The week’s news agenda is likely to be dominated by the conflict in the Middle East, as the war appears to be spreading beyond Iran’s borders, following the surprise US-Israeli bombing campaign launched at the end of last week.
Middle East flare-up
After a tumultuous weekend that saw Israel and the US launch military attacks into Iranian and Lebanese territory, the war looks to be causing extensive disruption to trade.
Starting on Saturday (28 February), the US and Israeli armed forces hit multiple locations in Iran with aerial attacks. Among the casualties were Iranian Supreme Leader Ali Khamenei and multiple other high-level leaders in the intelligence and security ministries.
Iran and their allies in Lebanon, Hezbollah, have responded with attacks on US allies. Hundreds are reported dead or injured, many of them civilians.
US President Donald Trump said he would continue the bombing campaign for as long as “uninterrupted throughout the week or, as long as necessary to achieve our objective of PEACE THROUGHOUT THE MIDDLE EAST AND, INDEED, THE WORLD.”
He also warned there would be “likely more US deaths” with at least three American service personnel already reported killed in action and many more wounded. He promised to “avenge” any US soldiers killed in the war. Iran has also promised revenge for the death of its leader.
The conflict has already spread beyond Iran to the United Arab Emirates, Bahrain, Kuwait, Lebanon and an RAF base in Cyprus.
Trade ripples
Key trade routes across the continent have been impacted by the ongoing war.
Shipping giants Maersk, CMA and Hapag-Lloyd have confirmed they will not be transiting through the Strait of Hormuz and Suez Canal until further notice.
Emergency surcharges have been imposed on other routes around the Gulf, while oil prices spiked as the industry expects significant ongoing disruption to vital routes between Europe and the Middle East.
The UK Maritime Trade Observatory has reported multiple attacks on vessels around the coastline of Oman and the United Arab Emirates, although no casualties are yet being reported. Additionally, several oil infrastructure projects have reportedly been targeted.
Airlines like Emirates SkyCargo, Qatar Airways Cargo and KLM have halted services across the region.
Forwarders told the Loadstar that the delays are likely to be grim, with rates skyrocketing and the price of oil likely to add to costs.
Spring Statement
In domestic news, UK chancellor Rachel Reeves announces her Spring Statement tomorrow (3 March).
The Guardian reports that Reeves is aiming to project “calm and confidence” after a rocky week for the government. The event is expected to be a quiet affair with insiders briefing that there will be no last-minute policy announcements.
Instead, her statement is expected to last for 20 minutes and mostly be a response to economic forecasts from the Office for Budget Responsibility, as the Labour government tries to reinforce its message of “dull and steady”.
Also in the headlines
- The decision to allow UK exports to Armenian firm Rydena is under review, according to the Guardian. Reporting had suggested that UK goods sent to this company could be passed on to Russia for its illegal war in Ukraine. Daniela Turiccki, export controls advisory lead at the Chartered Institute of Export & International Trade, warned that businesses should be “extra careful about who they are selling to”
- India and Canada have announced a series of deals, including a critical minerals agreement, after a ‘reset’ meeting in New Delhi between Canada’s Mark Carney and India’s Narendra Modi
- The government says that the first shipment of tariff-free UK beef has arrived in the US, as business and trade secretary Peter Kyle celebrates the benefits of the UK-US Economic Prosperity Deal
Other dates for your diary:
- Monday: UK’s manufacturing Purchasing Manager’s Index released
- Tuesday: Trump hosts German chancellor Friedrich Merz; also, a total lunar eclipse
- Wednesday: Manchester mayor Andy Burnham delivers speech on ‘Manchesterism’
- Thursday: China’s National People’s Congress plenary session opens. Also, World Book Day.
- Friday: Deadline for submissions to low value imports (LVIs) consultation; also, Conservative Party’s Spring Conference begins
- Saturday: Six Nations rugby tournament continues with England v Italy and Scotland v France
- Sunday: International Women's Day. First round of presidential elections in Colombia
