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Welcome to the Daybreak Asia podcast.

I'm Doug Krishnner. There certainly have

been tremendous swings in the oil

markets over the last 24 hours. Now, the

situation in terms of the war with Iran

has been dynamic in both words and

actions. Early in the Asian session on

Monday, WTI crude oil rose to nearly

$120.

And that in turn prompted G7 finance

ministers to say they were ready to take

any steps necessary to support global

energy supply. Well, then Monday

afternoon in the US, President Trump

told CBS News the operation with Iran is

very far ahead of its initial four to 5

week time frame. And Trump went on to

say he's considering taking over the

straight of Hormuz. Now, the president's

remarks to CBS came after the oil market

closed in New York. However, the equity

market was still open and share prices

staged a pretty dramatic turnaround. The

S&P 500 ended higher by around 8/10en of

1% after having been down 1 and a.5%.

For a closer look, let's bring in

Bloomberg Stevenchinsky. Steven is team

leader for the Asia Energy Group and he

joins us from Singapore. Give me your

sense of what you've been observing in

in the oil market lately.

>> You know, I think what we've seen is a

lot of anxiety. A lot of anxiety because

we're in unknown territory. The street

of Hormuz has never been shut for this

long before. Um it's been over a week.

Likewise, we're starting to see output

cuts from Kuwait, um Saudi Arabia, as

well as the UAE, um ADNOS, uh their

their large producers also adjusting

supply. So, all of that together is

putting us into an area where the market

has never had to deal with this before.

And the big unknown is how long does

this conflict continue for? It's really

unclear after Trump's statements um

whether this is going to be a quick

reversal or if this is something that

could continue for several more weeks or

a month. Now the market is betting that

Trump um is going to perhaps be able to

wind this up relatively quickly. Um he

made some comments over the last 12

hours stating that um lots of the

operations are done and effectively the

US has has won and there's more winning

to be done. Um but he also wants to

provide some guarantees for the market

as well. Um all that together um is a

lot of lip service whereas the market is

waiting for actual action. Um Brent

opened this morning in Asia 10% lower

which indicates that there is some of

that anxiety has been easing but as long

as the straight of Hormuz remains shut

it provides about 1/5if of global

seaborn oil supply and if that doesn't

open again quickly then potentially you

could see oil prices rise again if this

doesn't get resolved. Is it not

important to point out in terms of the

context of this story that right now

there's essentially a global glut in

oil?

>> That's a really good point and I think

that's part of the reason why um it's

only been in the last few basically in

the last 24 hours where we saw that

spike in oil prices and then fall again.

Last week the market was relatively

subdued. While prices were rising there

was some anxiety. You do have to

remember like you said that we are

facing a glunt. OPEC plus is has been

adding more supply. US oil output has

been very strong. There have been other

producers outside of the Persian Gulf

area that have been adding more um oil

and barrels into the market. And because

of all of that, you're seeing a much

different sort of market today than

potentially would have seen if it were

2022, for example. In 2022, you saw a a

really large reaction to Russia's

invasion of Ukraine because the market

was much tighter. Um now there is an

expectation that they would be able to

weather this if the if they're able to

make a resolution or if this war in uh

war in Iran were to end relatively

quickly. Um but again uncharted

territory. It's unclear um how long the

straight of horm will remain shut but at

least in the short term the market will

be able to weather it. Um the only issue

is some of the people that have to pay

for it are those in the emerging world.

they're paying higher prices that they

usually can't afford and also to some

degree energy shortages.

>> So Stephen, is it your sense then that

volatility is likely to continue? We're

not out of the woods, so to speak, yet?

