Two-Week Iran Strike Deadline, Israel Home Cameras Hacked, UK Car Theft Crisis
20:32 Share

This is an iHeart Podcast. Every business starts with an idea. How can you go from daydreamer to industry leader? Amazon Business accelerates your journey. With smart business buying, get everything you need to grow in one familiar place, from office supplies to IT essentials and maintenance tools. Amazon Business takes the buying experience you know and love from Amazon, plus tools that help you save costs and make insights-based decisions.

Ready to bring your visions to life? Learn how at AmazonBusiness.com. For enterprise organizations, managing all your food needs is a tall order. But with Easy Cater, you get a single workplace food vendor with the tools and resources to make it easy. Giving teams across your organization an easy way to order from a huge variety of restaurants, all on one platform. All while consolidating your corporate food spend so you can control costs.

streamlining billing and payment and simplifying reporting. Easy Cater, your business tool for food. To learn more, visit easycater.com slash podcast. Bloomberg Audio Studios. Podcasts, radio, news.

This is the Bloomberg Daybreak Europe podcast, available every morning on Apple, Spotify or wherever you listen. It's Friday the 20th of June in London. I'm Caroline Hepke. Coming up today, the White House says President Trump will decide within two weeks whether to strike Iran. Satellite images examined by Bloomberg show Iran is racing to get its oil out into the world.

Plus, Britain's growing car theft crisis, pitting manufacturers against organised gangs as thieves use sophisticated technology to steal luxury vehicles and ship them overseas. Let's start with a roundup of our top stories. The White House says that President Trump will make a decision on whether to strike Iran within the next two weeks.

Trump has publicly mused about the U.S. joining Israel's strikes on Iran in recent days, but the latest statement suggests that the American president still wants to secure a deal on Tehran's nuclear program. Here is his press secretary, Caroline Levitt. I have a message directly from the president, and I quote...

Levitz declined to elaborate on Trump's timeline, including how he views the chances of success in any further talks with Iran.

U.S. Secretary of State Marco Rubio and U.S. Special Envoy Steve Witkoff met the U.K. Foreign Secretary David Lammy at the White House on Thursday. That comes after Prime Minister Keir Starmer called on President Trump to keep the door open to resuming talks on Iran's nuclear program. Lammy will now join the French and German foreign ministers for

talks with Iranian Foreign Minister Abbas Arragchi in Geneva later today. Israeli warplanes have continued to strike military targets in Iran as a missile launched from Iran hit an Israeli hospital on Thursday. Meanwhile, authorities in Tehran have imposed a nationwide internet and telephone blackout.

telling civilians it's necessary to prevent Israeli cyber attacks. The blackout follows a series of highly accurate Israeli strikes, which prompted Iranian officials to urge citizens to delete WhatsApp from their phones. The government claims that despite the app's end-to-end encryption, it was being used to transmit user information to Israel. In a statement cited by the Associated Press, WhatsApp denied the claim, describing them as, quote, false reports

The Iranian state could use as an excuse to block its services, quote, at a time when people need them the most. Well, cybersecurity experts in Israel say that Iran is tapping into private security cameras to gather real-time intelligence. As Bloomberg's Ewan Potts reports, the revelation exposes a recurring problem with these devices, one that has emerged in other global conflicts.

Earlier this week, a former Israeli cybersecurity official issued a stark message on public radio. Turn off your home surveillance cameras or change the password immediately. The warning was later backed by Israel's National Cyber Directorate, which confirmed to Bloomberg that internet-connected cameras are increasingly being targeted as part of Iran's war planning. Similar tactics were employed by Russia following its invasion of Ukraine.

And while researchers have been sounding the alarm about vulnerabilities in security cameras for over a decade, there is now increasing evidence that for countries at war, these systems are being exploited as a critical weak point. In London, I'm Ewan Potts, Bloomberg Radio. So that was Ewan Potts there. Well, oil prices slumped after President Donald Trump's comments, which eased fears about an imminent attack from the U.S.,

Bloomberg analysis of Iran's oil facilities suggests that the country is racing to put its oil on global markets. Oil analyst Tankertrackers.com estimates Iran exported a daily average of 2.33 million barrels per day in the five days since the attacks began. That is a sudden 40% jump. Bloomberg's James Walcock has the story.

The oil storage tanks on Kargh Island have floating roofs. So, when you can see a shadow on satellite images of the reservoirs at Iran's main export terminal, they're not quite full.

Over the past 10 days, they've gone from being partly full to being filled to the brim, ready to ship out. That's despite exports going up in the same period. That's one of the bits of data analysis oil traders are using to conclude Iran is trying to rapidly get oil out of the country as its conflict with Israel ratchets up. In London, James Woolcock, Bloomberg Radio.

