The Week: Is There A Path To Peace?

Summary

Newscast (BBC News)

Episode: The Week: Is There A Path To Peace?

Date: March 27, 2026
Participants:

• Adam Fleming (host)
• Chris Mason
• Lise Doucet
• Stephanie Flanders (Bloomberg)

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Episode Overview

This episode of Newscast brings together BBC journalists and economics expert Stephanie Flanders to discuss the rapidly evolving conflict in the Middle East, especially the US-Iran crisis, its diplomatic maneuvering, military realities, and profound impacts on global economics and geopolitics. The team analyzes the week’s developments, the difficulty of negotiations, the asymmetric strategies in play, market reactions, and the reshaping of global alliances and priorities.

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Key Discussion Points & Insights

1. Are There Real Negotiations? The US-Iran "Peace" Process

[03:03 – 05:12]

• Lise Doucet explains the differing narratives: President Trump claims "strong talks with Iran", while Iranian officials continue to say there are "no talks" or negotiations.
• First confirmation that a "15 point plan" has been put forward by Trump’s favorite envoy, Steve Witkoff, via Pakistan as intermediary.
• Both US and Iranian proposals remain "maximalist," with "zero chance they will be accepted by the other side."

  "If you look at those two 15 points from President Trump's team, five points from Iran teams, they are maximalist demands. There is zero chance that they will be accepted by the other side." — Lise Doucet [04:32]

2. Asymmetric Warfare and Narrative Control

[06:28 – 10:46]

• Iran’s Strategy: Despite severe military losses, Iran retains sufficient capacity for missile and drone attacks, relying on horizontal escalation and narrative manipulation, including meme warfare.

  "With the zero percent that Iran has, it is still able to fire missiles into Israel...The way this war is, and this is every war, unfolds on two levels. It unfolds on the ground, but it also unfolds in terms of the battle for the narrative. And this is the first artificial intelligence war." — Lise Doucet [07:25]

• Weaponizing Global Chokepoints: Iran leverages the Strait of Hormuz; their low-cost drone and mine warfare creates disproportionate global economic impact.

  "Iran is benefiting from the rise in the oil price and its oil is going through. It's just other US allies' oil that's not getting through." — Stephanie Flanders [09:38]

• Markets are volatile; unclear and changing signals from the White House deepen the sense of uncertainty.

3. Military and Political "Unpreparedness"

[10:21 – 12:15]

• The US appears improvisational in force deployment, contrary to claimed foresight; Iran’s layers of command, the "Mosaic system," counter assassination attempts.

  "They seem to be making it up as they go along...It really sounds like they just were not prepared for this option." — Lise Doucet [10:47]

• Despite internal and external pressure, the Iranian regime is not cracking; leadership remains intact, with only isolated reports of minor unrest.

4. Intelligence Superiority and Regime Durability

[13:32 – 14:58]

• Israeli intelligence enables high-profile targeted assassinations, but the Iranian regime’s structure proves resilient.

  "...there’s a sustainability, a durability to the regime. Is that a contradiction?" — Chris Mason [14:07] "We don’t have a...What we know is they're still standing...the decentralized 'Mosaic system,' so when the war started, they wouldn’t always have to refer to Tehran." — Lise Doucet [14:28]

5. Economic Fallout: Oil, Inflation and Growth Projections

[15:57 – 20:37]

• Despite severe shocks, current financial panic does not match reactions to the 2008 crash or Covid—a "slow burn" economic challenge.

  "Our yardsticks...have been somewhat distorted by the events of the last few years...but...it's the sort of worst of all kind of shocks, in a sense, because it doesn't feel as dramatic." — Stephanie Flanders [16:26]

• UK faces one of the lowest G7 growth forecasts—stark reversal from recent optimism.
• Policy response will be far more targeted; "massive state interventions" (furloughs, stimulus) not likely to be repeated.

  "Support will be targeted. It won't be universal, that recognition, trying to make an argument about what is fair and what is affordable." — Chris Mason [19:00]

6. Strategic Consequences: Winners and Losers

[21:02 – 25:50]

• The US intervention is widely seen as counterproductive—hurting allies while ironically empowering Iran and Russia.

  "If you raise the oil price...you help Iran and...you are helping Russia significantly at a time when probably the economic pressure on Russia a few months ago was greater than it's been at any time..." — Stephanie Flanders [22:12]

• Russian Advantage: Now able to sell oil at a premium; fiscal woes eased.

  "Russian oil now either has no discount or is actually able to charge a premium. Sold some oil to India this week at a premium over the world price." — Stephanie Flanders [22:48]

• Ukraine adapts: Zelensky seeks Gulf cooperation and investment for drone defense, as the Ukraine war is overshadowed but still critically impacted by energy market shifts.

7. UK and Europe: Defense Priorities and New Missions

[25:50 – 28:12]

• UK faces rising commitments: to the Arctic, Persian Gulf (Strait of Hormuz), and Russia's "shadow fleet" of oil tankers.