>> Oh, absolutely. I mean, I think um when

you talk to the traders, when you look

at the market action over the last few

days, volatility has come back and it's

actually I would say that the volatility

in the market had been subdued or

getting more subdued over the last few

years. There was a lot of volatility in

2022 with the war in Ukraine that sort

of began to ease as more oil entered the

market as the market became more

balanced. Now we're back in basically uh

the the the volatility era that we saw

about four years ago. And if you just

look at what happened over the last 24

hours, um oil prices spiked uh WTI, the

the US benchmark spiked to almost $120 a

barrel and then fell down into the $80

barrel range. it was a $38 range which

is uh quite unheard of and hearkens back

to some of the swings we saw um four or

five years ago and also during the co

era when when oil prices went negative

very briefly. So I think um because

there is so many unknowns, you're going

to see people latch on to Trump's

statements and words and also perhap you

know his deeds and what he actually does

and how the US acts and you're going to

see not just people bet on that but also

you know algorithmic trading um people

who are are are fear of missing out the

FOMO trade where they see prices right

and they want to jump into it. So I

think volatility definitely is is in the

cards at least for the foreseeable

future. Do we have a sense of whether or

not oil infrastructure in the Gulf has

been impacted at all? A lot of what

we've been describing here has to do

with the flow of energy on tankers, but

I'm I'm wondering about the

infrastructure per se.

>> That's a really good question because we

have spent a lot of time talking about

the straightfor.

But theoretically, if that were to, you

know, if there was a peace deal, traffic

could resume through the straight rather

quickly. Now, if there's any

infrastructure that's that's been

impacted, if there is any damage to

facilities, suddenly this isn't just a

quick fix. You can't just restart

everything. This takes more time. You

have to have maintenance. You got to

bring in new parts, spare parts, crews

from overseas to do the repairs. Now,

the good news is that there doesn't seem

to be any major damage to um key

facilities. There have been attacks on

facilities. The world's largest liqufied

natural export facility in Qatar uh had

been attacked and they had to shut that

plant last week. But Bloomberg analysis

of satellite photos shows that the main

facility remained intact and there was

no meaningful damage that we could see.

Um likewise, there's been a large

refinery in in uh Saudi Arabia that was

shut. And there have also been attacks

over the weekend uh strikes on Iranian

um uh oil uh infrastructure, the um

storage in particular, which again um

these are small depots that uh don't

necessarily affect the flow of oil. So

the market I think is still weighing

everything. But the risk, the fact that

there are still um tit fortat retalatory

strikes between Iran and its neighbors.

It has slowed over the last 24 hours,

but it's still that risk still exists.

The market is going to be worried that

maybe one drone or one attack does take

out a pipeline, a significant one, does

take out an export facility, and that

could um cause damage that would last

for weeks and months and not something

that can be quick rather fixed rather

quickly. In today's session, Asian

equities are breathing, I think, a

collective sigh of relief and moving

higher. Talk to me a little bit about

the vulnerability of many of the

economies in the Apac region that are

heavy oil importers and the risk of

higher inflation if this were to reverse

course oil prices were to move higher

once more and remain at at elevated

levels.

>> Yeah. No, I mean Asia is the biggest

buyer of of the oil and gas that comes

out of the Gulf. Now, we're talking

about global market, but when you're

actually talking about barrels and ships

moving the fuel, a lot of them go to

Asia. And while there are countries that

are better placed to weather the storm,

China has diversified their supply

enough both domestically and from other

trade partners that they are able to

handle this at the moment. um in the

developed world, I'm talking Japan um

and South Korea, they've got large oil

reserves and they have systems where the

government can subsidize to some degree

um oil and energy purchases or they pass

the cost down to consumers who are able

to deal with it because they're richer

um than the developing world um which

cannot necessarily um take on that cost.

So the shortages and those who are

likely to feel the the the biggest pain

even now with oil prices in the $80

range are um nations in South and

Southeast Asia. I'm talking Pakistan,

India, um Indonesia, um Vietnam and and

and Pakistan and Bangladesh. And you

know those countries are in particular

um very dependent on on oil and gas uh

from the region. Pakistan, I know I said

it twice, but it's just that important.

um they import uh 99% of their liqufied

natural gas from Qatar. Um and they've

that that supply has stopped which means

that they've had to curb um supply to

fertilizer plants. Um there are also

fears that LPG prices are rising um

quite quickly. Um LPG is a fuel used for

cooking and households. So it's a really

key um commodity. And on top of that,

you know, you just have the general

higher uh petrol prices. People are

running to the running to the pumps to

get their gasoline. Um, and while there

are no shortages because of the way that

the Brent prices and and the oil prices

globally are rising, it just means

higher costs for these consumers and

these consumers don't have the

disposable income that that those in the

developed world had and that it it has a

real strain on the consumer and the

economies uh for these countries.