Well, now turning our attention to the UK, the Bank of England held interest rates steady but took a more dovish view than expected and warned about the conflict in the Middle East. Three out of the nine rate setters on the central bank's monetary policy committee voted for a cut. Deputy Governor Claire Lombardelli says that the Bank of England is keeping an eye on the oil price.

The events in the Middle East are tragic and they are deeply worrying. As you'd expect, we are monitoring carefully those events and the impact that those will have. We've seen oil prices, for example, increase since the attacks.

Lombardelli added that she expected interest rates to be on a gradually downward path. Traders slightly added to bets on further UK interest rate cuts, pricing another two-quarter point reductions in 2025. The EU is making progress in trade talks with the United States, according to one of the region's top officials. That's as the administration's tariff cut-off date approaches. Bloomberg's Tiwa Adebayo has more.

With just 19 days to go before President Trump's scheduled tariff deadline, the European Union says it's making headway with negotiations. The bloc is pursuing a compromise but is ready to take measures to protect itself should discussions fall through. That's according to Economy Commissioner Valdis Dombrovskis, who played down the importance of, quote, so-called reciprocal tariffs at a meeting of euro area finance ministers this week.

The EU is facing the prospect of 50% levies on nearly all US exports if an agreement isn't reached in time. Meanwhile, central banks in Switzerland, Sweden and Norway cut rates this week, highlighting a shift in policy as officials brace for tariff fallout. In London, Tiwa Adebayo, Bloomberg Radio.

Now, the UK has recorded its hottest day of the year so far, with temperatures hitting highs of 32 degrees. Amber heat alerts are still in place across the whole country until Monday morning. Highs of 33 degrees are expected on Saturday, with forecasters predicting that central and eastern England will be the worst affected. Aidan McGiven from the Met Office set out his expectations for the next few days.

31 Celsius by Friday and then into the weekend 32 Celsius. Not just talking about London and the South East, it will be widely mid to high 20s across the whole of the UK by Saturday.

Aidan McGiven speaking there. The NHS is also bracing for increased pressure during the heat wave period. So those are our top stories for you this morning. In terms of the markets then, as President Trump seems to be taking a beat on whether to involve the US in Iran, WTI crude futures are up but

Brent crude slumping 2.1% this morning. In terms of the S&P 500 returning after the Juneteenth holiday yesterday, stock futures are down two-tenths. Euro stocks, 50 futures, though, are up seven-tenths of 1%. This after we did see European stocks fall for a third session yesterday in a row. The dollar at the moment, Bloomberg Dollar Spot Index is weaker two-tenths of 1%. The Asian equity session has seen a rebound for the KOSPI, for the Hang Seng, for the MSCI Asia-Pacific.

Of course, uncertain times tend to push investors to be kind of warier of stretched valuations like the ones that we've seen in the US. So actually, the MSCI Asia Pacific Index has been one of the winners so far this year. That's a look at where we are in the markets. Now, in a moment, we'll bring you the latest on events in the Middle East, plus the UK car theft crisis that is pitting manufacturers against organised crime.

But there is another story that I was really interested in reading this morning. I wanted to share it with you. So this is Parmi Olson, who's been writing about...

the rush to create AI toys. Why is this so interesting? Mattel announced this week that it was preparing to bring the magic of AI to its toys through a partnership with OpenAI, obviously the makers of ChatGPT. Olsen is concerned about what these toys will do to kids' social skills, and she comes armed with some very interesting evidence from GROK,

which is a cuddly toy made by Curio Interactive, which is a startup in San Francisco, which she gave to her seven-year-old daughter. They record almost all the verbal interactions between the child and the toy. And Parmi Olson points out the deference, the constant validation are absolutely saccharine.

and she also cites character ai which is a popular chatbot app too to make the point about dependency of young people whether these toys which are kind of programmed for positivity are going to remove the rough and tumble of real human relations i just it really got me thinking um about this kind of era maybe of sycophancy of the dangers really present dangers of of

AI and what they do to social interactions as of course we're also learning that Australia is getting closer to that social media ban for under 16s hefty fines for firms that breach that so they've been doing research and analysis into that in Australia but that was one of the stories that I was reading about this morning got me thinking about our wider social interactions and what we think of those I'll put a link to Parmi Olson's story in our show notes today

