Note: The Global Morning Briefing summarizes international news reported by Seoul Economic Daily.
Saudi Pipeline Halted, Hormuz Traffic Shrinks — Will Oil Climb Further?
The U.S. military has cut escorts for commercial ships passing through the Strait of Hormuz to twice a day. A Saudi Arabian pipeline that has served as a key detour for crude since the U.S.-Iran war was also hit by a drone attack and has been shut down entirely. With international oil prices already above $100 a barrel amid the escalating conflict, the routes carrying Middle Eastern oil have narrowed both at sea and overland.
According to the Financial Times, the U.S. Naval Cooperation and Guidance for Shipping (NCAGS) sent an email to maritime advisers early this month instructing them to reduce commercial ship escort windows to twice a day. Since May, the U.S. military has provided air cover for vessels sailing along the Omani coast south of the Strait of Hormuz. Analysts said the change appears aimed at ensuring safe passage after Iran launched a series of nighttime attacks on ships transiting the strait.
Earlier, Yemen's pro-Iran Houthi rebels seized a strategic point, putting the Bab el-Mandeb Strait at risk. Both of the main sea routes carrying Middle Eastern crude are now in danger.
Clashes between the Houthis and Yemeni government forces are intensifying further. Yemeni government troops backed by Saudi Arabia killed Houthi members near the Red Sea port of Mocha on the 12th and carried out three airstrikes on Houthi strongholds and barracks.
As Middle Eastern oil supply continues to shrink, analysts said prices already above $100 a barrel could be pushed higher still. The International Energy Agency (IEA) estimated last month that global oil output fell by 1.6 million barrels a day from a year earlier and that the decline would reach 5.7 million barrels a day for the full year.
BRICS Leaders Call for Restraint in Middle East Conflict
Leaders of BRICS, the bloc of non-Western emerging economies led by China and Russia, spoke with one voice in calling for maximum restraint in conflicts in the Middle East.
BRICS leaders unanimously adopted the New Delhi Declaration, a joint statement, on the first day of the 18th summit held in New Delhi, India, on the 12th.
In the declaration, the leaders said they expressed "deep concern over the continued escalation of tensions in the Middle East" and urged "maximum restraint and avoidance of actions that could further worsen the situation." The declaration did not assign responsibility to any specific country, including the United States or Iran.
Trump Says China Building Car Plants in U.S. Is 'Fine' Ahead of Washington Summit
U.S. President Donald Trump has signaled he could accept Chinese automobile production in the United States, about 10 days before Chinese President Xi Jinping's visit. As expectations grow that artificial intelligence will emerge as a main agenda item at the U.S.-China summit in Washington, foreign media also reported that China had told the United States it could put the summit on hold over arms sales to Taiwan.
According to Reuters, Trump said in an interview with Fox News on the 11th that he was fine with China coming into the United States to build car factories. Trump said the most important thing was for Americans to get jobs, noting that Japan also employs U.S. workers by producing cars in the country. He drew a line, however, at Chinese automakers building plants in Mexico and then exporting finished vehicles to the United States, saying that would be unacceptable.
Trump appears to have made the remarks with the summit with Xi in mind. But U.S. automakers immediately pushed back strongly.
Separately, Kyodo News reported that China had told the United States it could suspend the summit if Washington approves new arms sales to Taiwan.
Where Would $1.2 Trillion Come From? Funding for Trump's $5,000 Dividend Remains Unclear
Confusion persists among aides over how to fund the $5,000-per-person "dividend" that U.S. President Donald Trump pledged ahead of the midterm elections.
According to NBC News, Commerce Secretary Howard Lutnick said in an interview that the funding Trump wants to distribute could be secured without relying on the fiscal deficit or taxpayer money, pointing to the "Trump Platinum Card" as a way to do so. Lutnick said more than 100,000 people are on a waiting list to come to the United States and argued that $500 billion could be raised through the program.
Vice President J.D. Vance has presented tariff revenue as the core funding base. In an interview with Fox, Vance defended Trump's pledge as a "dividend for American workers" and said revenue secured through steep tariffs could be returned to the public.
Paying $5,000 each to roughly 240 million American adults would require $1.2 trillion by simple arithmetic. Even if the platinum card revenue Lutnick cited materializes, it would cover less than half the total cost.
The plan to cover the cost with tariff revenue is equally unrealistic. According to the Congressional Budget Office (CBO), tariff revenue from October last year through August this year came to $167.3 billion, up just 1.2% from the same period a year earlier. The CBO estimates the maximum annual tariff revenue over the next decade would be only $424 billion.
Amid Warnings of Human Extinction, AI Chiefs Say Slow Down
As concerns spread that artificial intelligence could pose a catastrophic threat to humanity, the heads of major AI companies including Anthropic, OpenAI and xAI have all called for slowing the pace of development.
Anthropic Chief Executive Dario Amodei wrote on his blog on the 12th that it is necessary to deliberately slow the pace at which AI model capabilities improve, arguing that development would still move quickly but that the time gained should be used wisely to secure safety. He added that over the past several months he had become convinced that a far more cautious approach is needed to fundamentally address the risks, stressing that the pace of development itself must be adjusted so that safeguards can keep up with gains in model capability.
OpenAI CEO Sam Altman said on X, formerly Twitter, that he agreed with Amodei and that OpenAI would also follow a policy of deploying external safety evaluators. Elon Musk, CEO of xAI, briefly voiced agreement, saying Amodei was right, while Google DeepMind CEO Demis Hassabis said Amodei's direction was correct, adding that the details would need to be worked out but that this was a critical moment when such a direction was right.
