Israel's opposition leader Yair Lapid backs strikes on Iran, calls for global action
LONDON (Reuters) -Rising oil prices, Middle East tensions, a NATO meeting and a testimony by the U.S. Federal Reserve chief all vie for market attention in the days ahead. Here's your heads up on the week in world markets from Alden Bentley in New York, Kevin Buckland in Tokyo, Amanda Cooper and Lucy Raitano in London and Andrew Gray in Brussels. 1/ STRAIT UP WORRIED The Israel/Iran war has lit the fuse for a possible oil supply shock for investors. Brent crude has topped $75 for the first time since January. For now, there are no signs of disruption to output. Iran produces around 3.3 million barrels a day and exports around half that, according to Reuters and LSEG calculations, a fraction of the world's roughly-100 million barrels in daily consumption. A shortfall in Iranian barrels, while jarring to markets, could be offset by other OPEC countries tapping spare capacity to fill that void. What markets are more worried about is Iran blocking the Strait of Hormuz, through which some 20% of total daily crude supply passes. Analysts say it's unlikely. But a lot of things that were considered unlikely six months ago and are now a reality. Market volatility has room to pick up. European foreign ministers were set to meet their Iranian counterpart on Friday aiming to create a pathway back to diplomacy over its contested nuclear programme despite the U.S. considering joining Israeli strikes against Iran. 2/ GO BIG NATO aims to keep Donald Trump happy, hold the alliance together and agree a big new spending target in The Hague. It's also hoping the Israel-Iran conflict won't overshadow Wednesday's summit. Trump lambasted NATO members in his first term and threatened to quit the military alliance if they did not raise defence spending. Now, NATO boss Mark Rutte wants all allies to commit to Trump's proposed target of 5% of GDP. To do that, NATO will interpret defence more broadly. It would hike its current target of spending 2% of GDP on traditional defence – weapons, troops etc – to 3.5%. And members would spend at least 1.5% of GDP on broader measures such as adapting roads, bridges and ports to handle military vehicles and protecting against cyber-attacks. Only Spain is publicly opposing the new target. Due to the focus on pleasing Trump, Ukrainian President Volodymyr Zelenskiy may have to settle for a seat at the pre-summit dinner rather than the meeting itself. 3/ NEXT QUESTION Markets will look to Fed boss Jerome Powell to elaborate on what his expectation for 'meaningful' inflation means for the rate outlook when he testifies before Senate and House committees on Tuesday and Wednesday. Powell told reporters after the Fed's June meeting that goods price inflation is coming as tariffs work their way to consumers. Having stressed that a solid expansion continues, Powell could also be asked how a further Middle East escalation impacts inflation. Thursday's final read on first quarter GDP meanwhile should confirm that the economy shrank. The Fed's favorite inflation indicator, the Personal Consumption Expenditures Price Index for May on Friday, will be read through the lens of the Fed's decision to leave rates alone, while predicting two cuts this year. 4/ STRONG BONDS? A month ago, Japanese government bond yields surged to record peaks as investors baulked at auctions and the prime minister ill-advisedly compared Japan's fiscal predicament to Greece's. Now, things couldn't look more different thanks to some deft team play between the Bank of Japan and Ministry of Finance. Just days after the BOJ tweaked its bond taper plans to keep buying more of the super-long debt at the heart of the yield spike, the finance ministry presents a plan to cut issuance of the longest-dated securities. The BOJ's dovish tone on future rate hikes has also helped keep yields in check this week, although Governor Kazuo Ueda left the door open to policy tightening this year by highlighting the risks from broadening price pressures. Tokyo CPI for this month and published on June 27 will give fresh hints on how soon the central bank may need to act. 5/ HOLDING UP? U.S. President Donald Trump's reciprocal tariffs initially led to order front-loading, supporting global business activity, but that is fading fast with global recession creeping back up. With little forward guidance from companies, economic indicators are more vital than ever for markets, and a raft of them hit screens in days to come. Monday brings the first release of June business activity for a host of economies including the euro area, Britain and the United States. Hopes are for better news from the euro zone after May's PMI slipped to 50.2 from 50.4 in April, moving closer to the 50 mark that separates a contraction from an expansion. Particularly concerning was the bloc's dominant services sector contracting for the first time since November. Meanwhile in the UK, the May PMI showed the services sector returning to tepid growth. (Compiled by Dhara Ranasinghe; Graphics by Prinz Magtulis; Editing by)
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Mint
19 minutes ago
- Mint
A corporate deal that protected the Amazon from soy farming starts to show cracks
