Will the U.S. or Iran Decide When the War Ends?

SPEAKER_1 (0:00)

Exchanges on Navigating Macro Uncertainty. Exchanges on the Forces Shaping Global Markets. For the sharpest analysis on finance, business, and the economy, count on Exchanges, the Goldman Sachs podcast. Listen now.

Luke Vargas (0:18)

President Trump promises a quick end to the Iran War, as Iran pledges to fight on. Plus, why Americans aren't likely to see pricier natural gas, even if the rest of the world is?

Ryan Dezember (0:30)

All things being equal, the American consumer should be pretty well insulated from the shock, unlike folks in Europe and Asia.

Luke Vargas (0:37)

And the rest of the day's news, as Chinese exports blow past analysts' forecasts, and the Nasdaq embraces tokenized trading. It's Tuesday, March 10th. I'm Luke Vargas for The Wall Street Journal, and here is the AM Edition of What's News, the top headlines and business stories moving your world today.

President Trump says he is looking for a quick end to the war in Iran, saying it will be over very soon after some of his advisers privately urged him to look for an exit plan amid rising energy prices and concerns that an extended conflict could spark political backlash. We report that Trump has been briefed on some polling about the war, and that some in his inner circle have fielded calls about the midterm elections from nervous Republicans. White House Press Secretary Caroline Levitt denied that report, saying it was full of crap, that Trump's aides were focused on ensuring that the war is a tremendous success, and that Trump will be the one to decide when it's over. Here he was at a press conference yesterday evening in Florida.

SPEAKER_5 (1:43)

Mr. President, you said the war is, quote, very complete, but your defense secretary says this is just the beginning. So which is it, and how long should Americans be...

SPEAKER_6 (1:51)

Well, I think you could say both. The beginning. It's the beginning of building a new country. We could call it a tremendous success right now as we leave here, I could call it, or we could go further, and we're going to go further.

Luke Vargas (2:06)

Journal Middle East correspondent Jared Malsin told me that whether the war ends very soon, or is just beginning, is partly in Iran's hands.

Jared Maslin (2:15)

Well, the Iranians have said essentially that they will decide when the war is over with the Islamic Revolutionary Guards Corps saying yesterday that they would be the ones to decide when, for example, to reopen the Strait of Hormuz, which at the moment is at the center of the crisis around Iran and very likely has something to do with why Trump said what he said yesterday. One fifth of the world's oil passes through the Strait, and right now it's all but closed due to Iranian attacks and threats. Even if the administration decides to stop bombing, they would face the challenge, number one, of reopening the Strait of Hormuz and easing pressure on oil markets, and more generally of easing the security threat from Iran across the region. And they're going to be reckoning with a region that's really been transformed by this. If they decide to stop bombing in the coming days, for example, the Iranian regime would still be in place. It would have survived the military offensive. And from the Iranian's perspective, they have a lot of incentive to continue to use the leverage they have over energy markets to try to insure their own survival because Trump began this war by saying that he wanted to change the Iranian regime. Israeli Prime Minister Benjamin Netanyahu has been consistent in saying that that's what he wants. That's something that he reiterated this morning. And so that's how the Iranian regime is going to view the conflict as a fight for their survival.

Luke Vargas (3:52)

Well another potential factor in the war's trajectory is the state of global energy markets. We spoke yesterday about the big run-up and pullback in oil prices, which remain around $90 a barrel this morning. But for much of the world, natural gas prices are being just as closely watched. And it's clear why. Because while US prices are actually down on the year, they remain considerably higher in Europe, even after double-digit declines today. As I discussed with reporter Ryan Dezember, there's a reason gas is responding differently to global volatility than oil and why Americans are likely to be spared some of the pain of higher prices seen elsewhere.

Ryan Dezember (4:29)

Well, after the US and Israel started bombing Iran, the Strait of Hormuz became sort of a no-go zone for ships carrying oil, as we know, but also liquefied natural gas from the Persian Gulf. That's about 20% of the world's supply. So what we saw was international natural gas price that surged, while in the US, they rose, but by a relatively small amount. Last week, benchmark futures in the US rose 11%. And that compares with more than 50% over in Europe. So we see this big gap where America's domestic supply is sort of cushioning the blow from this.