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00:00:01Now on BBC. News, the latest from New York and around the world.
00:00:05world. Business Today. MUSIC
00:00:15MUSIC Live Live at the opening bell. This is
00:00:17is Business Today. Stubborn inflation inflation and rising borrowing costs.
00:00:21costs. Markets are facing a perfect perfect storm petrel and housing
00:00:24housing costs pushed consumer prices
00:00:26prices up 0.4% in August, and the
00:00:29the ten year Treasury yield hits
00:00:30hits highest level in 19 years. The
00:00:34The oil price stands at $106 a barrel.
00:00:37barrel. As President Trump says the
00:00:39the US is open to restarting negotiations,
00:00:43negotiations, adding that Tehran Tehran wants to make a deal quickly
00:00:46quickly and badly. The US scraps
00:00:50scraps limits on emissions from coal
00:00:52coal and gas power plants in Europe's
00:00:55Europe's biggest names in transport transport join forces to bring hydrogen
00:00:58hydrogen powered trucks to the to
00:01:02to roads. Welcome to Business Today.
00:01:05Today. Live from New York. I'm Samira Samira Hussain now. Donald Trump
00:01:08Trump says Iran badly wants a deal
00:01:10deal even as tensions around key key oil routes escalate. Attacks
00:01:14Attacks in the Middle East have pushed pushed shipping at the Strait of
00:01:17of Hormuz sharply down just for commodity
00:01:20commodity vessels moved through on on Monday, compared with ten the
00:01:23the day before. Meanwhile, Houthi Houthi forces have intensified strikes,
00:01:27strikes, hitting a major Saudi base.
00:01:29base. The group also claims to have
00:01:32have seized more strategic islands islands in the southern Red Sea.
00:01:35Sea. Michelle Brookhart is head of
00:01:38of policy and geopolitical risk at
00:01:40at Kpler. How significant are these
00:01:44these current disruptions? They're They're pretty significant. They've
00:01:48They've raised the price of oil to
00:01:52to $106 a barrel, and oil prices
00:01:54prices continue to rise as the disruption
00:01:58disruption continues to take oil oil off of the market. We've also
00:02:01also seen disruption around the world, world, even in Russia, Ukraine. We've
00:02:04We've seen disruption. So there's there's a lot of disruption happening
00:02:07happening just at the very end as
00:02:09as Strategic petroleum reserves start
00:02:12start to finish off their release.
00:02:14release. So that extra buffer that that we had over the last several
00:02:17several months is now finishing up. up. And so that's why one of the
00:02:21the reasons why you're starting to to see prices rise. Well, that was
00:02:25was going to be my next question
00:02:28question in terms of those reserves, reserves, how long until countries
00:02:30countries start running out of oil?
00:02:34oil? Well they still have we still still have commercial reserves that
00:02:37that countries can start pulling pulling on. But those reserves, those
00:02:40those commercial inventories are are also starting to draw down the
00:02:44the emergency stockpiles that were were released by the IEA at the very
00:02:47very beginning of the war that was was announced by the IEA. That's
00:02:49That's being released in the US and
00:02:52and the OECD countries. Those are
00:02:55are the that release is finishing finishing up over the next couple
00:02:58couple of weeks. So by the time the
00:03:01the SPR is finished releasing the
00:03:04the next inventory buffer, you could could say are going to be commercial
00:03:07commercial stocks unless the IEA IEA announces another inventory release,
00:03:11release, which would be unprecedented.
00:03:14unprecedented. Now, if secret shipments shipments and pipelines are compromised.
00:03:17compromised. I'm wondering what this
00:03:19this means for global oil supplies.
00:03:24supplies. Well the disruption has has been happening for so for the
00:03:26the last six months and we really really have seen global oil supplies,
00:03:30supplies, specifically diesel supplies supplies start to dwindle down as
00:03:34as we head into harvest season, as as we head into heating season. And
00:03:38And so as supply starts to go continue
00:03:42continue to draw down as inventories inventories continue to draw down down and supplies are disrupted, disrupted, we're going to continue
00:03:46continue to see higher prices not not just in the US but globally.
