TODAY

On July 10, almost exactly a year after the Pentagon announced it was becoming the largest shareholder in MP Materials, the International Energy Agency put a number on what that deal was designed to prevent: $6.5 trillion in global downstream production now sits exposed to China’s rare-earth export curbs — restrictions currently suspended under an October 2025 truce that lapses again around October 2026. In the year between those two dates, Washington did not simply subsidize its way out of dependency on Chinese processing. It bought in: $400 million for 15 percent of MP Materials, a decade-long price floor for neodymium-praseodymium set nearly double the market rate, and a ten-year promise to buy everything a new Texas magnet plant produces. The Pentagon is now, functionally, a mining shareholder. The interesting question is not whether that has worked — MP’s private financing round attracted $1 billion from J.P. Morgan and Goldman Sachs within weeks — but what it costs to win a state-capitalist contest by becoming a state capitalist.

The stakes are structural, not cyclical. China controls roughly 70 percent of the world’s rare-earth and critical-mineral refining capacity, a chokepoint built over three decades while Western producers treated minerals as ordinary commodities rather than strategic assets. Beijing’s October 2025 tariff-war truce with Washington postponed, rather than cancelled, an expanded licensing regime that already cut U.S. yttrium imports from 333 tonnes to 17 tonnes in eight months — a squeeze aerospace manufacturers say could force production pauses. Washington’s answer has three parts: Project Vault, a $12 billion public-private stockpile signed by executive order on February 2, 2026, covering all 60 minerals on the USGS critical list; a fast-growing portfolio of direct government equity stakes in miners and processors; and a parallel push to sign allied-supply agreements with eight partners, including Australia, Japan, the UK and the UAE. Europe, meanwhile, is running a different playbook: a €3 billion RESourceEU plan, a joint-purchasing platform, and a stockpiling pilot — procurement and coordination, not ownership.

The MP Materials deal is the template, and its mechanics matter more than its headline. The Department of Defense’s July 2025 investment made it MP’s largest shareholder, attached a $150 million loan for expanding the Mountain Pass mine, and guaranteed a $110-per-kilogram floor price for NdPr oxide — a level industry analysts put at nearly double the prevailing market price — alongside a ten-year offtake covering the full output of a planned magnet facility in Fort Worth. Private capital followed the government’s signal almost immediately, which is precisely the point: Washington concluded that a guarantee was worth more to investors than a grant. That logic has since scaled. The administration has taken a $670 million stake in magnet producer Vulcan Elements, a 10 percent, $35.6 million position in Trilogy Metals, converted a renegotiated Energy Department loan into equity in Lithium Americas, and expanded the official critical-minerals list to include copper and metallurgical coal. Total direct equity commitments now exceed $1 billion, on top of Project Vault’s $12 billion stockpile.

The backlash has been immediate and specific, and it is worth taking seriously rather than waving off as sour grapes. Rival producers argue the price floor lets MP “undercut commercial bids, using federal subsidies to shield its margins,” while former White House and Pentagon officials warn the arrangement could “distort global NdPr pricing, crowd out innovation, and deter private investment in alternative supply chains” — in effect, recreating the very state-directed monopoly the policy exists to counter. That is the strongest objection, and it does not fully land: a government willing to take equity risk, rather than hand out grants, at least has an incentive to see the investment succeed and can in principle profit from the upside, which is the argument the Treasury and National Energy Dominance Council make for why this is smarter policy than Cold War-style stockpiling alone. But the objection identifies a real cost even if it doesn’t defeat the policy: an above-market, government-guaranteed price for one company makes every unsubsidized competitor in the same commodity harder to finance, which narrows rather than widens the eventual supplier base — the opposite of the diversification the strategy claims to deliver.

There is a second problem the price-floor logic obscures: capital committed is not the same as metal produced. The Center for Strategic and International Studies frames this as the difference between “distance” — how much progress has been announced — and “displacement” — how far supply chains have actually moved from their starting point. Japan’s experience with Lynas Rare Earths is the sobering comparison: fifteen years and $250 million of patient, low-drama investment before Lynas achieved the first commercial dysprosium production outside China, in 2025. Washington’s approach substitutes speed and scale for that patience, which may be the correct trade given the urgency, but it means the MP deal’s real test has not yet arrived — it arrives when the Fort Worth facility is supposed to reach full commercial output, not when Wall Street decides to match the Pentagon’s bet.