  "They believe...that is legal where British forces could board Russian ships...if they are deemed to be illegally transporting...Russian oil." — Chris Mason [27:09]

8. Hybrid Warfare and Influence Operations

[30:00 – 30:44]

• New findings: Evidence of Iranian cyber-activity—posts about Scottish independence dropped 25% after Iran's internet went down.

  "...the day after Iran's Internet went down, the number of posts about Scottish independence dropped by a quarter." — Chris Mason [30:40]

9. "Wildcards", Gaskets, and Unforeseen Impacts

[31:00 – 34:25]

• Key risk: If the Strait of Hormuz remains closed, the cumulative economic shocks multiply.

  "It's not even...the intensity when it comes to the oil. It's the length of time. This is closed because that also means you have a backup backlog...So it's not exactly...the gasket that's going to blow. It's a slow burn." — Stephanie Flanders [32:41]

• The "Houthis wildcard": If they join in via the Red Sea, another vital energy route is threatened.

  "...there's an indication that the Houthis are going to join the fight. And then therefore it won't just be about the Strait of Hormuz, it will also be about the alternative routes which involve the Red Sea." — Lise Doucet [32:54]

• Unexpected side effect: Even helium shortages (critical for semiconductor industry) are tied to the chokepoint crisis.

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Notable Quotes & Memorable Moments

• "Both sides say, and they absolutely believe that they're winning." — Lise Doucet [07:49]
• "Iran has sanctioned the U.S." — Stephanie Flanders [09:10]
• "You could say it's environmental regulations [for boarding Russian ships], but there was just this uncertainty and fear about how Russia would respond...that threshold has been crossed because there's this desperation to have Russia not gain quite so much from this other conflict." — Stephanie Flanders [28:51]
• "When there’s a crisis and the pressure is building in the boiler, you can never predict which gasket is gonna blow where." — Recalled by Adam Fleming [31:13]

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Timestamps for Important Segments

| Timestamp | Segment | |-----------|---------| | 03:03 – 05:12 | Status and reality of US-Iran negotiations, 15-point plan | | 06:28 – 10:46 | Asymmetric warfare, Iran’s resilience, narrative strategies | | 12:15 – 15:02 | Regime stability after protests, targeted killings, narrative disconnect | | 15:57 – 20:37 | Economic impacts: oil, inflation forecasts, policy responses | | 22:12 – 25:50 | How the war strengthens Russia, impact on Ukraine efforts | | 25:50 – 28:12 | UK/European defense commitments and “shadow fleet" | | 30:00 – 30:44 | Iranian online influence & Scottish independence meme | | 31:00 – 34:25 | Unpredictable "gaskets," threats to Red Sea routes, supply chain effects |

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Flow & Tone

• The discussion is marked by urgency, skepticism about official narratives, and humor to relieve tension.
• Pundits highlight the ambiguity and unpredictability of both the diplomacy and the economic fallout.
• The tone is conversational, occasionally wry, but always informed and grounded in on-the-ground realities and historical context.

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Takeaway

There is currently no clear “path to peace”; negotiations are riddled with contradictions and maximalist demands. The asymmetric capabilities of Iran and their focus on controlling key narrows like the Strait of Hormuz reshape military, economic, and political realities—often to the US and its allies' detriment. The spillover to Russian finances, Ukraine, and even UK politics demonstrates how the crisis is rewiring global priorities, with a strong sense that the world’s normal crisis-management playbooks are being left behind.

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Transcript

[Adam Fleming]

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[Chris Mason]

Hello.

[Adam Fleming]

Breaking news about a very important deadline. No, we're not talking about Donald Trump and Iran. If you would like to apply for tickets for CastFest, the podcasting jamboree we're doing at the Maida Vale Studios in West London on the 25th of April, we've extended the deadline for applications by a little bit, so if you fancy coming to see me, Chris and the others and some of our podcasting cousins making their podcasts in real life on that Saturday in April, then the instructions for applying for tickets are in the episode description of this very episode of Newscast, which, as usual at this time of the week is going to be our roundup of the momentous events of the week, which we recorded on Thursday night, which was broadcast on BBC1 after question time.

[Chris Mason]

Newscast, newscast from the BBC. Fat Boy Slim and me in the

[Adam Fleming]

classroom doing our violin lessons.

[Stephanie Flanders]

I was the tattletale in the class.

[Howie Mandel]

Can I have an apology, please?

[Lise Doucet]

I trust almost nobody that Daddy has

[Adam Fleming]

to sometimes use Strong language.

[Stephanie Flanders]

Next thing in Moscow, I feel Delulu with no Salulu. Take me down to Downing Street.

[Adam Fleming]

Let's go have a tour.

[Chris Mason]

Blimey.

[Adam Fleming]

Hello, it's Adam in the newscast studio

[Chris Mason]

and Chris in the newscast studio.

[Lise Doucet]

And Lise Doucet is in the newscast studio.

[Adam Fleming]

And joining us this week is Stephanie Flanders from Bloomberg.