Well, it does appear that President Donald Trump is going to decide whether the US will strike Iran within two weeks, even as Israel and Iran are engaged in missile strikes, in cyber warfare, and Iran has imposed this blackout on internet and phone lines. Joining me this morning is Paul Wallace, who manages Bloomberg's Middle East and Africa coverage to discuss. Paul, thank you so much for being with me today. President Trump has framed the decision to

bomb Iran as his and his alone. He seems now to have rushed right to the brink and suddenly hesitated now. Why? Hi, Caroline. It does seem like he has hesitated now. It's unclear. Essentially, the message from the White House is that he is allowing more time for diplomacy, essentially allowing more time for Iran to back off somehow. It's unclear what he actually wants from Iran. The most obvious thing is

it would be Iran saying it will no longer enrich any uranium on its own territory. This has been a big thing. And this was a key sticking point in the nuclear talks between the US and Iran in the previous two months. Iran insists it must be allowed to enrich some uranium for civilian purposes like medical use and fueling nuclear power plants. Trump

and Israel and many, many people in Washington do not want any enrichment at all. So that could be something. But then Trump this week has also called for Iran's surrender. I mean, maybe the enrichment issue would be enough to classify as surrender in his point of view. But

either way, he does seem to want to wait a little bit longer for diplomacy to happen. Iran's foreign minister is meeting his counterparts from France, the UK and Germany in Geneva today. It's unclear. No one from our reporting from European sources, it doesn't sound like they're overly confident that this meeting can result in something that pulls America back

from military action totally, but nonetheless, it will be an important meeting and perhaps the type of thing that will make Trump decide against military action if Iran comes back with something he's satisfied with. But of course, there are civilian casualties mounting. So how strong does the Iranian regime look right now? How long does Israel keep up its campaign? Yeah.

Exactly. There are civilian casualties mounting. It's hard to tell how many in Iran at this stage. The official tally stands at 224, 224 deaths. Iran says those are mostly civilians, but that total hasn't been updated for about three days now. So it's probably substantially higher. In Israel, 24 people have been killed. That toll hasn't actually risen

again for about three days, but that's more of a sign that Iran's missile attacks on Israel, while still very dangerous, are waning a bit.

But in terms of the Iranian government's weakness, militarily, it looks very weak right now. It's lost control of its airspace, certainly over most of Western Iran and the capital, Tehran, and its key strategic sites like nuclear facilities. So in that case, it really...

does look to have taken a heavy beating from Israel in the past week. There aren't really signs of, let's call it mass panic. Well, there are signs of panic in Tehran and people trying to leave and people trying to leave big cities, but there aren't signs of, you know, mass unrest against the government, no sort of huge protests or anything like that.

so far from what we can tell. So in that sense, that's a plus from the Iranian government. But certainly a lot of people are already saying whatever happens now, whether the US goes in with strikes or it doesn't, things have changed for the Iranian government and things can't get back to normal one way or another. It's going to have to change its governing system somewhat because it does look incredibly weak right now.

Indeed. And we've been reporting on Iran rapidly increasing clandestine oil exports too. A word on the worries, the risks to oil shipments, to the oil price. Brent crude futures are about 10% higher than they were a week ago. That is significant. Yeah.

It really is. And since Hamas's attack on Israel on October the 7th, 2023, the thing that markets seem to be most concerned about was that conflict spreading to a direct way

war between Israel and Iran. And we came close to it last year in April. And then in October, they exchanged direct missile fire on one another. But on both occasions, it was sort of one and done. This is now a war. As you said, it's gone on for a week. It looks like it's going to go on longer.

Iran, if it chooses to lash out, has the ability to cause turmoil in world oil and gas markets. It can attack oil and gas tankers going through the Strait of Hormuz. It can attack oil and gas facilities in places like Saudi Arabia and

the UAE, which it has done in the recent past via the Houthis, the proxy militant group that it backs in Yemen. So that's what's really causing oil traders to fret. Yeah.

Paul, thank you so much for being with me this morning and taking us through what is happening in the Middle East. Paul Wallace, who manages Bloomberg's Middle East and Africa coverage. Thank you so much. For enterprise organizations, managing all your food needs is a tall order. But with Easy Cater, you get a single workplace food vendor with the tools and resources to make it easy. Giving teams across your organization an easy way to order from a huge variety of restaurants.

All on one platform. All while consolidating your corporate food spend so you can control costs. Streamlining billing and payment and simplifying reporting. EasyCater, your business tool for food. To learn more, visit easycater.com slash podcast. Thriveint can help you plan your finances for the people, causes, and community you love. What makes Thriveint different? Financial services and generosity programs are combined to help you build a financial roadmap for the future.

while also creating opportunities to give back along the way. Visit Thrivent.com to learn more.

