Trump Optimistic on Iran Deal; Gulf Leaders Say Deal '6 Months Away'

0:01Bloomberg Audio Studios Podcast Radio News good morning i'm nathan hager and i'm karen moscow here are the stories we're following today karen the ceasefire between the u.s and iran is set to expire in just four days but president trump is putting out an optimistic message that the war in the middle east could wrap up even before that iran wants to make a deal and we're dealing very nicely with them we've got to have No nuclear weapons, if we do, that's a big factor. And they're willing to do things today that they weren't willing to do two months ago. The president spoke to reporters outside the White House yesterday.

0:45Bloomberg's Patrick Sykes has more from Istanbul. He pointed to two things in particular. One, the opening of the Strait of Hormuz, obviously key for energy markets globally and beyond. And two, he referred to a statement that the U.S. has received from Iran to the effect that it won't pursue nuclear weapons. I think it's worth mentioning that both of those things were, of course, the case before the war six weeks ago. So I think it remains to be seen. Are we talking about a return to a status quo or a kind of substantively new arrangement between those two longtime enemies? Bloomberg's Patrick Sykes reports President Trump says the two sides might meet again for direct talks this weekend.

1:27Meanwhile, Israel and Lebanon have called a 10-day ceasefire in their conflict. And President Trump says the U.S. will work with both those sides on a lasting deal. He didn't mention Hezbollah in the announcement, but that Iran-backed militant group in Lebanon appears to be abiding by the truce. Well, Nathan, Bloomberg News has learned that some European and Gulf leaders believe securing a lasting U.S.-Iran peace deal could take around six months. We get more with Bloomberg Chief Europe Correspondent Oliver Crook. I think it sort of highlights the difference between the European approach to diplomacy, the Trump administration approach to diplomacy.

2:02Their style has us geared towards Whitcoff is here, J.D. Vance is here. Is there a deal? Is there not a deal? Oh, there's no deal. So there's not going to be a deal. I mean, these are processes that are very, very complex. They require a lot of discussion, a lot of trust that obviously doesn't exist at the moment. And it seems that potentially now with the discussions we're hearing from the Trump administration, that they may be rebasing a timeline around sort of extending that ceasefire by a couple of weeks. The Europeans are saying, hey, this could be a sort of six-month process. And I think that is partially their ambition to try to bring some calm, some stability.

2:31And of course, as you know, the longer a ceasefire sort of endures, the less likely it is to go back to a hot war. Obviously, though, that is never off the table. Bloomberg's Oliver Crook says the leaders want the Strait of Hormuz opened immediately to restore energy flows. They're warning a global food crisis may develop if that doesn't happen by next month. Well, Karen, we're seeing oil drop this morning as the war nears its 50th day. Right now, West Texas Intermediate crude is down nearly 2.5 % at$92.39 a barrel. Brent is down 2 % at$97.39. Fatah Birol, the executive director of the International Energy Agency, tells Bloomberg it will take time to recover a significant share of oil and gas production.

3:11The situation will gradually improve, but according to our analysis, it can take up to two years to see the big chunk of the production coming back to the before war levels. Catch our full conversation with IEH Chief Fatih Birol on our video hub on the Bloomberg Business App. Well, Nathan, Chinese President Xi Jinping is wrapping up a busy week of high profile diplomatic meetings in Beijing. Xi has been positioning China as a source of stability and respect for international rules amid the U.S. conflict with Iran and President Trump's threats. Among those, President Xi has met with our Spain's Prime Minister Pedro Sanchez, a U.S.-NATO ally, and Abu Dhabi's Crown Prince Sheikh Khaled bin Mohammed.

3:58Well, back here in the U.S., Karen, President Trump's trying to downplay voter concerns about the war's impact on the economy. At an event in Las Vegas promoting his tax cut bill, the president said he's heard warnings about soaring energy prices. Sir, don't do it, sir. $300 a barrel. It's going to be a wild thing. It's going to be horrible. The depression is going to happen. Well, not going to happen because we just hit a brand new all-time high. The president appeared to be referring to new records for the S &P 500 and NASDAQ 100. He's on a West Coast swing through Nevada and Arizona, touting his economic message.