None of this is happening in a China-versus-America vacuum, either. The Democratic Republic of Congo has extended its cobalt export suspension specifically to tighten leverage over Chinese refiners, and Indonesia has repeatedly resisted pressure to loosen nickel export quotas, forcing processing onshore on its own terms. Producer states, not only the two superpowers, are now treating minerals as instruments of strategic leverage rather than commodities to be sold at whatever price clears the market. That reframes the whole contest: this is not simply Washington racing to catch Beijing, but a broader shift in which every government that sits on a mineral deposit is deciding whether to sell it or wield it.

Which is where Europe’s exposure becomes concrete. RESourceEU gives Brussels coordination and buying power, but no board seats and no offtake priority — and Chatham House’s own assessment is blunt that the UK and EU “cannot match the scale of what the US is attempting” and risk being “left behind” without equity of their own. That matters because Washington’s price floors do not stay domestic: a guaranteed $110/kg for MP’s output resets the benchmark every other buyer, including European manufacturers, has to price against, while offtake agreements tied to U.S. defense production can put European buyers behind the queue when supply tightens. The diversification Europe wants — away from dependence on Beijing — is real, but the replacement supply chain now runs increasingly through companies Washington part-owns and whose output is pre-committed to American industry first. Substituting one chokepoint for another is not the same as building a market.

What Happens Next

Base case (our estimate: roughly 55 percent probability). Washington’s equity-and-price-floor model extends to more minerals — copper and metallurgical coal are already on the list — and more companies, Project Vault’s stockpile builds through 2026–27, and the October 2025 China truce holds past its lapse date. Europe continues a purchasing-only strategy, remaining a price-taker on a benchmark increasingly set in Washington rather than Shanghai. This depends on Congress and private markets continuing to treat government equity as a credible signal rather than a fiscal liability, and on China preferring managed leverage over an open rupture.

Downside case. China allows the truce to lapse on schedule around October 2026 and resumes full licensing enforcement — already quietly restarting, according to recent customs-audit reports — before Vault-funded and MP-style projects reach meaningful output. Aerospace and defense manufacturers, already forced to ration yttrium and dysprosium at a fraction of pre-2025 volumes, face renewed production pauses in the exact window (2026–2028) when domestic capacity is still years from scale, exposing the gap between announced investment and actual tonnage.

Upside case. Government stakes prove to be a bridge rather than a permanent structure: MP, Vulcan Elements and Lithium Americas hit production targets on schedule, price floors become unnecessary as Japan’s Lynas eventually showed is possible after fifteen years of patient investment, and the eight-nation allied-supply framework matures into a genuinely plural, competitively priced market that Europe can buy into on equal terms rather than through Washington’s balance sheet.

The Pentagon’s bet on MP Materials shows that the fastest way to out-compete a state-directed rival was to become one — and by the only metric available so far, capital raised, that gamble is working. But capital raised is not resilience, and every mineral now being withheld or weaponized elsewhere, from Congolese cobalt to Indonesian nickel, shows the world’s supply chains are being redrawn along political lines everywhere, not simply rerouted away from Beijing.

Watch whether China lets its rare-earth export truce lapse on schedule around October 2026, and whether MP Materials’ Fort Worth magnet plant is producing at commercial scale when it does. If the truce holds and the plant delivers, Washington’s ownership model will keep expanding. If either fails, the U.S. will have discovered it bought a shareholding in a company, not a supply chain immune to the country it was built to out-manoeuvre.

Lionel Messi returns to Inter Miami after Argentina’s World Cup final defeat by Spain, which led to retirement rumours.

Football superstar Lionel Messi ‌has returned to practice for Inter Miami, 10 ⁠days after Argentina’s World Cup run ended with a 1-0 extra-time loss to Spain in ⁠the final earlier this month.

The two-time defending MLS MVP missed Miami’s first two matches after ⁠the World Cup break against Chicago and Montreal, both of which the team still won, extending its winning streak to six matches.