* Brazilian farmers are pushing soy crops deeper into Amazon * Powerful farm lobby attacks Amazon Soy Moratorium * Regrown rainforest does not get the same protection SANTAREM, Brazil, June 20 (Reuters) - Brazilian soy farmers are pushing further into the Amazon rainforest to plant more of their crops, putting pressure on a landmark deal signed two decades ago aimed at slowing deforestation. Many are taking advantage of a loophole in the Amazon Soy Moratorium, a voluntary agreement signed by the world's top grain traders in 2006 that they would not buy soy grown on land deforested after 2008. protects old-growth rainforest that has never before been cleared, but excludes many other kinds of vegetation and forests that have regrown on previously cleared land, known as secondary forests. While this land is also important for preserving the fragile Amazon biome, farmers can raze it and plant soy without violating the terms of the Moratorium and could even market it as deforestation-free. The most recent official annual report on the Moratorium, which covers the crop year 2022-2023, showed that soy planted on virgin forest has almost tripled between 2018 and 2023 to reach 250,000 hectares, or 3.4% of all soy in the Amazon. Its study area is limited to municipalities that grow over 5,000 hectares of soy. However, Xiaopeng Song, a professor at the geographical sciences department of the University of Maryland who has tracked the expansion of soy over the past two decades, found more than four times that forest loss. Satellite data he analyzed exclusively for Reuters shows 16% of Brazilian Amazon land under production for soy, or about 1.04 million hectares, is planted where trees have been cleared since 2008, the cutoff date agreed in the Moratorium. "I would like to see secondary forest and recovered forest included in the Moratorium," said Song. "It creates loopholes if we only limit it to primary forest." Abiove, the soy industry body overseeing the Moratorium, said in a statement that the agreement aims to rein in deforestation of old-growth forests while other methodologies have broader criteria that could lead to "inflated interpretations." Reuters was unable to make a detailed comparison because Abiove declined to share granular data. Data in the Moratorium report comes from Brazil's National Institute of Space Research, and its assessments are recognized internationally and monitored independently. Abiove said it was aware that some soy was planted in areas where regrown forests had been cut. The discrepancy over how to define a forest has huge implications for conservation. Deforestation, drought and heat driven by climate change bring the rainforest closer to a tipping point beyond which it starts an irreversible transformation into a savannah. Most scientists are calling not only for a halt to all deforestation but also for increased efforts to reforest. Viola Heinrich, a post-doctoral researcher at the GFZ Helmholtz Centre for Geosciences, who has extensively studied secondary forests in the Amazon, said these were "crucial" in limiting global warming even if initially less biodiverse. "We cannot achieve the goals of the without actively increasing the carbon sink," she said, referring to regenerating ecosystems that rapidly Secondary forests absorb carbon at a faster rate than old-growth forests, but store less of it. On a scorching afternoon late last year, on the outskirts of Santarem, a port city by the Amazon River, farmers were in the last stages of clearing land. Felled trees were neatly stacked up in rows, ready to be burnt. Some of these trees were around three decades old, part of a secondary forest on land that was once razed to make way for cattle but later abandoned, satellite images showed. "What can be stolen once, can be stolen again," said Gilson Rego, of the Pastoral Land Commission, a church-affiliated group working with locals affected by deforestation, as he pointed to surrounding areas where soy had been planted. In the last five years, Rego saw the area dedicated to the crop soar. More than a dozen soy and subsistence farmers who spoke to Reuters said the main draw was the nearby Cargill terminal from where soy is shipped worldwide because it reduces costs for logistics. Cargill did not respond to requests for comment. The boom helped Brazil overtake the United States in 2020 as the world's largest soy exporter. About two thirds of it ships to China, whose largest buyer, Cofco, has signed up to the Moratorium and said earlier this year that it was committed to it. Nearly all of it is used to fatten animals for meat production. Still, Song estimated an additional 6 million hectares of the rainforest would have been lost to soy in Brazil without the Moratorium and related conservation efforts, considering the pace of expansion elsewhere. Neighboring Bolivia, he said, had become a deforestation hot spot. Brazilian farmers have always opposed the Moratorium and complained that even a small amount of deforestation can lead traders to block purchases from entire farms, a policy that Abiove is considering changing. Thousands of properties that cover some 10% of soy's footprint in the region are currently blocked. Adelino Avelino Noimann, the vice president of the soy farmers association in Para state, where Santarem is located, said the soy boom was creating opportunities in a poor country. "It's not fair that other countries in Europe could deforest and grow, and now we are held back by laws that are not even ours," said Noimann. LEGAL ATTACKS Farming groups allied with right-wing politicians, once a fringe movement, have launched lawsuits and legislative attacks on the Moratorium in the capital Brasilia, and half a dozen major agricultural states, seeking to weaken its provisions. At the end of April, a justice from Brazil's Supreme Court said it would allow the country's biggest farming state, Mato Grosso, to withdraw tax incentives from signatories of the Moratorium. The ruling still needs to be confirmed by the full court. Andre