00:00Oil is climbing as hopes of a quick breakthrough between the U.S. and Iran fade.
00:05Tehran says it will not soften its conditions after President Trump rejected its latest proposal
00:11to reopen the Strait of Hormuz.
00:13And the Iranian president told CBS rebuilding trust will require assurances from Washington.
00:20The United States needs to show that it does not intend to overthrow our government or our administration.
00:26Put yourself in our position.
00:28Imagine someone came and martyred your supreme leader and then not abide by everything you had agreed upon.
00:34What would be your reaction?
00:37It's not something that can be resolved that simply.
00:42Meanwhile, regional tensions remain elevated with Saudi Arabia's capital coming under attack on Saturday from Houthi militants in Yemen.
00:51And for more on this story, we're now, of course, joined by Bloomberg's executive editor for the Middle East and
00:56North Africa,
00:56Stewart Livingstone Wallace.
00:59Stewart, good morning.
01:00Happy Monday, I guess.
01:02Over the weekend, so much has happened, so many mixed signals.
01:05I guess the question is pretty straightforward.
01:08Where do we stand or where do you think we stand at this point?
01:11I mean, we're exactly where we were several months ago in the sense that Iran puts forward a deal that
01:17looks very much like the MOU that was signed back in the summer.
01:22That largely gets rejected.
01:24And again, we're in the situation now where both sides think the other one will blink first.
01:29And the reality is that there is no signs that either side is going to blink first.
01:33Both can sustain, I think, the level of pain that they're getting in terms of either attacks on shipping or
01:38the attacks on their economies or whatever else.
01:41Plus, of course, the additional calculation for the U.S. president who's got the midterms coming up.
01:45Be interesting to see if he does anything before then.
01:49But again, the favorite phrase, you know, who has all the cards, seems to be doing the circuit yet again.
01:54And I think that speaks to kind of the current situation, the unwillingness to bend by either side.
01:59Now, Stewart, President Trump did threaten that the bombing could return after the midterm elections.
02:03He did reject the seven-day proposal that Iran had laid out.
02:08And he also said something else that is key to what we're seeing in the energy space right now,
02:12which is record high numbers for oil flowing through the Strait of Hormuz over on Saturday.
02:18How true is that to our knowledge?
02:21Very hard to double-check those facts.
02:23Now, we do know that ships are getting through.
02:25We do know that oil is moving.
02:27I mean, you wouldn't necessarily think it with $107 a barrel on Brent.
02:30And again, that backwardation, pretty severe.
02:33So there is clearly high anxiety in the market about near-term supply.
02:37So however many barrels they are getting through, it's not enough to persuade the oil market that things are back
02:41to normal.
02:42That is a very, very distressed oil price.
02:44And we still expect some kind of diplomacy to prevail this week.
02:48Of course, that remains to be seen.
02:50It's early in the week.
02:51Stewart Livingstone, Wallace, Bloomberg's executive editor for the Middle East and North Africa with the latest updates.
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