[Stephanie Flanders]

It's a delight to see you all

[Lise Doucet]

and a delight to have you here.

[Adam Fleming]

Now, you launched that podcast Trumponomics, didn't you? Did you foresee oil heading towards, I don't know, $200 a barrel as a result of Donald Trump?

[Stephanie Flanders]

We have, you know, had plenty to talk about since Donald Trump came back to office. And that is just the least of it, I would say.

[Adam Fleming]

Right. Lots to discuss as the conflict in the Middle east enters its fourth week. Lisa, you and I have convened most days on various BBC programs, five live newscast to try and work out if there are negotiations between the Americans and the Iranians. Where have you got to after four days of trying to work it out?

[Lise Doucet]

Everyone's going to switch off from this program now because you've just said we've asked the same question for the last four days.

[Adam Fleming]

I mean, there has been a different answer every day.

[Lise Doucet]

Still don't have an answ. It's a difference of definition, but it's also a difference in the understanding of what constitutes diplomacy that President Trump has been saying for days, very strong talks with Iran and there are serious negotiations. And every day the Iranians say there are no talks and there are no negotiations. And I think what we hear from Iranians and others who are part of this mediation process because a lot of third parties involved is that there are no talks per se. But today we did get more details today. For the first time, we had a confirmation from Steve Witkoff, President Trump's favorite envoy, that they did put forward what he called the 15 point plan, which could be the basis of a peace plan. And we do know, and he confirmed that it was going through Pakistan and we think that is the main channel now, that Pakistan, of course, is Iran's neighbor. They have very good country to country ties despite strains every so often. And it does seem that the army chief who's a field Marshal Asumin actually knows the man that President Trump hints he's talking to or wants that there's talks already taking place with Mohammed Bagar Kabaloff, who is speaker of the Parliament and also has played key roles in all the main security institutions. So those proposals seem to be going back, back and forth. So I think it's important that a channel has been opened. But let me finish by saying, if you look at those two 15 points from President Trump's team, five points from Iran teams, they are maximalist mans. There is 0ch that they will be accepted by the other side. And quite frankly, they really don't. They don't, they don't seem to set the stage for serious negotiations.

[Adam Fleming]

And Stephanie, the world markets seem to react to every kind of microsecond of extra news or analysis about what these negotiations or talks or back channels could be also in quite wild ways as well.

[Lise Doucet]

So Ben and I are confused. Are the markets confused?

[Stephanie Flanders]

I think they're confused. It depends. I mean, I think what the markets have stopped doing is listening to every word that comes out of Donald Trump's mouth, because that is certainly something entertaining. Tends to be vary even in the same sentence, let alone in the same day. We did see oil prices go back up though, today because I think there was a general feeling that there is nothing, to Lisa's point, there's nothing that's coming out of the White House or our attempts to back up what's being said by the White House that suggest that an agreement is anywhere close. And I think, you know, with the Iranians particularly focused on will there be a ceasefire they can actually believe in as opposed to a period of pause before they then get attacked again, all the urgency seems to be on the US side. And that's kind of the extraordinary thing about where we are. Iran seems to have an incentive to have this war continue amazingly, despite the attacks on its country, because of being able to take the global economy hostage via the Strait of Hormuz because of all these things that we know about. And it's the US that really wants it to stop.

[Adam Fleming]

And lis the meme, the diplomatic meme I keep seeing from observers is that Iran is playing a weak hand very well.

[Lise Doucet]

It's extraordinary, isn't it? And we this is what the military would call an asymmetric war. President Trump and his Secretary of War. Today, he nailed the plaque onto the the Defense Ministry to say, take us seriously. I am the Secretary of War, I'm not the Secretary of Defense. And he pumps out all the statistics and that 92% of the Navy's gone. And President Trump has been saying even from the very, almost the very first days of the war, that the war has been won. We've completely destroyed. There are 100% of the military assets of I.R. iran are destroyed. And yet, as they say on social media, with the zero percent that Iran has, it is still able to fire missiles into Israel, lower rate, but it's still firing. And to fire into, into Gulf states. The way this war is, and this is every war unfolds on two levels. It unfolds on the ground, but it also unfolds in terms of the battle for the narrative. And this is the first artificial intelligence war. So both sides are trollers in chief as well. And the memes, people are saying that Iran should be heading Netflix now. The kind they're doing Lego animations, they did movies. But more seriously, both sides say, both sides say, and they absolutely believe that they're winning. So President Trump says we've defeated them. And you know what Stephanie said? They're desperate for a deal. And Iran says we've defeated the United States and we're desperate for a deal. Iran has done what they call horizontal escalation. And it is quite astonishing that they have suffered extraordinary losses. That seems factual of their ballistic missile program. Military bases, a whole range of leaders assassinated, both top commanders as well as top officials. But they have changed this from what they themselves described as an existential battle when it started President Trump and Prime Minister Netanyahu talking very clearly about regime change. And now it's a battle for the Strait of Hormuz. They have weaponized the world's critical waterway. So they are now fighting a completely different war on a completely different terrain.