00:03:49globally. And in fact, you'll start
00:03:51start to see countries that already
00:03:53already have fiscal shortages or
00:03:57or fiscal fiscal fiscal deficit where
00:03:59where they can't necessarily buy
00:04:01buy pay up to buy more fuel. You'll You'll start to see those countries
00:04:05countries really have problems. Like Like if you think about countries countries that we had that had problems
00:04:09problems at the very beginning of of the war, those we should start start to see those disruptions happening
00:04:13happening again in some of those
00:04:15those countries. Michelle Brookhart, Brookhart, this is certainly something
00:04:19something we're going to be talking talking about for the next several several months of Kpler. Thank you
00:04:22you very much for joining us. Thank
00:04:24Thank you so much for having me.
00:04:26me. Now Treasury yields jumped sharply sharply ahead of the meeting of the
00:04:30the Federal Reserve with the ten
00:04:32ten year bond climbing to its highest
00:04:36highest level since 2007. Now the the move reflects rising expectations
00:04:39expectations of tighter financial financial conditions going forward.
00:04:42forward. Anna Rathburn, founder and
00:04:44and CEO of Grenadier Advisory. Treasury
00:04:47Treasury yields hit 5%. How concerning
00:04:49concerning is that? Well, you know,
00:04:52know, the longer term yields are are actually reflecting some of the
00:04:55the things that we just talked about, about, which is higher oil prices.
00:04:58prices. It's actually anticipating anticipating the possibility that
00:05:01that there could be an inflationary
00:05:04inflationary impact over the long-term. long-term. The other thing that it's
00:05:08it's anticipating is the fact that
00:05:09that we may have a longer or higher
00:05:12higher growth rates from all of this
00:05:14this AI activity in the longer term.
00:05:17term. So it is concerning for people
00:05:19people who need to borrow at this
00:05:21this time. But if some of these indicators indicators actually are not that
00:05:25that terrible and also if something
00:05:28something happens in Iran, the conflict conflict and actually it actually
00:05:31actually slows down and oil prices
00:05:33prices come back down, then it actually actually could have a positive impact
00:05:37impact on yields by bringing it down
00:05:40down as well. But isn't this perhaps
00:05:42perhaps telling us that the markets markets are not that confident that
00:05:45that something like that going to to happen, especially if you look
00:05:48look at the last inflation report,
00:05:50report, the CPI we saw that, you you know, a third of inflation is
00:05:54is related to the high price of oil.
00:05:56oil. Yeah. So CPI as well as PPI,
00:05:59PPI, we saw that a lot of the main main driver of those numbers in the
00:06:03the headline numbers were actually actually energy. But it also means
00:06:06means that it was isolated to energy. energy. Right. And so you know, the
00:06:10the impact of the Iran war on oil
00:06:12oil prices have been very binary. binary. If you have a positive news
00:06:16news on the de-escalation of conflict, conflict, oil prices fall and vice
00:06:20vice versa. So I think this is one one of those things that can actually
00:06:23actually have an impact that no one one can predict up or down in, in
00:06:27in a big way. Right. So I don't think
00:06:30think it is actually it is expecting expecting it right now because escalation
00:06:34escalation is higher, but it doesn't doesn't mean that it's going to continue
00:06:38continue forever. And the government government announced the bond buyback
00:06:41buyback last week, but it really
00:06:42really didn't make a dent did it?
00:06:46it? No it didn't. And you know, if if you think about the $6 billion
00:06:49billion number, it's a drop in the the bucket in the Treasury market.
00:06:52market. Treasury market is $32 trillion.