4:32Recent polls show most Americans disapprove the president's handling of the war and blame him for rising gas prices. On Capitol Hill, Nathan, the House burned the midnight oil to pass an extension of surveillance powers that are due to expire early next week. Lawmakers voted unanimously to extend Section 702 of the Foreign Intelligence Surveillance Act, but only for two weeks. Several conservatives joined with Democrats to kill a five-year extension that House leaders proposed and President Trump supported. Georgia Republican Austin Scott pushed for the longer deal. We cannot allow Section 702 to lapse.

5:07Not at a moment where our adversaries are expanding their capabilities, accelerating their operations, and exploiting every gap in our intelligence posture. Now the Senate has to pass the short-term deal or the spy powers will lapse on Monday. Back to the markets now, Karen. Stocks are coming off back-to-back record highs. We mentioned the record for the S &P 500. It's on course for a third week of more than 3 % gains. And with the NASDAQ 100 at a record as well, the tech-heavy index has gained for 12 straight sessions, its longest winning streak since 2017. And right now, futures are pointing to even more gains, with S &P futures up 0.2 % and NASDAQ futures up 0.1%.

5:47Nathan, Netflix shares they're streaming lower. They're down about 10 % this morning. The company gave a forecast for the second quarter that fell short of analysts' expectations. It's the first earnings report since Netflix walked away from the battle for Warner Brothers Discovery. Geetha Raghunathan covers Netflix for Bloomberg Intelligence. You know, we're not necessarily seeing a great acceleration in the revenue numbers, in the operating margin numbers, which is exactly what they needed to show in order to, you know, basically assuage investors that did not need Warner Brothers Discovery.

6:18So this kind of leaves investors, I think, a little bit, you know, hanging a little bit. And Bloomberg intelligence analyst Geetha Raganathan says Netflix also announced chairman and co-founder Reed Hastings is stepping down from the board to pursue philanthropy and personal interests. And there's a changing of the guard of sorts at Apple, Karen. The marketing executive in charge of Apple Watch, AirPods, health and smart home initiatives is also retiring. Stan Ung worked at Apple for 31 years. In his role, he helped devise the original Apple Watch and helped launch the original iPod.

6:55Time now for a look at some of the other stories making news in New York and around the world. And for that, we're joined by Bloomberg's Michael Barr. Michael, good morning. Good morning, Karen. President Trump insists to reporters at the White House that he is not feuding with Pope Leo, despite the criticisms he had for the pontiff earlier in the week. Pope Leo has said he has a moral duty to speak out against war and called President Trump's threat to attack Iranian civilization unacceptable. Before leaving for Las Vegas, the president said he believes he is stopping Iran from developing into a nuclear power and falsely claims that Pope Leo is advocating for Iran to have a nuclear weapon.

7:34If the Pope would allow Iran to have a nuclear weapon, you can't do that. Meanwhile, Poblio is marking the halfway point in his four-nation tour of Africa with a day focused on encouraging Cameroon's young people. Democrat Annalilia Mejia has won the special election in New Jersey's 11th congressional district. Mejia, backed by Bernie Sanders, beat Republican Joe Hathaway with just under 60 percent of the vote to fill the House seat. She spoke to MS Now on her win. I'm feeling great. I'm so thrilled to have the opportunity to represent the great people of New Jersey's 11th congressional district.

8:13Mahia is set to serve the remainder of Democratic former Representative Mikey Sherrill's term. Sherrill resigned from the seat in November after being elected governor of New Jersey. New York City Mayor Zoran Mamdani revealed his child care plans and called on organizations in the city to get involved. Mayor Mamdani says the initiative addresses immediate needs of child care in the city, but also looks down the road to what else might be needed. To those people who want to help, I say the Child Care Action Fund is your way to get involved. This fund will help us build the infrastructure necessary to make universal child care accessible to every New Yorker who needs it.

8:51Mayor Mamdani says so far more than$3 million of$20 million needed has been raised for his free child care initiative this year. Global news, 24 hours a day and whenever you want it with Bloomberg News Now. I'm Michael Barr and this is Bloomberg, Karen. Thanks, Michael. Time now for our Bloomberg Sports Update. And for that, we bring in John Stashauer. Thanks, Karen. The NBA play in begins tonight with two games. Orlando hosts Charlotte. The winner then plays Detroit. Golden State visits Phoenix with the winner moving on to play Oklahoma City. The NBA playoffs begin tomorrow. So do the Stanley Cup playoffs on the last day of the regular season.