[Stephanie Flanders]

And I just. And that is their one card. So I think it's not the case. They've always had this one potentially strong card. And what this conflict has taught them is that they can deploy it incredibly effectively and incredibly cheaply. I mean, when you talk about asymmetry and we tend to say the other phrases, you know, they're on the wrong side of the US Are on the wrong side of the cost curve. But you know, the drones, it's very

[Lise Doucet]

Bloomberg, the drones, we love your Bloomberg phrase.

[Adam Fleming]

In other words, because the Iranian drones

[Stephanie Flanders]

are very cheap to dwell off down the cost. So take even the mines, right. What's the cost to the US of actually reopening the Strait of Hormuz? Well, potentially enormous. And more than any of the number of troops that are currently on the way there could potentially do. How many mines does Iran need to actually create a minefield in Strait of Hormuz?

[Adam Fleming]

Potentially none, because the threshold of risk for the insurance companies that insure the tankers is very, very high.

[Stephanie Flanders]

And the drones are very easy to produce and cheap to produce and can be produced. Very non military looking sites, you know, very Normal kind of industrial factories. So then you have to broaden out the number of things that you're hitting in Iran. So the asymmetry both in the ability to withstand the war but also the cost of it is quite extreme. And by the way, Iran is benefiting from the rise in the oil price and its oil is going through. It's just other US allies, oil that's not getting through. It's effectively Iran has sanctioned the U.S.

[Adam Fleming]

well, yeah, because if you're China or India, you can have a tanker going through the Strait of Hormuz.

[Stephanie Flanders]

Yes.

[Adam Fleming]

Which suggests there aren't any mines there.

[Stephanie Flanders]

Well, they're being escorted, they're being pointed, which ways to go. Right. Unclear what's which.

[Lise Doucet]

You know, brings us back. I mean, we can bring Chris in here because, you know, secure Starmer's hesitation to join this war. Because this discussion again raises that absolutely crucial question about why did they go to war and what was the planning for this war? Because even though President Trump continues to say, oh, we knew this was going to happen in the Strait of Moves, the way every day they seem to eye roll from, from blue like they

[Stephanie Flanders]

knew this was going to happen.

[Lise Doucet]

They just seem, I mean, I know this sounds really cruel, but they seem to be making up as they go along, bringing thousands more marine from, from Japan, sending in troops from the 82nd Airborne Division. It really sounds like they just were not prepared for this option.

[Chris Mason]

Yeah. And the Prime Minister, whilst facing difficult questions about UK defence budgets and where UK defence assets are deployed, whether it's to the Mediterranean or to the high north. The Prime Minister Helsinki at the moment talking to the Joint Expeditionary Force and a big conversation that feels very January, which is about kind of the high north and Greenland and where we were just a couple of months ago. In terms of the conversation that was then circulating around President Trump, he is absolutely of the view that he feels he strategically called the UK's position. Right. In terms of those big questions that remain live now about what the end game is, what the objective is. And then the wider question that circulates now, picking up on the conversation this last couple of minutes, which is that Iran outwardly remains powerful and influential in terms of shaping this conflict and the knock ons for the, for the global economy with the wider question, I guess for newscasters, Lee, sov, the sustainability, seeming sustainability of the Iranian regime able to continue prosecuting an argument around the Straits of Hormuz and then. And also its longevity, which seems fair. Is that fair?

[Lise Doucet]

Well, there's. So the big question is you know, ever since, and especially this year, where you had this major protest wave across Iran and everyone said was the regime, what's going to happen to the regime? Can this bring down the government? But there were no mass defections. There were not. There were no cracks. And there certainly wasn't collapse. And so far, we haven't seen that. We haven't seen any defections. There have been some reports that some police officers haven't been showing up for work, but there's so far no cracks. Cracks, certainly not collapse and certainly not capitulation. And remember, even before the war was started, President Trump mused to his envoy, Steve Witkoff, that he was curious as to why Iran hadn't surrendered. Because facing with even before they used it US Military might, which the Iranians then trolled him, the foreign minister put a flag up and saying, we are Iranian. That was the first indication of President Trump's misunderstanding of Iran. And it seems to have this capacity. It has been preparing for years for this. They knew this war was coming. So the layers of succession are layers deep. Today they now the Israelis assassinated. Their intelligence is stunning. So today they got the head of the Navy. They had got the head of Navy intelligence and other senior officials in the Navy.

[Adam Fleming]

And also the Israelis pitched that operation to take out those, those officials as a way of opening the Strait of Hormuz. So rather than an airstrike on a. On a facility, it's an airstrike on individual people making decisions.

[Lise Doucet]

And they're so. And it's like you get Caroline Levitt, who's the White House spokesperson last night, and again, they're incredulous because they think, we're America, we're the best army in the world. And Caroline Levitt goes, but they've been defeated. How come they're not. How come they're not giving in? They don't understand. They really. There's a huge gap in understanding and a huge gap in trust.