Nassar, the president of Abiove, the soy industry body that oversees the Moratorium, has already hinted that it could weaken rules to appease farmers. "The solution is not ending the Moratorium or keeping it as it is," Nassar told senators in April. "Something needs to be done." Global traders including ADM, Bunge, Cargill, Cofco and Louis Dreyfus Company had all signed up back in 2006. Abiove and the grain traders it represents have declined to publicly discuss details but environmental group Greenpeace, which is part of some discussions, said last year that behind closed doors there was a push from traders to weaken it. Environmentalists like Andre Guimaraes, an executive director at IPAM, another nonprofit that monitors the agreement, said that even with its faults it was important. "We still see the expansion of soy in the Amazon," he said. "But it could be worse." Other environmentalists said it should be reinforced by closing loopholes. Abundant water and nutrient-rich soil are the main reasons farmers from other parts of the country, including the soy heartland Mato Grosso, have moved to Para. "Here, we can have as many as three harvests," said Edno Valmor Cortezia, the president of the local farmers union, adding that farmers there can grow soy, corn and wheat on the same plot in a single year. In the municipality Belterra near Santarem, soy expansion stopped short only at a local cemetery and school. Raimundo Edilberto Sousa Freitas, the principal, showed Reuters court records and supporting evidence for two instances when 80 children and teachers had symptoms of pesticide intoxication last year. One farmer was later fined, the records showed, but the crop continues to claim more of the area every year. Occasionally, a few imposing trees that are protected by law are left in sprawling fields of soy, the last reminder of the lush biome that was once there. (Reporting by Stefanie Eschenbacher in Santarem, Brazil; additional reporting by Ana Mano in Sao Paulo; editing by Manuela Andreoni, Brad Haynes and Claudia Parsons)
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Business Standard
20 minutes ago
- Business Standard
What is Samson Option, Israel's nuclear threat that's no longer a theory?
Tensions between Israel and Iran have escalated sharply after 'Operation Rising Lion' — Israel's largest strike on Iranian nuclear sites since the 1981 Osirak raid. Iran has responded with missile and drone attacks, straining Israeli defence systems and prompting fears of wider conflict. With Hezbollah mobilising in the north, Houthi threats rising in the Red Sea, and the possibility of a multi-front war looming, Israeli security doctrine is under renewed global scrutiny. At the centre of that attention is the Samson Option, Israel's undeclared but long-assumed nuclear last-resort policy. Once regarded as a Cold War-era relic, the Samson Option has re-emerged as a global worry with serious implications for global security, defence markets, and diplomatic stability. What is the Samson Option? The Samson Option is widely understood as Israel's nuclear last-resort strategy: threat of massive retaliation if the country's survival is at stake. The name is derived from a reference of the biblical figure Samson, who brought down a Philistine temple upon himself and his enemies, an allegory for apocalyptic deterrence. Though Israel has never confirmed possessing nuclear weapons, its policy of 'Amimut' (Israel's policy of neither confirming nor denying the possession of nuclear weapons), or deliberate ambiguity, has kept adversaries guessing. However, foreign assessments suggest Israel has 80 to 400 nuclear warheads, with delivery systems spanning land-based missiles, submarines, and aircraft. The doctrine entered public discourse in the 1990s via US investigative journalist Seymour Hersh, who, in his book The Samson Option: Israel's Nuclear Arsenal and American Foreign Policy, explored Israel's nuclear journey and its relation with the United States. Since then, Israel hardened its 'strategic ambiguity' concept over the possession of a nuclear arsenal. How did Israel build its nuclear arsenal? Israel's nuclear journey began in the 1950s, with the then Prime Minister David Ben-Gurion envisioning a survival insurance policy for the newly-formed Jewish nation. With covert help from France and Norway, Israel established the Dimona nuclear facility, presented publicly as a research centre. By the time of the Six-Day War in 1967, Israel is believed to have constructed its first nuclear weapon. Who is Samson, and why is Israel's nuclear policy named after him? The doctrine's name draws from the Book of Judges, where Samson, betrayed, blinded, and imprisoned, sacrifices himself to destroy his enemies. This story, ingrained in Israeli strategic thinking, underlines the nation's message: if its destruction is imminent, it will not go quietly. Yet unlike the doomed biblical hero, modern Israel is a technologically advanced military power. The Samson Option, therefore, is not desperation, but a calculated deterrent, designed to force potential adversaries to think twice. What nuclear weapons does Israel have? Although never confirmed, Israel is among the nine nuclear-armed nations alongside the United States, Russia, China, the UK, France, India, Pakistan, and North Korea. Estimates suggest Israel possesses about 90 warheads, with enough plutonium to build up to 200 more, according to the Nuclear Threat Initiative. Its arsenal is believed to include: > Aircraft: Modified F-15, F-16, and F-35 jets capable of carrying nuclear payloads. > Submarines: Six Dolphin-class submarines, reportedly capable of launching nuclear cruise missiles. > Ballistic missiles: The land-based Jericho missile family, with a range of up to 4,000 km. Around 24 of these missiles are believed to be nuclear-capable. What was the Vela incident? Israel is the only nuclear power which has not openly conducted a nuclear test. The closest indication came in September 1979, when US satellites detected a double flash over the South Atlantic, an event known as the 'Vela Incident'. At the time, US President Jimmy Carter reportedly believed Israel had conducted a nuclear test in collaboration with apartheid-era South Africa. 