Here's the latest
• Price of war: The Iran war has cost the US $29 billion so far— an estimate that’s higher than the $25 billion figure the Pentagon provided to Congress two weeks ago. An expert from Harvard Kennedy School said in April the conflict could cost US taxpayers $1 trillion.
• Trump-Xi summit: President Donald Trump is heading to China, where he said he’ll have a “long talk” on Iran with Chinese leader Xi Jinping, but downplayed the need for Beijing’s help. China has long been a close ally of Iran and is the main importer of Iranian oil.
• Economic shock waves: Trump said “I don’t think about Americans’ financial situation” when negotiating with Iran. “I think about one thing: We cannot let Iran have a nuclear weapon, that’s all,” he told reporters.
US and China trade envoys hold “constructive” talks ahead of Trump-Xi summit, Chinese state media says
Top trade delegations from the US and China held talks in South Korea on Wednesday, Chinese state media reported, ahead of a much-anticipated summit between US President Donald Trump and Chinese leader Xi Jinping.
“The two sides conducted candid, in-depth, and constructive exchanges on resolving economic and trade issues of mutual concern and further expanding practical cooperation,” Chinese state broadcaster CCTV reported, without elaborating on the specific issues discussed.
The delegations were headed by US Treasury Secretary Scott Bessent and Chinese vice premier He Lifeng.
Oil prices dip, stocks inch higher as Trump heads to China
Oil prices are falling and stocks are rising, as investors wait to see how talks between US President Donald Trump and Chinese leader Xi Jinping could affect the current fragile ceasefire between the United States and Iran.
Brent crude, the global oil benchmark, was 0.7% lower at $107 a barrel. WTI, the US benchmark, fell 0.9% to $101.2 a barrel.
The modest declines halted a three-day rally, as oil prices reflected “increased nervousness that a US-Iran deal looks further away,” Deutsche Bank analysts wrote in a note.
Meanwhile, equity markets gained following sell-offs yesterday, partly driven by worse-than-expected US inflation data. S&P 500 and Nasdaq futures pointed to a stronger open, with Dow futures flat. In Europe, major indexes were positive in morning trade. South Korea’s Kospi once again led broad-based gains in Asia, while an index tracking Taiwan’s 50 most valuable companies fell.
“Global equity markets are trying to edge higher this morning, but the mood is far from euphoric, with the ongoing stalemate in the Middle East continuing to drag on risk appetite,” Matt Britzman, a senior equity analyst at Hargreaves Lansdown, an online investment platform, wrote in a note.
“Investors are also watching President Trump’s meetings with China closely, with any signs of progress on trade likely to set the tone for the next leg in market sentiment,” he added.
Chinese supertanker seen traveling through Strait of Hormuz as Trump heads to Beijing
A Chinese-flagged oil supertanker appeared to be attempting to traverse the choked Strait of Hormuz Wednesday as US President Donald Trump was on his way to Beijing for a high-stakes meeting with Chinese leader Xi Jinping.
The vessel Yuan Hua Hu was seen moving east through the strait Wednesday morning, MarineTraffic data showed.
It last appeared on ship tracking around 8.45 a.m. local time. It’s unclear if it turned off its automatic identification system (AIS) tracker afterwards.
Traffic in the strait, a major oil shipping pathway, has slowed to a trickle since the Iran war began. Ships that attempt the crossing risk being attacked or detained. The US has also imposed a naval blockade against Iran’s ports.
MarineTraffic data shows the ship stopped at Iran’s Asaluyeh port on February 28, the day the war began, and has traveled within the Persian Gulf since then. The latest port it called at was in the United Arab Emirates on March 20, according to the data.
Trump is expected to encourage Xi to push Iran to reopen the strait and agree to a suitable peace deal.
China is the main importer of Iranian oil, relying on a network of shadow fleet vessels to ferry crude between Iranian ports and so-called “teapot refineries.”
Pain at the gas pump and the price of the Iran war. Catch up on the latest headlines
As the US defense bill for the war with Iran is now estimated to be about $29 billion, the conflict’s disruption to major energy infrastructure is threatening to keep gas prices high for Americans.
Here’s the latest on oil and other key headlines from Tuesday:
- US Energy Department officials raised their forecast for gas prices and warned oil futures will likely stay above $100 a barrel in the coming weeks. Retail gas prices are now expected to average $3.88 a gallon this year and $3.62 next, according to the new EIA projections.
- One of the world’s largest onshore gas processing facilities located in the United Arab Emirates will not return to full operational capacity until 2027, according to its operator, after Iranian strikes hampered production.
- A large oil spill is continuing to swirl in the waters off Iran’s Kharg Island. Satellite imagery shows the spill, which was identified last week, flowing southward and fragmenting as it moves.
- The US war against Iran has cost $29 billion so far, according to Jay Hurst, who is performing the duties of Pentagon Comptroller. That is $4 billion higher than the figure senior Pentagon officials provided to Congress two weeks ago. However, one war budgeting expert told CNN that the conflict will ultimately cost US taxpayers at least $1 trillion.
- The United Kingdom is sending autonomous mine-hunting equipment and anti-drone systems to the Strait of Hormuz, the British Ministry of Defence said.