[Chris Mason]

Is there an apparent contradiction there? Because on the one hand, it would appear that Israeli intelligence is incredibly good and therefore incredibly close to the levers of power within Iran and where particularly significant figures are geographically so they can be targeted. And yet there seems to be a sustainability, a durability to the regime. Is that a contradiction?

[Lise Doucet]

I don't know. I think we probably should also exercise humility. We don't have a. What we know is they're still standing. We don't know how hard it is for them to communicate. We've heard that and they've talked about this, that they decentralized the command and control, it's called Mosaic system, so that when the war started, they wouldn't have to always be referred to Tehran because then it would be difficult to communicate. And whenever there's a threat from President Trump or there's an attack, Iran immediately retaliates, which again, says they haven't lost completely their capacity.

[Adam Fleming]

And two people died in Abu Dhabi today, didn't they? Yes, As a result of the interceptors.

[Lise Doucet]

And finally, they all know they have a bullseye on them. There was a report saying that the Americans had taken Foreign Minister Abbas Arakchi off the kill list and taken this Muhammad Bagar Kali Bah off the kill

[Adam Fleming]

list so that they'd be available for negotiations.

[Stephanie Flanders]

But this disconnect, as you say, about sort of seeming to make it up as it goes along, I mean, Israel seems to be much clearer, and I think possibly because of its greater intelligence, is believing that this is going to be a long and has to be a continued attack. I mean, you partly wonder with the extent of the intelligence penetration they have, whether they're just waiting for a Mossad agent to be declared the supreme leader, which is surely a matter of time. But when you hear Donald Trump talk about it, it's this extraordinary thing of like, well, we could have talked to him, but, well, the Israelis will probably kill him, too. There's this. The lack of. He seems relaxed with a degree of lack of coordination that the US has just never seen in any conflict.

[Adam Fleming]

But going back to the economics, I'm thinking of big shocks to the world economy that we've all lived through. So the financial crash of 2008, you could feel the panic. You could see the panic in Canary Wharf, the COVID lockdowns. You could feel the panic about, oh, our government's gonna be able to borrow any money anymore. This is serious. The full SC Russian invasion and the surge in oil prices, you could feel panic. I'm not feeling panic from the world financial system, even though I keep being told it's really bad.

[Stephanie Flanders]

Our yardsticks for these things have been somewhat distorted by the events of the last few years. And we would probably think this was pretty dramatic if we hadn't lived through all the things that you just described in recent past. But, I mean, I think it's the sort of worst of all kind of shocks, in a sense, because it doesn't feel as dramatic as something like Covid, where people accept this is going to be a major hit and people are going to be hurt. But unfortunately, in real time, if you're Rachel Reeves, you're looking at an awful lot of your forecasts going out the window. We're even seeing it, the sort of, the very short term inflation forecast. You have these now cars which predict just what this month's inflation is going to be and they're about half a percentage point higher for March than they were at the start. So we've already seen that immediate impact from the oil price, I think from the kind of volatility you've seen in markets, from the uncertainty, from, from the change in our expectations around interest rates, all of which dates to the attack on Iran four weeks ago. That translates into probably half a percentage point off growth and a non negligible chance of a recession for the UK this year, which we've seen people talk about this week. So that is a. It doesn't feel maybe dramatic enough for you?

[Adam Fleming]

I know, I don't want it to be true. I'm just using it as an indicator for how worried I should as a human being. But, Chris, it was, was it the OECD today, Stephanie will correct me, doing their growth projections. Britain is now predicted to have the second lowest rate of growth in the G7 group of the largest countries. I remember not so long ago, Keir Starmer's target was to have the fastest rate of growth. So I mean, that's literally been turned on its head.

[Chris Mason]

Yeah. And I think what's striking, looking at that OECD report, is not, it's not surprising that they are saying that this is going to have an economic impact, will have an economic impact on the biggest economies in the world. But looking at, through the UK prism, the disproportionate, seemingly disproportionate impact here and. Yeah, and then the challenges for Rachel Reed and actually picking up, Stephanie, on your point about the, the framing of the, of how we look at this in the context of say the last, well, five years, 10 years, 20 years, we've got used to, haven't we, in a way that we wouldn't have done if they hadn't come at the frequency that they have of these moments where we say, oh, a Chancellor's projections are fed into the shredder. Things are looking grim again, a non negligible potential for a recession. How might a government step in, what might be affordable? We've seen it this week, haven't we, with the expectation management. We've heard from the Prime Minister and from the Chancellor.

[Adam Fleming]

Oh, yes, because Rachel Reeves has tried to rewrite the expectations. What the Government will do?