Now I want to turn our attention to the UK. Britain has a growing problem and police are struggling to deal with it. Car theft in the UK hit a 15-year high with almost 130,000 vehicles stolen in the year ending March 2024. It's something that Bloomberg's UK business editor Jamie Nimmo has been writing about. Good morning, Jamie. Morning. How are you feeling about the pandemic?

How are all these vehicles actually being stolen? I mean, forgive me, I thought the tech was amazing and this wasn't meant to happen, was it? Yeah, you're right. I mean, we think of movies and TVs and picking locks and stuff. It doesn't happen that way. But now it's modern technology like signal jammers where the fob's inside the home and they sort of cut the signal off effectively and it drives away without the alarm going off. There's all sorts of tech like that. That costs thousands of pounds. That's not cheap to get. You have to find that on the dark web or

somewhere else. So yeah, it's that sort of tech that means they can break in now. And so it does sound like the vehicles being stolen, it's on something of an industrial scale. Who do we think is stealing all of these vehicles and where are they going? Yeah, it's not joyriders, that's for sure, because it costs so much to actually steal them in the first place. These are organised gangs and the carmakers and police are making more and more noise about this, the fact that more needs to be done because, you know, this could be funding terrorism. We don't really know because it's such a

such a big thing now. These are going abroad, out on shipping containers, earning them millions and millions of pounds and costing insurers something like £640 million last year. So it's a big problem. And it's widely recognised also that police don't really have a grip on these thefts. I mean, your story follows an officer who did manage to get some stolen vehicles, which

What else is being done to address this? Yeah, so he's in a unit that's actually funded by industry because the Home Office pooled funding during austerity because they classed it as a lower priority crime than others like burglary where the sort of person is in actual, you know, immediate harm. But that's part of the issue. They recently acknowledged the problem the government has set up a new partnership with

but it's basically just one guy sort of helping to coordinate the police, the car makers and others. That's funded by Jaguar, Land Rover and Toyota, the Home Office as well, and police. But that's only one element. And they admit that more needs to be done and sort of joint effort. One thing the government has done is they said they are going to outlaw

signal jammers. So you'll get a five-year prison sentence just for possessing one, because there's no other reason for having one, they say. So that will come into effect soon. I mean, it has got a lot of attention in the UK, hasn't it, this issue? And it goes to something a bit wider, I think, as well. We've covered on this programme, you know, mobile phone thefts, shoplifting, even the kind of low levels of convictions for really serious things like rape.

there is a political danger, isn't there, in the public kind of seeing this as a crime that goes unpunished and that is sort of industrial? Yeah, you're right. It goes, you know, when they think of other things like mobile phone theft, they'll probably know someone who's had their phone stolen. They'll see videos on social media and read stories about it. And yeah, ultimately, they'll look at the government and go, what are you doing about it? I mean, the other issue is that it

people spend a lot of money on their cars. So, they will look at the car makers too and go, what are you doing about it? You mentioned the amount that's being put into new tech. They are constantly putting millions and millions of pounds into upgrading that technology. The issue is, so are the criminals, because these are organized gangs that have the money to actually get ahead. So, it's a game of cat and mouse. As soon as they solve one problem, there's another one to be fixed. So, it's

It's a constant battle for them as well. But yeah, they're getting the blame just as much of anything. Jaguar Land Rover, especially for Range Rovers being stolen. I think people have read those stories about insurance premiums going up and everything. So it's not a victimless crime as well. Insurance premiums are going up across the board for everyone because of this.

This is Bloomberg Daybreak Europe, your morning brief on the stories making news from London to Wall Street and beyond. Look for us on your podcast feed every morning on Apple, Spotify and anywhere else you get your podcasts. You can also listen live each morning on London DAB Radio, the Bloomberg Business App and Bloomberg.com.

Our flagship New York station is also available on your Amazon Alexa devices. Just say Alexa, play Bloomberg 1130. I'm Caroline Hepker. And I'm Stephen Carroll. Join us again tomorrow morning for all the news you need to start your day, right here on Bloomberg Daybreak Europe.

For enterprise organizations, managing all your food needs is a tall order. But with EasyCater, you get a single workplace food vendor with the tools and resources to make it easy, giving teams across your organization an easy way to order from a huge variety of restaurants, all on one platform. All while consolidating your corporate food spend so you can control costs, streamlining billing and payment and simplifying reporting.

EasyCater, your business tool for food. To learn more, visit easycater.com slash podcast. Every business starts with an idea. How can you go from daydreamer to industry leader? Amazon Business accelerates your journey. With smart business buying, get everything you need to grow in one familiar place, from office supplies to IT essentials and maintenance tools.

This is an iHeart Podcast.