00:06:55trillion. So I think it was used used more as a signalling mechanism
00:06:58mechanism that the Treasury Department Department is supporting the Treasury
00:07:01Treasury market. But, you know, it it happened to backfire. And I don't
00:07:05don't think that was the impact they they intended. But nevertheless, nevertheless, it happened. And part
00:07:08part of it also is if you say that that you are the House and that you
00:07:12you have asymmetric information, information, you know, that doesn't doesn't bode well for traders who
00:07:16who are expecting the market to be
00:07:17be trading freely. Anna Rathburn
00:07:21Rathburn of Grenadilla Advisory, Advisory, thank you very much for
00:07:23for joining us. Thank you. Now, Europe's
00:07:27Europe's biggest names in transport transport and energy are joining
00:07:30joining forces in a major push to to bring hydrogen powered heavy trucks
00:07:34trucks onto the road by 2030. Now, Now, the firms say the technology
00:07:38technology is ready, but the ecosystem ecosystem around it isn't. Details
00:07:41Details of the programme have been
00:07:43been announced by the company's CEO
00:07:46CEO at the IAA Transportation event
00:07:48event in Hannover. Julia Caesar reports. reports. Heavy duty transport is
00:07:51is one of Europe's biggest remaining remaining sources of emissions. Hydrogen
00:07:55Hydrogen has long been seen as a a promising solution for long haul,
00:07:58haul, heavy duty transport, but progress
00:08:01progress has been slow. Without a
00:08:04a co-ordinated ecosystem, Europe
00:08:08Europe has about 6.5 million diesel diesel trucks producing a quarter
00:08:11quarter of all road transport emissions. emissions. Stand by any busy road
00:08:15road like this one and you can feel feel the noise and pollution that
00:08:19that they create while switching switching heavy trucks to hydrogen
00:08:23hydrogen would mean zero tailpipe
00:08:26tailpipe emissions quieter roads roads and cleaner long haul freight.
00:08:30freight. The initiative aims to make make hydrogen trucks commercially
00:08:33commercially viable. That means tackling tackling one of the biggest barriers
00:08:36barriers to adoption the total cost
00:08:38cost of ownership. Coming together together between different actors
00:08:41actors in the ecosystem is so important important because we think that the
00:08:45the business case, the technology technology is there and now it's
00:08:48it's about really to make sure that
00:08:51that we are putting also the right
00:08:54right conditions to provide business business models for scaling. The
00:08:58The plan includes strategically placed
00:09:00placed refuelling corridors along along key transport routes designed
00:09:04designed to give operators confidence confidence that hydrogen will be
00:09:07be available where and when they
00:09:09they need it. Countries and regions
00:09:11regions that are driving this agenda
00:09:14agenda can combine a competitiveness
00:09:17competitiveness and resilience or
00:09:19or energy resilience. So to speak.
00:09:23speak. Regional security and also also competitiveness and eventually,
00:09:27eventually, which is super important important decarbonisation, less pollution pollution and less noise when it
00:09:31it comes to mobility. Hydrogen offers
00:09:33offers fast refuelling, high energy energy density and the ability to
00:09:37to keep freight moving without adding
00:09:39adding huge battery packs. Experts
00:09:42Experts say that shifting these trucks
00:09:45trucks to hydrogen is essential if
00:09:47if Europe is going to meet its climate
00:09:50climate targets. Europe's transport transport sector is preparing for
00:09:54for a hydrogen powered future and
00:09:56and the race to build it has officially
00:09:58officially begun. Julia Caesar, BBC
00:10:02BBC News. Now the head of the US
00:10:05US Environmental Protection Agency Agency has scrapped rules limiting
00:10:08limiting pollution from coal and and gas plants. The agency says it
00:10:12it will also stop future administrations administrations from regulating power
00:10:15power plant emissions. It says scrapping
00:10:17scrapping the rules will save $310
00:10:20$310 billion. Environmental groups groups are opposed to the move. Here's
00:10:24Here's Lee Zeldin making the announcement.