The 39-year-old also chose not to participate ‌in Wednesday night’s MLS against Liga MX All-Star Game in Charlotte, instead taking some time off to visit his father, Jorge, who the Messi family announced during the World Cup is battling an undisclosed illness.

Messi concluded this year’s World Cup, ⁠his record sixth, with eight ⁠goals and four assists, coming one win away from leading Argentina to be the first team to win consecutive World Cups since ⁠Brazil in 1958 and 1962.

He was the first player to break Miroslav ⁠Klose’s record for career World ⁠Cup goals with his 17th in Argentina’s second match, but French sensation Kylian Mbappe finished the World Cup one goal ahead of ‌Messi, 22 to 21.

Inter Miami (11-2-4, 37 points) is two points behind Nashville SC atop the Eastern Conference ‌standings. ‌It is not yet known if Messi’s return will come in Saturday’s home match against the Columbus Crew.

There had been some speculation that Messi would not only conclude his international career following the World Cup, but that he may also call time on his playing days at club level.

The former Barcelona and Paris Saint-Germain forward has won eight Ballon d’Or titles, the annual award for the player voted the best in the world that year.

Saltburn’s amateur cricketer at centre of cheating allegations that grabbed global headlines is suspended by club.

An English ‌amateur cricketer at the centre of allegations ⁠of finger-clicking ⁠trickery has been suspended and will not play “for the foreseeable future”, his club has said.

The fielder, dubbed “Clicky Ponting” on social media in a punning nod to former Australia captain ⁠Ricky Ponting, allegedly tricked umpires by clicking his fingers to make the sound of a ball nicking the bat as deliveries were missed and caught by ‌the wicketkeeper.

The video footage went viral on social media and made international headlines.

Saltburn Cricket Club, run by volunteers, said on Wednesday in a statement it was treating the allegations “with the utmost seriousness”.

“The player at the centre of the complaint has been suspended ⁠and will not play again ⁠for the club this season or in the foreseeable future, pending the outcome of this investigation.”

It said initial discussions between club ⁠officials and the North Yorkshire and South Durham league had already taken ⁠place.

The league said on Tuesday ⁠it had received a formal complaint “regarding alleged incidents in a Division Two game on Saturday 25th July 2026”.

Saltburn said it had ‌been a distressing and stressful experience for all concerned and asked for “personal boundaries” to be respected.

The club ‌are ‌top of the Division Two table with 10 wins from 15 matches.

Historically, cricketers – even at the highest level of the game – have been accused of trying to trick umpires with noises, including chomping on a biscuit, to fool umpires into believing the ball hit the bat.

Cricket cheating allegations have even extended to dirt being applied to the ball, for which former England captain Michael Atherton was once fined, and the use of bottle tops to scuff the ball.

Both were attempts to create extra swing for the quick bowlers.

The US has bombed multiple cities across southern Iran, including Ahvaz and Abadan, in what Central Command described as a ‘heavy wave of strikes’. Earlier, US President Donald Trump said the US would hit Iran ‘very hard’ in retaliation for an attack on US forces in Jordan.

Seven people, including two children, have died during a Russian missile and drone attack on Ukraine, according to local officials.

President Volodymyr Zelensky warned on Wednesday that Russia had been preparing for a “massive attack”, urging people to heed air raid alerts.

In the early hours of Thursday, the Ukrainian military reported multiple missile and drone strikes around the country.

The attacks come after Zelensky met US President Donald Trump in Washington DC this week to urge the US to grant Ukraine a licence to produce Patriot interceptor missiles.

Two girls, aged 5 and 12, were among the six killed in a village near the central Ukrainian city of Kryvyi Rih when a ballistic missile hit a private house, a local official said.

Eight more people were injured, including two children, the official added, noting that the number of casualties could rise.

In Kyiv, one person died and fires broke out in three non-residential buildings overnight, the capital’s mayor Vitali Klitschko wrote on Telegram.

Explosions were also heard in Lviv, its mayor Andriy Sadovyi said, reporting that residential buildings had been damaged.