More to know from Israel and Lebanon:
- On Tuesday, at least six people were killed in Lebanon and two Israeli soldiers were injured in Israel as Iran-backed Hezbollah and the Israeli military continue trading fire despite a fragile ceasefire.
- The Lebanese health ministry said at least 380 people have been killed and 1,122 injured in Lebanon since the ceasefire took effect on April 17.
- Israeli police issued a warning saying many Israelis had received messages from unknown numbers encouraging them to cooperate with Iranian intelligence and threatening them with further attacks.
- Israel is also concerned that Trump may strike an agreement with Iran before addressing some of the key issues that drove the two countries to launch the war in the first place, multiple Israeli sources have told CNN.
CNN’s Mustafa Qadri, Billy Stockwell, Matt Egan, Haley Britzky, Charbel Mallo, Hira Humayun, Florence Davey-Attlee, Dana Karni, Tal Shalev, James Frater and Max Saltman contributed reporting to this post.
How much has the Iran war really cost Americans? Breaking down the numbers
The Pentagon says the cost of the Iran war is $29 billion, a figure that’s higher than the $25 billion price tag it issued to Congress two weeks ago. But according to one war budgeting expert, the conflict will ultimately cost US taxpayers at least $1 trillion.
On Tuesday, a senior Pentagon official said the new cost of the conflict included updated repair and replacement of equipment, along with operational costs.
CNN previously reported that the earlier $25 billion estimate was a lowball figure that did not include the cost of repairing damage to US bases in the Middle East.
Linda Bilmes, a public policy expert at the Harvard Kennedy School, projects that the conflict with Iran will cost American taxpayers at least $1 trillion.
In an online post in April, Bilmes broke it down into short-term and medium to long-term costs:
- Short-term costs include munitions (missiles, bombs, interceptors), maintenance of 2–3 carrier strike groups, maintenance of personnel and combat pay, and lost or destroyed assets such as fighter jets and drones.
- She points out that replacement costs are often higher than the historical value of inventory. For example, a Tomahawk missile may be valued at $2 million in inventory, but replacing one today costs up to $3.5 million.
- Medium to long-term costs of the war include repairing facilities over the next 4–5 years, restocking inventory with higher-tech weapons systems, and veterans’ care for 55,000 US troops in the region who may be exposed to hazards.
On top of it all, there’s the impact of rising energy prices on the global economy from the ongoing conflict. The US Department of Energy now says oil prices will likely stay above $100 a barrel in the coming weeks, and some analysts warn the national average for gas at the pump will eventually hit $5 a gallon.
Trump downplays need for China's help in war with Iran before his trip
President Donald Trump said Tuesday that he plans to have a “long talk” about the Iran war with Chinese leader Xi Jinping when they meet in Beijing, though he downplayed the idea he would need China’s help in ending the conflict.
Asked what his message to Xi is on Iran, Trump said, “I think he’s been relatively good, to be honest with you. You look at the blockade, no problem. They get a lot of their oil from that area. We’ve had no problem. And he’s been a friend of mine.”
Minutes later, Trump downplayed the significance of discussing Iran with China, claiming the US has the situation “very much under control.”
CNN's Erin Burnett weighs in on Trump's comments about the economy and the Iran war
President Donald Trump told reporters Tuesday that he doesn’t “think about Americans’ financial situation” as the war in Iran has driven up some everyday prices for Americans. CNN’s Erin Burnett weighs in on some of Trump’s claims on inflation and the economy’s impact on Americans.
What to know about Trump's trip to China as US-Iran negotiations are at standstill
Negotiations between Washington and Tehran remain at an impasse after President Donald Trump called Iran’s latest counterproposal to end the war “a piece of garbage” over the weekend.
Trump is en route to China, where the war will be a big topic of conversation during his high-stakes summit with leader Xi Jinping.
If you’re just joining us, here’s what to know ahead of his arrival.
China’s role:
- The US president left Tuesday afternoon and said he plans to have a “long talk” about it with Chinese leader Xi Jinping. However, he downplayed the idea that he would need China’s help in ending the conflict. China has long been a close ally of Iran and is the main importer of Iranian oil.
- Beijing is viewed as a potential mediator between Washington and Tehran, Iranian Ambassador to China Rahmani Fazli said, according to Iranian state news agency IRNA.
- Defense Secretary Pete Hegseth will be with Trump on his trip.
Negotiations:
- Trump is confident Iran will stop enriching uranium and abandon any effort to build a nuclear weapon, he said during an interview on WABC on Tuesday.
- The president said he has been directly engaged with Iranian officials during the talks, he told WABC.
- He told reporters at the White House the US has the situation with Iran “very much under control” and “we’re either going to make a deal or they’re going to be decimated.”
- Trump also said he doesn’t “think about Americans’ financial situation,” when it comes to negotiating a deal. The “most important thing, by far” is that Iran doesn’t have a nuclear weapon, he said.
CNN’s Alejandra Jaramillo, Kit Maher, Aida Karimi, Nadeen Ebrahim, Sophia Saifi, Haley Britzky and Hira Humayun contributed reporting to this post.
