US strikes at a fragile moment for global economy
New York:
US strikes on Iran
's three main nuclear facilities come at a fragile moment for the
global economy
, and the outlook now hinges on how forcefully the Islamic Republic retaliates.
The World Bank, the Organization for Economic Cooperation and Development and the
International Monetary Fund
have all downgraded their global growth forecasts in recent months. Any significant increases in oil or natural gas prices, or disturbances in trade caused by a further escalation of the conflict, would act as yet another brake on the world economy.
"We'll see how Tehran responds, but the attack likely puts the conflict on a escalatory path," Bloomberg Economics analysts including Ziad Daoud wrote in a report. "For the global economy, an expanding conflict adds to the risk of higher
oil prices
and an upward impulse to inflation.?"
The rising geopolitical risks intersect with a potential escalation in tariffs in the coming weeks as President Donald Trump's pauses of his hefty so-called "reciprocal" levies are due to expire. The biggest economic impact from a prolonged conflict in the Middle East would likely be felt via surging oil prices.
Post the US strike, a derivative product that allows investors to speculate on price swings in crude oil surged 8.8% on IG Weekend Markets. If that move were to hold when trading resumes, IG strategist Tony Sycamore said he projects WTI crude oil futures will open at around $80 per barrel.
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Time of India
21 minutes ago
- Time of India
Asian shares rally, oil prices tumble as Trump announces Iran-Israel ceasefire
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Hindustan Times
2 hours ago
- Hindustan Times
US strikes on Iran add to global travel disruptions and flight cancellations
The US entry into Israel's war with Iran has caused travel disruptions to pile up globally. Israelis disembark a bus after they were flown back to Israel in a special flight, on June 16, 2025, in Tel Aviv.(AFP) Following unprecedented bombings ordered by President Donald Trump on three Iranian nuclear and military sites over the weekend, Iran on Monday launched a missile attack on US forces at Qatar's Al Udeid Air Base. Qatar had closed its airspace just hours earlier, after both the U.S. and U.K. also urged their citizens to shelter in place there. The region has been on edge following the weekend strikes from the US — and since Israel began the war with a surprise bombardment on Iran, which has responded with its own missile and drone strikes, earlier this month. As deadly attacks escalated between Israel and Iran over recent weeks, sections of airspace and airports throughout the region have temporarily closed. And airlines cancelled more flights in recent days, with some halting select routes through the middle of the week — particularly in Qatar and the United Arab Emirates, just across the Persian Gulf from Iran. Singapore Airlines, for example, canceled some flights to and from Dubai starting Sunday and through Wednesday, citing 'a security assessment of the geopolitical situation in the Middle East.' And British Airways has similarly suspended flights to and from Doha through Wednesday. 'Safety is always our highest priority,' British Airlines said in a statement confirming its cancellations to The Associated Press, adding that it 'will keep the situation under review.' Air India on Monday announced it was ceasing 'all operations to the region as well as to and from the East Coast of North America and Europe' immediately until further notice. The airline, which is still reeling from a plane crash that killed at least 270 people earlier this month, added that India-bound flights from North America were being diverted or re-routed away from closed airspaces. Air tracking data from FlightAware showed 705 cancellations worldwide as of Monday afternoon. Dubai International Airport topped the list with 75 cancellations in and out of the airport as of around 5 p.m. ET. And Air India had had the highest amount of cancellations among carriers, totaling 38 as of 5 p.m. ET. Such disruptions have snarled travel, particularly as central hubs in the Middle East often connect flights worldwide — but experts stress that these kind of airspace closures and flight diversions are critical to ensuring safety, especially if future escalation emerges suddenly. 'It is the responsibility of states, countries to ensure that their airspace is safe for passage of aircraft,' Hassan Shahidi, president and CEO of the Flight Safety Foundation. He added that on Monday 'the Qataris did the absolutely right thing to close their airspace because of the threat of conflict.' Beyond Qatari airspace, Flightradar24 reported that UAE airspace was also closed on Monday. After several hours of diversions, flights appeared to be landing and taking off in the country again. Monday marks the latest 'dramatic increase' in this kind of impact, said Ian Petchenik, director of communications at Flightradar24. And while the future is unknown, he added that it's important to remember airspace closures and flight cancellations reflect that 'airlines, air traffic controllers and flight crews are doing their best to keep everybody safe.' Shahidi adds that it's important for travelers to monitor government guidance — such as safety notices from the US State Department. How long the war lasts and what, if any, future escalation comes next could carry more widespread implications. Beyond disrupting global flight networks farther down the road, Shahidi stresses that it's very difficult for people who may need or want to evacuate countries impacted by the war to do so without access to commercial flights. At the same time, he adds, it's critical that state authorities focus on keeping their skies safe — pointing to past tragedies of passenger flights that were shot down by strikes. That includes Malaysia Airlines Flight 17, which was shot down by Russian-backed forces while flying over Ukraine in 2014, killing 298 people. 'We are all praying and urging resolution to this conflict — and especially as it relates to protection of civilian air travel," Shahidi said. "We do not want to have an MH17, with innocent lives being lost in a missile strike ... We do not want to repeat that history.'
Mint
4 hours ago
- Mint
NATO's new 5% defence spending target and what it means
NATO leaders are set to endorse a sweeping increase in defence investment at a key summit in The Hague on Wednesday (June 24), responding to rising geopolitical tensions and direct pressure from US President Donald Trump. The landmark agreement would commit member states to spending 5% of their Gross Domestic Product (GDP) on defence and security-related investments by 2035—a significant jump from the current 2% benchmark. The proposed 5% spending goal will be divided into two parts: 3.5% of GDP on core defence, including troops, weapons systems, and combat readiness—up from the current 2% focus. 1.5% of GDP on broader security investments, such as cyber defence, infrastructure upgrades for military mobility, and energy security. This broader definition reflects modern security challenges, including the need to defend against hybrid threats and safeguard strategic supply chains. While 22 of NATO's 32 members already meet or exceed the 2% defence target, the new 5% threshold presents a major leap. In 2024, NATO countries collectively spent 2.61% of GDP on defence, though with wide disparities—Poland exceeded 4%, while Spain lagged at under 1.3%. If all members had spent 3.5% on core defence last year, total spending would have surpassed $1.75 trillion, compared to the $1.3 trillion actually spent. Member states are expected to meet the new target by 2035, with a review scheduled for 2029 to evaluate progress and potentially adjust expectations. The decision is driven by a combination of: Russia's ongoing war in Ukraine and fears of a broader military threat within the next five years. Concerns over a potential drawdown of US forces in Europe, especially if Trump returns to the White House. A broader reassessment of Europe's ability to defend itself. 'NATO must prepare for a future in which it has to take on more responsibility,' Secretary-General Mark Rutte said, pointing to urgent needs in air defence, tanks, drones, and personnel. While the agreement appears to have broad support, some nations are expressing reservations. Spanish Prime Minister Pedro Sanchez has said Spain will only aim for 2.1% of GDP, even though his government signed off on the final communiqué. Despite such statements, NATO insists there are no opt-outs, and national defence spending will be closely monitored.