[Chris Mason]

Well, because I suppose because of the recent, apparently once in a. Whatever it is century or whatever events that we've had, whether it be the pandemic or the full scale invasion of Ukraine, where the House been these in relatively recent history and therefore in the memory, the sort of folk memory of the electorate, big, not just big, massive, massive state interventions to help with energy bills or to pay wages during the pandemic with furlough with massive consequences for the public finances, ongoing challenges for the treasury and for Rachel Reeves and then her saying this week, and we've had this sort of. Of dripped, if you like, into the national conversation over the last two or three weeks from the Prime Minister and the Chancellor, but then said explicitly by the Chancellor this week that support will be targeted. It won't be, she hopes need to be universal, that recognition, trying to make an argument about what is fair and what is affordable. But it is also true, the Chancellor's acknowledged this, that, you know, the spring statements of a few weeks ago came what, three or four days after the Iran War, war started and where any assumptions that there might have been about where things were economically are being rewritten. And at just the point, as we said on newscast the other day, that the likes of Rachel Reeves and Keir Starmer were tentatively in public, a bit more so in private, but tentatively in public, sounding a bit more positive about at least some economic indicators. And now you look at this OECD stuff and indeed more widely, what's on Stephanie's screens and all the rest of it, and it's, it's grim.

[Stephanie Flanders]

The only upside is the OECD is almost always wrong.

[Adam Fleming]

Also, we could actually have the lowest rate, the G7, rather than the second lowest.

[Lise Doucet]

Yeah.

[Adam Fleming]

Also, Stephanie, I'm just thinking again back to the recent past and that you can't fight the old conflicts in the modern day, but politicians usually a bit behind the curve, aren't they? They sit, they talk a good talk about, oh, this is what we're going to do, and then the world throws more stuff at them and they have to be more ambitious or do more or.

[Stephanie Flanders]

I mean, I think the trou. The difficulty about this is that it is, at least from a lot of perspectives, inexplicable. I mean, it's one of the actual. The US decision to do this for all the reasons that we've discussed and given all of the sort of gaming of different scenarios that US administrations had done, that security and intelligence people in the US had done for decades, more or less since the Iranian revolution, every time they gained out some kind of intervention in Iran. It had ended with, or even begun with the closing of the Strait of Hormuz, an enormous uncertain conflict, costs and difficulties, and that's why successive administrations hadn't done it. So I think you'd be forgiven. It's true that whenever Donald Trump sort of sends troops and aircraft carriers to a region, he tends to want to use them. But the idea that you were going to have this kind of severe attack, I think just seemed improbable to people because, not least because, I mean, we may get onto this. It was just so counterproductive in terms of some of the other things that are happening. If you raise the oil price, well, for a start, you help Iran and it's getting a lot of its oil through. You hurt some of your biggest allies if they're not able to get their oil through, although Saudi Arabia is able to send quite a lot of oil through the Red Sea in the other direction. And you are helping Russia significantly at a time when probably the economic pressure on Russia a few months ago was greater than it's been at any time since it invaded Ukraine. So if you're the treasury, it was sort of reasonable to at least hope, anticipate that you wouldn't have this degree of confidence conflict so fast and so suddenly.

[Adam Fleming]

And is it helping Russia because Russia, which was a bit of a pariah as an oil provider, is now Putin's the go to guy because he's got loads of it.

[Stephanie Flanders]

I mean, before this, it was looking at a major discount on the oil it was selling because of the sanctions. And that was meaning it was looking at a big budget deficit. The cost of the war becoming a complete war economy was really weighing on the financial sector. Ukraine was actually making some progress on the battlefield, even though of course Ukrainian cities were suffering enormously from lack of he and other things. There was again some cautious optimism from the Ukrainian side. That's all completely reversed now. The oil, Russian oil now either has no discount or is actually able to charge a premium. Sold some oil to India this week at a premium over the world price. Its budget deficit, if these oil prices continue for any length of time, more or less disappeared. And of course, you've also got the eyes of the world almost entirely and including most of this podcast, talking about Iran and certainly much less talk in the US of potentially doing anything to help Ukraine. So this is. It has had a. Probably that's the biggest sort of consequence which, you know, other countries who are supportive of Ukraine now have to try and deal with. And Ukraine is trying to deal with on itself.

[Adam Fleming]

But we are seeing lots of bits of the world sort of rewiring in real time. And so another example of that, Lisa, is Volodymyr Zelensky, Ukrainian president in Saudi Arabia today, almost looking like he's going to do a deal with the Saudis to help them defend themselves from Iranian drones because he is now the Mr. Go to Guy for drones.

[Lise Doucet]

Yes, he's very clever, very, very strategic thinker. He realizes that the, the drones that are now being fired at Gulf states are actually Iranian made Shahid or Shahid drones. And so he offers the support. They're the experts now on how to deal with the drone attacks because Russia brought so many of them from Iran. And so he's the go to guy on providing. So they've already sent technical advisors to many GU states. We don't know exactly what he's discussing in Saudi Arabia. He might like to ask for a bit of money, a bit of help, saying we're all part of the same. The war, the Ukraine war has now expanded. I'm on your, please keep me on your radar too. He will offer something and I'm sure he's hoping to get something in return.