>> So, at around 6 p.m. Wall Street time

Monday, uh, President Trump spoke with

reporters in Miami and he said he's

planning to wave oil related sanctions.

And I'm wondering whether that's code

for Russia and what impact might a

little bit more Russian oil have on

global markets.

>> You know, we actually already saw them

wave um uh some some sanctions on on

Russian oil. Um they waved uh basically

they gave waivers to India uh for oil uh

Russian oil that has been sanctioned

that's already on the water. It's a

one-mon waiver and they were able to

provide um basically an opportunity for

India, one of these hard-hit countries,

kind of suck up this this floating oil

that had already been out there kind of

you imagine it as like a floating

storage sort of situation and suck that

up. Now, that was helpful for for India,

but it's a bandage. um yes uh providing

uh you know with Russian oil potentially

flowing to other countries with that

being uh not impeded it does provide

some relief but it is a bandage um when

you look at the the amount of oil that

that travels through the straight of

Hormuz and the amount of oil that's

being cut from the major producers in

the Gulf um that it just is is so much

larger than than the waiverss that the

US can give or what Russia can provide

at least in the short term. So again,

it's it's a short-term solution, but it

doesn't um remove the the risk, the

volatility, and and uh quite frankly,

it's just still the elevated prices.

$80. Yes, we've dropped from the highs

um of earlier in the session on Monday,

but still uh above where we were before

the the strikes uh US and Israel strikes

on Iran began um about uh more than a

week ago.

>> That's a very good point, Stephen. Thank

you so very much. Bloomberg

Stevenchinsky. He is team leader for the

Asia Energy Group. Joining us from

Singapore here on the Daybreak Asia

podcast.

Welcome back to the Daybreak Asia

podcast. I'm Doug Krer. The Australian

government granted humanitarian visas to

five members of the Iranian female

soccer team. These players sought

asylum, citing fear for their safety

after they declined to sing the national

anthem during a match on the Gold Coast

last week. Now, Iranian state television

reportedly labeled these players as

traitors. That's where we begin our

conversation with Craig Foster. Craig is

a human rights activist and former

captain for the Australia men's soccer

team. Craig spoke with Bloomberg's Heidi

Strad Watts. Craig, you've been speaking

out on behalf of these women for some

days now. Tell us about your experience

in terms of how this all transpired,

particularly over the last 12 to 24

hours.

>> Yeah, the last day Haiti has been um you

know really very quickly evolving

situation which often happens once it

becomes not just public but uh you know

very visible around the world that

generally does two things. one, it can

provide some form of or level of

protection to the athletes because that

notoriety means uh that you know you've

got more people who might be able to

access them. You also if they do uh

leave Australia are either forcibly

removed or decide to return back to

Iran. We're hoping as well, which is why

these interviews are important, that

that notoriety and the eyes of the

global football community will be on

them, which might hopefully afford them

some level of protection. So, in the

last few days, we've been calling on the

Asian Football Confederation and FIFA to

step in. It was very clear that at least

some, if not all, of the women were

being placed in an environment of

coercion, silencing, and a lack of

safety and and uh uh lack of security

and very high risk. So, the AFC had a

responsibility, that's the Asian

Football Confederation, they should have

stepped in immediately several days ago

just to satisfy themselves that that

wasn't the case. We've seen this too

often with women athletes across a whole

range of sports and particularly in

football and it's clear that we don't

have the systems and protocols in place

to ensure that any of these women could

have um made you know an SOS claim if

you like through to a through a trusted

and confidential and private source. So

this is where we've landed. We've landed

in an environment where the Australian

government has had to intervene, has

been encouraged to intervene because of

the risk factors that are obvious. We

also know, you know, the systematic

persecution of high-profile athletes

who've spoken out against the Iranian

government in over a course of many

years. Uh, a lot of human rights

campaigns have been run. Human Rights

Watch and Amnesty and others have

identified those systematic patterns. So

that's why we've been so concerned about

the group. Uh and thankfully an

intervention by the Australian

government allowed five of them to not

only understand their rights but

exercise them. The urgent and immediate

situation today uh is to ensure that the

rest of the group are not removed from

Australia before having an opportunity

to understand their rights uh and to

make a personal decision about whether

they would like to exercise them.

