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Trump’s War on Iran Threatens to Drive Up Oil Prices and Inflation
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By Kristin Broughton | WSJ Leadership Institute
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Good morning, CFOs. The economic fallout from President Trump’s war on Iran; the corporate playbook for reducing tariff bills; and layoffs at Block tap into fears of AI replacing jobs.
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An LNG tanker previously seen at a port in Qatar, one of the biggest exporters of liquefied natural gas. Associated Press
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U.S. and Israeli strikes against the Iranian regime and military threaten to upend the global oil market and send shock waves through the world economy.
The government of Qatar, one of the world’s biggest exporters of liquefied natural gas, urged shipowners to suspend maritime activities. Dozens of tankers diverted from the Persian Gulf in the early hours of the conflict. The U.S. Navy advised tanker companies to avoid nearby waters because it couldn’t guarantee their safety, according to an alert from an industry body.
President Trump said the U.S. had launched a major combat operation, with far broader objectives than strikes last year that targeted Iranian nuclear sites. The attacks risk sparking a wider regional war and greater economic disruption than the earlier conflict. Iran responded swiftly on Saturday, sending a barrage of missiles at Israel and U.S. military bases throughout the region.
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“Implications of this war could be wide because oil is a feedstock for so much of the global economy,” said Edward Fishman, director of the Center for Geoeconomic Studies at the Council on Foreign Relations. “You could see knock-on effects for monetary policy and inflation.”
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“A limited set of strikes could plausibly send oil toward $80 per barrel, while a longer conflict that causes disruptions to supply could send prices much higher—with a material effect on global inflation,” analysts at Capital Economics wrote in a note to clients.
More coverage:
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Content from our sponsor: Deloitte
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How Companies Can Manage Tariff Risks and Complexities
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A vigilant approach focused on compliance readiness and alignment with strategy is key to navigating ongoing trade and tariff uncertainties following the recent Supreme Court ruling. Read More
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Monday
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Earnings: EchoStar, MongoDB, Norwegian Cruise Line
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The Institute for Supply Management releases its Manufacturing Purchasing Managers’ Index for February.
Tuesday
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Earnings: AutoZone, Best Buy, CrowdStrike, On Holding, Ross Stores, Target
Wednesday
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Earnings: Abercrombie & Fitch, American Eagle Outfitters, Bath & Body Works, Broadcom, Okta
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ISM releases its Services PMI for February.
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The Federal Reserve releases the beige book for the second of eight times this year.
Thursday
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Earnings: BJ’s Wholesale Club, Burlington Stores, Ciena, Costco Wholesale, Gap, Marvell Technology
Friday
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The Bureau of Labor Statistics releases the jobs report for February.
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The Census Bureau reports retail and food-service sales for January.
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What Else Matters to CFOs
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Importers may not be able to escape a tariff but they can pay it on a smaller amount. Mario Tama/Getty Images
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A well-honed tariff-reduction playbook is giving businesses—and the lawyers who advise them—some confidence that they can deal with President Trump’s latest tariffs.
One of the most effective plays is reducing the reported value of goods companies bring into the U.S. Importers may not be able to escape a tariff, such as the global 15% rate Trump announced after the recent Supreme Court ruling, but they can pay it on a smaller amount. A legal way to do this has had such an impact that a bipartisan pair of senators wants to ban it.
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The WSJ CFO Council Summit
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This March 23–24, financial leaders will gather in Palo Alto for The WSJ CFO Council Summit to examine how CFOs are navigating market volatility, evolving trade and regulatory policy and the growing impact of AI on the future of the enterprise. Join the CFO Council and be part of the conversations shaping the future of finance and corporate leadership.
Request Invitation.
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Content From Our Sponsor: DELOITTE
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AI tokens: How to navigate AI’s new spend dynamics
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Organizations should manage AI as an economic system driven by unpredictable, token-based costs, requiring disciplined infrastructure choices, governance, and FinOps practices. Read more here
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The Wall Street Journal's CFO Journal offers corporate leaders and professionals CFO analysis, advice and commentary to make informed decisions. We cover topics including corporate tax, accounting, regulation, capital markets, management and strategy. Follow us on X @WSJCFO. The WSJ CFO Journal Team comprises reporters Kristin Broughton, Mark Maurer and Jennifer Williams, and Bureau Chief Walden Siew. You can reach us by replying to any newsletter, or email Walden at walden.siew@wsj.com.
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