[Stephanie Flanders]

And I think we don't know what was being discussed in the meeting, but they would definitely also like to have some investment from the Gulf nations in their domestic, domestic arms, in the defence industry, which has done extraordinarily well in developing the drones, but that would also clearly help support the war effort. And then at the same time they're also on the other front because the Russian oil is now being sold on the market so easily. We saw this week for the first time in a while serious Ukrainian drone attacks on Russian export terminals. And at least by some estimates it's about 40% of Russia's physical export capacity has been wiped out by those. So that's quite, that's bad news for us as well because that's less oil in the world market and probably higher prices. But it shows the Ukrainian desperation to try and respond on these two fronts to this change in the situation.

[Adam Fleming]

Well, that's the Ukrainians responding to the different financial incentives you were just talking about and Chris talking about the rewiring. We're now learning maybe what the future demands on the British Navy might be because today you've got Keir Starmer in Finland with this Joint Expeditionary Force, which is his group of like minded northern countries in Europe. They're talking about upping their commitment to the Arctic to, as you said earlier on, assuage Donald Trump's concerns about the Arctic from January. But then you've also got Keir Starmer and Emmanuel Macron on the phone to each other about a marine task force for the Strait of Hormuz. When there is a peace deal to get, get things moving again, that seems like two quite big new commitments. Oh, and by the way, we're going to be boarding more 4 Russian dodgy oil tankers in British waters as well. Yeah, that's three new missions just today.

[Chris Mason]

Quite. And so it's no surprise that whenever I speak to anybody in broadly in defense circles, by the way of almost any political affiliation, but at the moment, clearly those around the Labour government talking about how important it is when they get the chance, and at the moment there is quite a lot of chance, but maintaining that conversation about how our defence posture in the coming decades, in other words, beyond any particular government, is going to be in a very different place and trying to win that argument. And that's clearly not an easy argument to win when you're also talking about NHS pressures. Oh, and by the way, some more strikes coming up in England in the, in a, in a couple of weeks time and questions around welfare and the bill. So the Prime Minister in Helsinki, as you say, with this wider discussion and then this argument that we heard John Healey, the Defence Secretary, making this morning around what's known as Russia's shadow fleet again with getting to how Russia transports oil around the world. And I think quite a significant, it's not happened yet, but as and when it does, it'd be quite a significant moment, this decision taken, signed off by the Prime Minister that they believe is, that is legal where British forces could board Russian ships passing through, for instance, the English Channel if they are deemed to be illegally transporting sanctions, mentioned Russian oil. But how you go about doing that and the special forces that you are potentially putting in harm's way in so doing and then are these boats, these ships transported to British ports, etc.

[Adam Fleming]

Etc.

[Chris Mason]

Anyway, that is now a live possibility. We're told by the Ministry of Defense that it's likely to happen soon. So that becomes a thing down the track because either it does happen with who knows what consequence, or it doesn't happen. And the question will be, well, why not? Because these ships are still, still moving around.

[Lise Doucet]

I wonder whether he's talking to Donald Trump about that, because that's what they were doing in the run up to the Venezuela operation.

[Chris Mason]

And that particular ship that had changed it from memory had changed how it was flagged on its route and of course, you can see these things happening some way off because they don't travel wildly fast, but then you can make a decision about what you're going to do and what response you might get if you bought a particular boat, etc.

[Stephanie Flanders]

I think that was the point. So my understanding is that was why there'd been so much concern before this. There was a rationale for boarding, which you could also say, could, you know, you could say it was environmental regulations. There's lots of sort of reasons you could potentially board, but there was just this uncertainty and fear about how Russia would respond. And it just show, if it does happen, to your point, just shows that that threshold has been crossed because there's this desperation to have Russia not gain quite so much from this other conflict.

[Schwab Advertiser]

Right.

[Adam Fleming]

And least it's speculation. But we do have a fair idea about the Russian playbook. How might Russia respond against Britain if British commandos are boarding a Russian shadow ship in the English Channel? If there is an escalation?

[Lise Doucet]

I don't know, what is the playbook? We seem to be having a whole new library now of things, things that are happening. We don't.

[Adam Fleming]

Well, drones or the Scandinavian airport standoff.

[Lise Doucet]

I would imagine that they won't, they won't take it lightly. And it's one of those things where you have to not just do something, but be seen to be doing something in order to establish deterrence. It's all about deterrence, isn't it? To ensure it doesn't, it doesn't. Doesn't happen again.

[Chris Mason]

Adam, can I throw in just an extra little sidebar curveball?

[Adam Fleming]

A sidebar curveball?

[Chris Mason]

Well, in the. In the sort of multi layered overlapping elements of all of the stories that we've been kicking around, whether it be Iran and Russia. There was a report published this week into alleged foreign interference in UK politics by a guy called Philip Rycroft, a former civil service 7. There was one particular line in it which I was just reminded of in the conversation which I just pulled up on my phone around all of this, asked for examples of what Iran has been doing. He said, this is Philip Rycroft, that the day after Iran's Internet went down, the number of posts about Scottish independence dropped by a quarter.

[Stephanie Flanders]

Yes.