00:10:27announcement. Today we are repealing
00:10:28repealing the majority of the burdensome
00:10:31burdensome 2024 requirements so that
00:10:33that Americans can benefit from our
00:10:35our nation's full energy potential. potential. But we aren't just stopping
00:10:39stopping with the Biden administration's administration's overreach. We are
00:10:42are also proposing to rescind all
00:10:45all remaining greenhouse gas emissions emissions standards for power plants,
00:10:49plants, all of them. Well, for more
00:10:52more on that, I'm joined now by climate
00:10:54climate scientist Deborah Brosnan, Brosnan, founder of consultants Deborah
00:10:58Deborah Brosnan and Associates. How How significant is this impact is
00:11:01is the impact of scrapping these
00:11:03these limits? Well, there are two two things at play which you just
00:11:07just heard him say there. They're
00:11:08They're quite significant. The first first one, which is effectively rescinding
00:11:12rescinding the rule from 2024, means
00:11:17means that what is signalling to to the world is that we've changed. changed. The US is going to really
00:11:21really favour the industry and emissions emissions as we go forward. So this
00:11:24this rule that he talks about basically
00:11:26basically was designed to cut about
00:11:29about 1.4 billion tonnes of carbon
00:11:32carbon dioxide by 2047. It didn't
00:11:34didn't come into play until 2030.
00:11:372030. So what it was doing was giving
00:11:38giving the industry time to reinvest,
00:11:41reinvest, to retool, to put everything everything in place for this new
00:11:45new future where we were looking looking more at renewable energies.
00:11:47energies. And for the last few years,
00:11:49years, energy emissions have been been reducing in the US except for
00:11:53for last year when they went up by
00:11:55by 4%. So that's that first, what what he's done for us is to take
00:11:59take that off the table. So that that is now gone. The second element
00:12:02element that he spoke about is the the more strategic and probably the
00:12:05the more interesting, because what
00:12:07what he's proposed is to change the
00:12:11the law, which would say that the
00:12:13the EPA can no longer regulate greenhouse
00:12:15greenhouse gases. Now, if you do do that, you're effectively changing
00:12:18changing the Clean Air Act. So administrations
00:12:22administrations can change rules rules and policies on emissions. emissions. And they do. We've gone
00:12:25gone back and forth between Biden
00:12:27Biden and Trump and Obama. But the
00:12:30the second part, if that does go go through and it's a proposal right
00:12:34right now that basically says no
00:12:36no future administration can come
00:12:39come back and require the EPA to to regulate greenhouse gas emissions
00:12:43emissions from the power industry. industry. And that is a huge, huge
00:12:46huge shift in policy right? Not just
00:12:49just a move that affects people now,
00:12:51now, but really does affect future
00:12:54future generations. And administrations. administrations. Deborah Brosnan, Brosnan, thank you very much for
00:12:57for joining us. That's all for business.
00:12:59business. Please stay tuned for more
00:13:03more with BBC News. MUSIC
00:14:19giants. That's all on The Media Show
00:14:23Show on BBC News. There is nothing
00:14:30nothing like driving into a moving moving story and not knowing what
00:14:33what is going to happen. You can can hear the sound of celebratory
00:14:36celebratory gunfire. I live for those those moments. Journalism is about
00:14:40about being there as events unfold unfold and telling people not only
00:14:43only what happened but why it matters
00:14:45matters and what it means. History History happens in real time and
00:14:49and someone needs to be there to
00:14:52to witness it.
00:15:09Hello. Welcome back. Both Ukraine and Russia have continued
00:15:13continued their strikes on each other other overnight. Ships in a warehouse
00:15:17warehouse struck in Odesa. The images images you're seeing here show firefighters
00:15:20firefighters tackling fire at a warehouse warehouse in the region after a Russian
00:15:23Russian strike. The Russian city
00:15:26city of Taganrog also came under under a large-scale Ukrainian drone
00:15:30drone attack. Meanwhile, the head head of Ukraine's state Post Office
00:15:33Office has told the BBC Russia is is deliberately targeting his branches
00:15:37branches and delivery vans. Igor Igor Smelyansky said this was because
00:15:40because his staff provided a lifeline lifeline for millions left isolated
00:15:44isolated by the war. Our diplomatic diplomatic correspondent James Landale Landale has been out on the road
00:15:48road in Ukraine. He's been meeting meeting some of the posts men and
00:15:50and women who deliver more than just
00:15:53just parcels. This is all that's.
00:15:56that's. Left of Katarina's Post Office. Office. Widowed by war.