9:24Edmonton's Connor McDavid had four assists. he won the scoring title for the sixth time. Meanwhile, Alex Zvezkin, who had another strong season at age 40, says he expects to return to the Washington Capitals for a 22nd season and not retire. That's your Bloomberg Sports Update. Stay with us. More from Bloomberg Daybreak coming up after this. You need to make a huge presentation in an hour. Adobe Acrobat uses AI to take all your documents and generate a presentation with a single click. Build slides quickly and streamline the process. Need a last-minute pitch deck? Do that with Acrobat. Need to level up your presentation design?

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12:19Coast to coast on Bloomberg Radio, nationwide on Sirius XM, and around the world on Bloomberg.com and the Bloomberg Business App. This is Bloomberg Daybreak. Good morning. I'm Nathan Hager. With less than a week until the two-week ceasefire ends between the U.S. and Iran, President Trump sounding optimistic a deal could get done before then. But the president has a warning for Tehran if it doesn't happen. I would say the fighting, if there's no deal, fight or resume. President Trump at the White House yesterday. Joining us this morning from Dubai is Bloomberg News Middle East managing editor, Oner Ant.

12:54Oner, good morning. Is there substance behind the president's optimism? Good morning. Well, there appears to be substance behind the president's optimism. Having said that, it's important to note that Iran has yet to comment on recent claims by Trump that a deal might be very soon, might be announced fairly soon in its own words. The main sticking point, as far as our reporting goes, is the enriched uranium stockpile in Iran. It's still not clear what the fate of that material will be and whether Iran will be able to commit itself to a future where it doesn't enrich any more uranium. That is at the heart of this agreement.

13:46But yes, the signaling from Trump and the U.S. administration is very much that they are getting ready to wind down this war. That is a central sticking point, as you mentioned. I think we heard the president say to reporters at the White House yesterday that there doesn't even need to be a 20-year limit on Iran's nuclear program. What do we know about what Iran could agree to when it comes to its nuclear ambitions? Well, we know that Iran actually did agree to some kind of a moratorium, albeit much less than a 20-year-long one, on its nuclear enrichment activities. And again, this brings us to the very same question that we just discussed.

14:31This is at the heart of the disagreement. Trump doesn't even seem to be keen on the idea of a long-term moratorium. He wants to finish this matter once and for all, so to speak. Well, on the one hand, there is a chance that he is trying to do what any successful salesman or negotiator would do, which is to start with an unacceptable offer and try to find a compromise, a common ground that can be acceptable to both parties. But we haven't really seen any indication from Iran that it is ready to forego its nuclear enrichment activities for an indefinite period, because this is for them not just about the strategic value of such activity, but it is an inalienable sovereign right.

15:16It's a matter of national sovereignty. So it's very hard to imagine a scenario where Iran makes a commitment to not have any nuclear enrichment activity in the future at all. Now, to your point about the complications here, I think we've heard from Gulf Arab and European allies saying that it could take up to six months to reach a longer term deal and that the ceasefire between the U.S. and Iran should be extended to that amount of time. When it comes to what the president is talking about, could this be sort of like the deal before the deal? That's a great way of putting it. Yes, I think what President Trump has in mind right now sounds like a deal before the deal.

16:01Gulf officials, as well as those in Europe, think that the differences between the two sides over the main issues remain just simply too wide to bridge in such a short period of time, despite Trump's optimism. Now, the seeming inconsistency between what Europeans think and what Trump says may be down to the fact that, as you said, there is a chance that Trump sees the next point as a possible interim deal that will make sure that neither the US nor Iran go back to fighting, because they both seem to have had enough of it, for lack of a better expression. And in the meantime, they try to bridge their differences over the main issues, including the nuclear.

16:51And that, according to officials in Europe and Persian Gulf, can take up to six months, obviously can all be over in a much shorter period of time, but the expectation is six months.

17:27Bloomberg 92.9 in Boston, and nationwide on Sirius XM Channel 121. Plus, listen coast-to-coast on the Bloomberg Business app, now with Apple CarPlay and Android Auto interfaces. And don't forget to subscribe to Bloomberg News Now. It's the latest news whenever you want it, in five minutes or less. Search Bloomberg News Now on your favorite podcast platform to stay informed all day long. I'm Karen Moscow. And I'm Nathan Hager. Join us again tomorrow morning for all the news you need to start your day right here on Bloomberg Daybreak.

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