Southern Lebanon’s Mansouri village is divided by Israel’s Yellow Line, a military boundary separating 6% of Lebanese territory it occupies from the rest of the country. Al Jazeera’s Zeina Khodr spoke to residents who say they’re living with fear.

Evidence has emerged indicating that China’s YJ-20 hypersonic anti-ship missile is now also being fielded aboard the People’s Liberation Army Navy’s (PLAN) Type 052D class destroyers. These warships are far more numerous than the Type 055 ‘super destroyers,’ from which the missile was previously seen being fired, as we reported at the time. The new development suggests that the PLAN intends to distribute the weapon across a much broader portion of its surface fleet rather than reserving it exclusively for its largest combatants.

A new video apparently originating from the PLAN shows the launch of a YJ-20 from the cold-launch vertical launch system (VLS) on the foredeck of an unidentified Type 052D destroyer, known in the West as the Luyang III class. After being ejected from the launcher, the missile’s solid rocket motor ignites before it accelerates rapidly away. No target engagement is shown.

Typically, the Type 052D’s VLS would be loaded with variants of the HHQ-9 surface-to-air missile, YJ-18 subsonic anti-ship cruise missile, CJ-10 land-attack cruise missile, and CY-5 anti-submarine missile.

The 7,500-ton Type 052D has 64 VLS cells, 32 forward and 32 aft. It’s unclear whether each of these is able to accommodate the big YJ-20 missile.

This compares to the Type 055’s 112-cell VLS system, which makes it the PLAN’s premier surface strike platform. However, only 10 of these ships are currently in operational service, with additional vessels still under construction. By contrast, approximately 35 Type 052D destroyers have entered PLAN service, with production continuing.

Putting the YJ-20 on the Type 052Ds would significantly expand the number of Chinese warships capable of launching hypersonic anti-ship strikes, further strengthening Beijing’s growing anti-access/area-denial (A2/AD) posture across the western Pacific. On the other hand, it remains possible — although less likely — that the launch depicted is some kind of trial or experimental effort that might not lead to large-scale fielding on these hulls.

The new video follows the release of official Chinese military footage showing what the PLAN described as a “finalization test” of the YJ-20 launched from the Type 055 destroyer Wuxi, late last year. That video appeared to confirm the missile’s integration with China’s largest surface combatant, a warship design that you can read more about here.

That test from the Wuxi provided the first official acknowledgement of the ship-launched YJ-20. The missile itself had previously been unveiled publicly during China’s military parade commemorating the 80th anniversary of victory over Japan in World War II, although speculation surrounding the weapon stretches back several years before that.

A missile first observed during what appeared to be a Type 055 launch in 2022 was widely referred to as the YJ-21. Subsequent official Chinese designations now strongly suggest that weapon was actually the YJ-20, or an earlier developmental version of it.

The YJ-20 is understood to be a hypersonic anti-ship weapon employing either an aero-ballistic flight profile or potentially a boost-glide vehicle: different Chinese sources have described both concepts at various times. In either case, the missile is optimized for extremely high terminal speed combined with unpredictable maneuvering designed to defeat modern naval air defenses.

Unlike a traditional ballistic missile that follows a predictable parabolic arc, an aero-ballistic missile can execute quasi-ballistic maneuvers — including skip-glide or ‘porpoising’ trajectories — as it descends toward its target. These abrupt changes in altitude and direction make interception significantly more challenging.

Chinese state media have also described the missile as employing a conical boost-glide vehicle, which would use a rocket booster to accelerate to high altitude before gliding toward its target while conducting sustained maneuvering throughout the terminal phase.

Although many details remain murky, it is generally considered that the missile achieves speeds well above Mach 6 during cruise and may approach Mach 9 during its terminal attack. Estimated range is generally assessed at more than 620 miles.

Guidance is believed to combine satellite navigation and mid-course updates before transitioning to an active radar and/or infrared seeker during the final approach.

Weapons with these characteristics are particularly well suited to engaging high-value naval targets including aircraft carriers, amphibious assault ships, cruisers, and other major surface combatants. The missile likely also possesses a secondary land-attack capability against fixed targets.