'We have a growing belief among our scientists that the Israelis did indeed conduct a nuclear test,' Carter later wrote in his diaries, which were made public in 2010. Despite speculation, Israel has never confirmed its involvement in the incident. How was Israel's nuclear arsenal revealed to the world? In October 1986, former nuclear technician Mordechai Vanunu exposed Israel's nuclear programme in an explosive interview with the Sunday Times. Having worked at the Dimona plant for nearly a decade, Vanunu revealed that Israel was capable of producing 1.2 kg of plutonium per week, enough for 12 warheads annually. He also disclosed how Israeli officials had deceived US inspectors during visits in the 1960s with false walls and concealed elevators, hiding entire underground levels of the facility. Vanunu was later abducted by Mossad in Rome, tried in Israel, and sentenced to 18 years in prison, spending over half that time in solitary confinement. Even after his release in 2004, he remains under strict surveillance, barred from foreign travel and media engagement. With West Asia at the edge of a potential multi-front war, Israel's Samson Option has moved from the realm of whispered deterrence to an option in real-world decision-making. Its existence, unconfirmed but globally acknowledged, adds a nuclear dimension to an already combustible region.
Hindustan Times
23 minutes ago
- Hindustan Times
Monthly social security checks could be cut by this year if Congress doesn't act
The Social Security Administration's (SSA) trust fund is slated to run out a year earlier than previous predictions as per 2025's Trustee Report Summary released on Wednesday (June 18). This could put about 70 million current beneficiaries of the system at risk as the demographic in the US starts shifting from a younger tax-paying population to an older benefit-ridden one. Although numbers can alter from year to year based on fluctuations in the economy and regulations in the number of beneficiaries, one thing is clear: the SSA's funds will deplete sooner rather than later and leave millions in the lurch. The root of the issue lies in the fact that the number of dependents is rapidly increasing and is projected to overshadow those contributing to the system. As the program's data suggests, the number of people claiming benefits jumped 17% to 1.8 million in May 2025 and is already on the fast track to enlisting 4 million additional beneficiaries this year. In addition, the recent implementation of the Social Security Fairness Act has substantially increased the pool size and quantum of benefits per individual. Dependents of and those receiving public pensions are now eligible to receive full benefits from the program. This puts additional constraints on an already overburdened system. The report implies that funds are now expected to run out by 2034, a year earlier than what was predicted earlier. 'If the Old-Age and Survivors Insurance (OASI) Trust Fund and the Disability Insurance (DI) Trust Fund projections were combined, the resulting projected fund (designated OASDI) would be able to pay 100 percent of total scheduled benefits until 2034, one year earlier than reported last year. At that time, the projected fund's reserves would become depleted, and continuing total fund income would be sufficient to pay 81 percent of scheduled benefits,' the report claims. The only viable solution to this situation is to either reduce the benefits/beneficiaries or increase the amount of revenue generated. Poll after poll declares that the public is increasingly in favor of the latter option over the former, since they oppose the principle of depriving those in need of crucial funds. 'To ensure we serve the public and deliver high-quality service to the 185 million people who work and pay payroll taxes for Social Security and the 70 million beneficiaries who will receive benefits during 2025, the financial status of the trust funds remains a top priority for the Trump Administration,' said Commissioner of Social Security Frank Bisignano in a statement published by the US Department of the Treasury. One popular approach suggested by multiple advocacy groups is to raise the cap for taxable income from the current threshold of $176,100. This 'tax the rich' has garnered favor among those who believe the wealthy should be responsible for bankrolling the SSA's depleting funds. The idea of raising the full retirement age to 70 years instead of the current 67 has failed to gain much support amid fears that the same may deprive an older population of much-needed support. Amid recent job cuts and multiple other changes at the SSA, stability of income after retirement has become all the more crucial. As Bisignano said, 'Congress, along with the Social Security Administration and others committed to eliminating waste, fraud, and abuse, must work together to protect and strengthen the trust funds for the millions of Americans who rely on it – now and in the future – for a secure retirement or in the event of a disability.'
