangling is Mr. Trump’s novel interpretation of a 1970s law that he used to wage a global trade war on an expansive scale. No president before him had ever used the International Emergency Economic Powers Act, or IEEPA, to impose tariffs, and the word itself is not even mentioned in the statute.But the law has formed the foundation of Mr. Trump’s campaign to reorient the global economic order. He has invoked its powers to sidestep Congress and impose huge taxes on most global imports, with the goal of raising revenue, bolstering domestic manufacturing and brokering more favorable trade deals with other countries.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

  • 113 Shares159 Views

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    U.S. and China Agree to Walk Back Trade Tensions

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    Negotiators said the two governments would stick to a previous truce and reduce tensions that had escalated in recent weeks between the world’s largest economies.The United States and China have agreed to a “framework” that is intended to ease economic tension and extend a trade truce that the world’s two largest economies reached last month, officials from both countries said on Tuesday.After two days of marathon negotiations in London, top economic officials from the United States and China are now expected to present the new framework to their leaders, President Trump and President Xi Jinping, for final approval.The agreement is intended to solidify terms of a deal that the United States and China reached in Switzerland in May that unraveled in recent weeks. Commerce Secretary Howard Lutnick, who was part of the negotiating team, said American concerns over China’s restrictions on exports of rare earth minerals and magnets had been resolved.“We have reached a framework to implement the Geneva consensus,” Mr. Lutnick told reporters in London, describing the agreement as a “handshake.”He added that Mr. Trump and Mr. Xi would be briefed on the agreement before it took effect.“They were focused on trying to deliver on what President Xi told President Trump,” Mr. Lutnick said. “I think both sides had extra impetus to get things done.”The U.S. trade representative, Jamieson Greer, who took part in the discussions, said they were also focused on ensuring compliance with what was agreed to in Geneva about rare earth mineral exports and tariffs. He said the two sides would remain in regular contact as they tried to work through their economic disagreements.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    Trump Aides Urge Court to Spare Tariffs as They Dismiss Worries in Public

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    The dueling narratives come as the administration is asking an appeals court to preserve a set of tariffs recently deemed to be illegal.Shortly after a federal trade court declared many of President Trump’s tariffs to be illegal, Howard Lutnick, the commerce secretary, took to television to brush aside the setback.“It cost us a week, maybe,” Mr. Lutnick said this month on Fox News, noting that other countries remained eager to strike new deals despite tariffs being in legal jeopardy.“Everybody came right back to the table,” he added.With the fate of the president’s tariffs hanging in the balance, the Trump administration has tried to project dueling narratives. Top aides have insisted publicly that their negotiations remain unharmed, even as some of those same officials have pleaded with the court to spare Mr. Trump from reputational damage on the global stage.The administration will face two crucial tests on Monday. The government is scheduled to submit a new legal brief to a federal appeals court outlining why the tariffs should not go away, while Mr. Lutnick and other close Trump advisers meet with their Chinese counterparts in London to hammer out new trade terms.The court could factor in “any sort of public statements the administration makes” as it decides whether to preserve existing tariffs as the case plays out, said Ted Murphy, a co-leader of the trade practice at the law firm Sidley Austin.While Mr. Murphy said it remained to be seen how judges would view the government’s recent bullishness, he said that a decision that invalidated the president’s tariffs could “weaken the U.S. position” abroad.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More