With their combination of extreme speed and maneuverability, hypersonic weapons can dramatically compress an opponent’s decision-making timeline while reducing opportunities for interception, making them especially valuable against time-sensitive targets. They also require very high-end interceptors, if they can be intercepted at all.

The apparent expansion of the missile to the Type 052D is arguably an even more significant milestone than the Type 055 test itself.

For China, fielding the YJ-20 aboard both the Type 055 and the much more numerous Type 052D dramatically increases the number of PLAN hulls capable of conducting long-range hypersonic anti-ship attacks. Such a move represents another step in expanding the reach of its layered A2/AD strategy. Rather than concentrating hypersonic capability in a small number of flagship destroyers, the PLAN appears to be distributing it across a much larger force capable of operating throughout the First Island Chain and increasingly beyond it.

Clearly, a larger force of PLAN destroyers armed with hypersonic anti-ship missiles would complicate U.S. and allied naval operations across the western Pacific by increasing the number of launch platforms capable of threatening high-value warships from long stand-off ranges.

At the same time, it is unclear if the YJ-20 has formally entered full operational service. However, official test footage, public appearances during military parades, and, above all, launches from two separate destroyer classes all point toward the missile transitioning from a developmental program to a broader capability.

The development underscores two major issues for the U.S. military as it gears up to face the prospect of a potential conflict with China in the Indo-Pacific. On the one hand, the PLAN is growing at an alarming rate, and Chinese shipyards are churning out increasingly capable warship designs, not to mention submarines and other naval weapons.

The latest annual Pentagon report to Congress on China’s military, released at the end of 2025, stated that “China has the world’s leading hypersonic missile arsenal and continued to advance the development of conventional and nuclear-armed hypersonic missile technologies during the past year.”

With that in mind, the case study of the YJ-20 further underscores the fact that China is investing heavily in the development of hypersonic missiles and is now apparently scaling that capability across a larger proportion of its surface fleet, something that will have a significant effect on the regional naval balance.

Contact the author: thomas@thewarzone.com

Decision follows long-running feud between Trump and UN group.

The United States has announced the release of $600m for Gavi, as it cut off the World Health Organization (WHO) from the global vaccine alliance, in a major financial blow to the United Nations group.

In a joint statement, the US Department of State and the Department of Health and Human Services said: “The United States also reaffirms that it will not provide US Government funding to the World Health Organization through Gavi.”

The development, said the statement, is in line with US President Donald Trump’s instructions to “Health and Human Services Secretary Robert Kennedy Jr and Secretary of State Marco Rubio, to negotiate reforms with Gavi as a condition for renewed US support”.

US Republican Senator Susan Collins, who had pushed for the reinstatement of US funding for the global programme which expands access to immunisations around the world, welcomed the decision.

According to the State Department, Gavi agreed to work towards replacing mercury-containing vaccines with mercury-free alternatives, in partnership with its board and partner countries.

The Trump administration’s latest move against the WHO comes after historical animosity.

In 2020, Trump instructed his administration to temporarily halt funding to the WHO over its handling of the coronavirus pandemic, claiming the WHO promoted China’s “disinformation” about the virus, likely leading to a wider outbreak.

At the time, the US was the biggest donor to the WHO, contributing more than $400m in 2019, roughly 15 percent of its budget.

In January 2021, then-US President Joe Biden reversed Trump’s decisions, restoring US funding and halting the withdrawal process from the WHO.

However, on the first day of his second term, January 20, 2025, Trump said the US would withdraw from the WHO and suspended US contributions.

Experts have said the orders appear to be about ideological rather than strategic positioning.

The WHO is funded by a combination of core operating funds that each member state pays, and voluntary contributions from various partners.

At about $3.4bn, the WHO’s budget is roughly a third of that of the Centers for Disease Control and Prevention (CDC), which got $9.3bn in core funding in 2023.

The WHO funds support programmes to prevent and treat polio, tuberculosis, HIV, malaria, measles and other diseases, especially in countries that struggle to provide healthcare domestically.

It also responds to health emergencies in conflict zones, including parts of Gaza, Sudan, the Democratic Republic of the Congo, and others.

“I know I’m not going to be a millionaire running a bakery,” says Phil Clayton.