[Chris Mason]

So just throw into the mess in the.

[Lise Doucet]

What they've been up to.

[Chris Mason]

Yeah, in the.

[Adam Fleming]

And that's not because Iranian citizens are weirdly interested in devolution.

[Chris Mason]

That's an unlikely explanation. Yeah. So just throw that into the mix and the swirl of all of this.

[Stephanie Flanders]

Yes, just.

[Chris Mason]

Yeah. Anyway, the newscasters Might.

[Adam Fleming]

Ponder and sevi. Well, I was gonna give you the last word. Cause I remember chatting to a diplomat in my previous life who'd worked for a European Prime Minister for a long time, and he said something that really stuck in my mind. He said that when there's a crisis and the pressure is building in the boiler, you can never predict which gasket is gonna blow where. And it's unusual things that take people by surprise. Is there a particular thing you at or that you might think, oh, that'll be the thing that will pop. That maybe we're not. We're not taking into account. I mean, it's. I'm getting you to predict the future now.

[Stephanie Flanders]

Well, you're. So you're getting me to what's the really unpredictable thing that no one's expecting.

[Adam Fleming]

Yeah, go ahead. No, no, no.

[Stephanie Flanders]

That is the classic thing.

[Adam Fleming]

No, but is. Or is there something that is sort of.

[Stephanie Flanders]

It's actually, I think when it comes to the economy and the oil price and whatever, actually the straight of Hormuz, which is a very obvious thing. You know, it really is important how long that stays partially or effectively closed. I remember in the first week of the conflict we had on Trumponomics, we talked with the chief emerging market economist and also Javier Blass, who's this fantastic commodities expert and commentator. He just said, they've got four days to reopen the straight.

[Adam Fleming]

Right.

[Stephanie Flanders]

And if they can't reopen it in four days, that's when you start something. And of course, that four days has long since passed. We've already passed the sort of short, sharp shock aspect, but it's the length of time. It's not even sort of the intensity when it comes to the oil. It's the length of time. This is closed because that also means you have a backup backlog. You know, how quickly can you get everything through? Would have been passing through all of this time. So it's not exactly an exciting sort of, whatever your phrase, the gasket that's going to blow. It's a slow burn.

[Lise Doucet]

I'll add a curveball blower, gasket. Just when we're talking guess when everyone is getting off their maps to find. And this drives us mad. The Straits. It's not the Straits.

[Adam Fleming]

It's one singular.

[Lise Doucet]

The Strait of Hormuz. What? There's another, you know, joker in the pack or curveball, whatever. The Houthis have been on standby. Remember a few years ago, the Americans were and the British were bombing the Houthis because they had been blocking the Red Sea. And from what we understand is Iran has said hold fire to the Houthis, don't get involved yet. And now there's an indication that the Houthis are going to join the fight. And then therefore it won't just be about the Strait de Formus, it will also be about the alternative routes which are involve the Red Sea.

[Stephanie Flanders]

And Saudi Arabia is getting about three or four million dollars a day, barrels a day through the Red Sea. So it's actually managing to get out a lot of what it was previously, what it has been producing. So that would be with both of

[Chris Mason]

those things, you think, how long does it take to then get back to a level of confidence where things can flow normally?

[Stephanie Flanders]

But this is the point. So you have this card that has now been placed played and Iran has learned that it can play very cheaply once it's been closed, once it can be closed again. So there is a legacy of this conflict for future presidents, let alone Donald Trump, let alone the rest of us.

[Adam Fleming]

My version of the gasket was going to be that the best joke on the new British version of Saturday Night Live, which was on sky last Saturday, was about a shortage of helium. And that's a reference to the straight of Hormuz being closed because so much of the world's helium, helium goes through there. And you don't just need helium to do funny gags with your voice or to blow up someone's balloon for a birthday. It's used in semiconductors, lots of important industrial processes. Stephanie, thanks for coming in.

[Stephanie Flanders]

Great to be back.

[Adam Fleming]

Leis, good to see you for what feels like the 900th day in a row.

[Lise Doucet]

Always a pleasure.

[Adam Fleming]

And Chris, good to catch up with you too.

[Chris Mason]

Thanks, Adam.

[Adam Fleming]

And that's all for this episode of Newscast. Thank you very much for listening. We'll be back with another one very soon. And just a reminder, if you'd like to apply for tickets to CastFest at the BBC Meida Vale Studios on April 2025. The details of how to do that are in the episode description and there will be another episode for you to listen to coming very soon.

[Stephanie Flanders]

Bye bye.

[Chris Mason]

Newscast, Newscast from the BBC.

[Newscast Outro Announcer]

From one newscaster to another, thank you so much for making it to the end of this episode. You clearly do, in the words of Chris Mason, ooze stamina. Can I also gently encourage you to subscribe to us on BBC Sounds? Tell everyone you know and don't forget, you can email us [e-mail] or if you're that way inclined send us a WhatsApp on 440-33-0123, 9480. Be assured, I promise we listen to everyone.

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