In terms of what transpired overnight,

how useful, influential, impactful, or

just a matter of good timing was that

conversation with President Trump?

>> Um, well, the Australian government was

very aware of the situation prior to,

was already working on the situation,

um, and was actually on the ground at

least 48 hours ago. So, I can't answer

to that. I wasn't on the call. Uh what I

would say about these situations is we

need to be uh a little bit careful in

the overpoliticization of them. What's

clear with these women is that they've

already been in a deeply politicized

environment by the Iranian government

and the Iranian member federation. And

of course in the context of this

conflict in which Iran is directly

involved, so too is Australia and the US

um these women can very easily be placed

in a situation where the primary

consideration is not their safety. Uh it

can be actually using them you know as

uh a media tools if you like. We've seen

this, you know, multiple times uh

throughout football history and sporting

history. You know, the intersection of

sport and politics. Well, I shouldn't

say intersection. They're basically one

and the same. That's, you know, and

we've seen that in the way this Iranian

women's team have been silenced,

effectively held hostage in their hotel

uh in order that they couldn't speak to

the media or even access external

support. So from our perspective, you

know, as a former player, former chair

of our players association here in

Australia, the only consideration should

be the welfare and safety of this entire

group. That's what we're really focused

on. Um, I think there was no question

Australia was going to offer the women

asylum anyway, independent of any phone

call. It's the women who've shown the

courage here. It's the activists around

the hotel who've advocated, you know,

courageously for their rights. you know,

it's those people, I think, uh, you

know, who are at the center of this

story.

>> Craig, you've done so much activism and

within this space. Has it surprised you

that this sort of path to bipartisan

political support to public support has

been easier to to garner that attention

and that broader support because we know

that matters of asylum seeking, of

refugees, of immigration can be quite

difficult for Australia.

Yeah, that's a really good question. Um,

Australia, like many countries, has had

a kind of tortured relationship with the

concept of seeking asylum, uh, and of

the protection of vulnerable and

persecuted people. Um, and so, you know,

we've had a lot of, you know, public

kind of, uh, angst around those issues

and our record on providing protection

to people who seek it, um, is very

checkered, if you like. Um what we do

see repeatedly is you know a wonderful

sense of compassion and care from

Australians when particularly we see

women in trouble and that's important.

We should be very proud uh you know of

the response of the Australian community

to this moment. Of course we did grant

asylum as well and evacuated the Afghan

women's national team. Again there was

some political considerations around

that because Australia was involved in

that actual conflict and the like. Um,

nonetheless, sport is so powerful in

countries like Australia that it can

provide a different context to a group.

We saw this with the Hakim Malarabi

campaign back in 201819.

What saved his life was not the fact

that uh, you know, he was in a Thai

prison and we were able to secure his

freedom. He was saved largely because he

played football and so he was seen as

something more than just an asylum

seeker or more than just a refugee.

That's certainly the case here again. So

my hope is always that Australians and

other people around the world can

respond to these situations by saying,

well, if we feel strongly about this

group of women, we should feel strongly

about the rights of all women. That

includes other asylum seekers and

refugees, but it also includes all women

in conflict. Uh, and it's a good

opportunity for us in time because it's

still, you know, a live, you know,

critical situation. But in time, we

should reflect on, you know, all of

those issues. international law where we

sit in respect to that with Australia

because we should put no people at harm,

but it is fantastic that Australia has

responded to this group. We still need

to make sure that the remaining members

are safe. However, that was Craig

Foster, former captain of the Australian

men's soccer team, speaking with

Bloomberg's Heidi Strad Watts, bringing

you their conversation here on the

Daybreak Asia podcast.

Thanks for listening to today's episode

of the Bloomberg Daybreak Asia Edition

podcast. Each weekday, we look at the

stories shaping markets, finance, and

geopolitics in the Asia-Pacific. You can

find us on Apple, Spotify, the Bloomberg

Podcast YouTube channel or anywhere else

you listen. Join us again tomorrow for

insight on the market moves from Hong

Kong to Singapore and Australia. I'm

Doug Krishnner and this is Bloomberg.