We are speaking in the busy bakery he runs with his wife Tina. It is only 10am, but the operation has been in full swing for nine hours.

Clayton says it is “absolutely not true” that the bakery enjoys more profit due to price rises.

In May, families were paying 2% more for bread rolls than they were a year earlier, according to the CPI.

But in April, farmers were receiving 0.3% less for wheat, the main ingredient, according to API figures.

The 2% increase in prices for customers is smaller than the 3% rise seen across the whole CPI index.

Clayton says he does not regret increasing his prices by 10p to 20p.

“My responsibility is to make sure all of this lot get paid,” he says, referring to his 30-strong team, which includes bakers, delivery drivers and Saturday staff employed in the cafe that adjoins the bakery.

Clayton points out the extra money shoppers pay at the tills goes towards increases in rent, wages, National Insurance, delivery fuel and the rising cost of flour – much of which originates from farms in the region.

OpenAI CEO Sam Altman has met with US senators to discuss his company’s upcoming models, as President Donald Trump said he is considering AI “controls” following OpenAI’s disclosure that one of its AI systems escaped containment during a security test.

“We’re looking at controls,” Trump told reporters in the Oval Office in response to a question about OpenAI’s rogue agent, adding that he did not want to “restrict” AI developers from building new products.

A rogue agent escaped the handling of ChatGPT maker OpenAI and hacked the AI firm Hugging Face last week. Then, on Tuesday, it was revealed that a second company had been a target, too – Modal Labs, a New York City-based AI infrastructure firm.

The company itself was not hacked but an account of a customer hosted on Modal’s infrastructure. Modal’s chief technology officer, Akshat Bubna, did not confirm which customer was the target. The hack escaped a contained environment during a security test.

“We’re aware a Modal customer published an unauthenticated endpoint that allowed anyone on the internet to use their sandboxes for code execution,” Bubna said in a statement. “This was used by the rogue agent. Modal’s platform or isolation were not compromised in any way.”

Altman has long been accused of dismissing concerns that his products and the AI industry impact society at large, including in a recent lawsuit brought by the State of Florida that alleged the company put profits ahead of user safety.

Now, he appears to be walking back some of his past enthusiasm around AI’s pace of growth.

In a podcast called Invest Like the Best, Altman called the Hugging Face hack an “extremely sci-fi cyber incident” and later said that it was the “first security incident that I have felt very viscerally”.

“We may have to pace the rate of AI development to give ourselves enough time for society to harden around some of these new capability levels,” he said on the podcast.

On Saturday, Altman said that AI has reached “the singularity”, when AI surpasses human intelligence and becomes harder to control. He had previously said this would not be reached by 2030.

Washington meetings

Altman was in Washington, DC, this week, meeting with US Senators Raphael Warnock, a Democrat from Georgia, and Bernie Moreno, a Republican from Ohio on Wednesday. Altman told reporters that the hacking was discussed but was not the focus of the meeting.

Altman is also set to meet with Democratic Senator Mark Warner of Virginia, the top Democrat on the chamber’s Intelligence Committee.

CNBC reported that Altman is also to make a trip to the White House to meet with Trump’s chief of staff, Susie Wiles. Last month, the president signed an executive order requesting that AI companies assess their models before full release.

Financing concerns

The hacking and meetings come alongside pressure from Wall Street amid renewed concerns about potential circular financing, following reports that semiconductor chip giant Nvidia is undergoing talks with OpenAI to provide funding guarantees for a data centre in Ohio.

The $250bn deal would help the ChatGPT owner lease a 10-gigawatt project that SB Energy, a subsidiary of SoftBank, is building in Piketon, Ohio, 109km (68 miles) south of Columbus, Ohio. It is part of a public-private partnership that allowed SoftBank to build the world’s largest AI data centre on government land owned by the US Department of Energy.

“The demand is not as big as it appears to be because, again, the companies are buying from each other using their own money to some degree, as opposed to, say, OpenAI having such tremendous demand from customers, monetising it properly, and then using customers’ money to buy Nvidia chips. They’re essentially using Nvidia’s money to buy Nvidia chips,” said Aleksandar Tomic, associate dean at Boston College.

The development comes as the Altman-led company is leaning towards an initial public offering, which, according to reporting from The New York Times last month, could be in 2027.

This week FIFA announced plans to form a new subsidiary company to run part of the World Cup and offer a 20% stake to private investors, worth over $4B. Jared Kushner’s brother’s investment firm Thrive Eternal has been named a likely buyer. Al Jazeera’s Mohammad Saleh explains.

US and Saudi forces launched coordinated airstrikes targeting Iran-backed Popular Mobilisation Forces (PMF) bases across Iraq, reportedly killing 20 fighters. Videos show the aftermath of the strikes,which were launched in response to alleged drone attacks on Saudi oil facilities.

Asian stock markets extended their sharp selloff on Wednesday as investor concerns over artificial intelligence (AI) valuations deepened ahead of a crucial round of earnings from major U.S. technology companies and the Federal Reserve’s latest monetary policy decision. The decline reflects growing skepticism over whether massive investments in AI infrastructure will generate sustainable profits, while renewed tensions in the Middle East added fresh inflationary risks through higher oil prices.

The market downturn comes after months of extraordinary gains driven by optimism surrounding AI, particularly among semiconductor manufacturers and technology giants. However, disappointing earnings signals and concerns over corporate cash flows are prompting investors to reassess whether the sector’s lofty valuations remain justified.

Asian Markets Extend AI Driven Selloff

Technology heavy markets across Asia led the global decline as semiconductor stocks came under intense pressure.

South Korea’s KOSPI plunged more than 11 percent, reaching its lowest level since April after suffering another double digit loss a day earlier. Taiwan’s benchmark index dropped 5 percent, while Japan’s Nikkei declined 2.6 percent. The broader MSCI Asia Pacific index excluding Japan also fell sharply, highlighting widespread investor caution across the region.

The weakness was concentrated in technology stocks that have largely fueled this year’s market rally through expectations of sustained AI demand.

Chip Stocks Face Growing Scrutiny

Semiconductor companies remained at the center of the selloff despite reporting robust financial results.

South Korean memory chip giant SK Hynix reported operating profits that increased more than sixfold compared with the previous year. Nevertheless, its shares fell 9 percent after investors judged the results against exceptionally high expectations.

Market participants are increasingly demanding stronger evidence that companies can convert enormous AI related capital expenditure into long term profitability. Investors are also seeking clearer commitments regarding shareholder returns and long term supply agreements before assigning premium valuations.

The reaction illustrates how market expectations have evolved from rewarding growth alone to demanding measurable financial returns.

Big Tech Earnings Become Critical Test

Attention has now shifted to earnings from Microsoft and Meta, which are expected to provide important insight into the financial sustainability of AI investments.

The results follow disappointing updates from Alphabet and Tesla, whose weaker cash flow performance raised concerns that rising AI spending may be placing increasing pressure on corporate finances.

Investors will closely examine whether major technology companies can demonstrate that billions of dollars invested in AI infrastructure are producing corresponding improvements in revenue growth and profitability.

Failure to provide convincing evidence could accelerate the ongoing market correction.

Oil Prices Rise as Middle East Tensions Return

Geopolitical developments added another layer of uncertainty after renewed military activity between the United States and Iran pushed energy prices higher.

Brent crude rose more than 3 percent while West Texas Intermediate crude also gained over 3 percent following reports of Iranian ballistic missile launches and renewed concerns over the security of shipping through the Strait of Hormuz.

The waterway remains one of the world’s most strategically important energy corridors, and any disruption raises fears of tighter global oil supplies and renewed inflationary pressures.

Higher energy prices have complicated the outlook for financial markets by increasing uncertainty over future monetary policy.

Federal Reserve Decision in Focus

The Federal Reserve’s policy announcement has become increasingly significant as investors attempt to balance slowing market sentiment against persistent inflation risks.

Markets remain divided over whether the central bank will maintain current interest rates or opt for another increase. Rising oil prices have strengthened expectations among some analysts that policymakers may adopt a more cautious stance toward inflation.

A more hawkish outcome could place additional pressure on technology stocks, whose high valuations remain particularly sensitive to higher borrowing costs.

Analysis

The latest market correction suggests that the AI investment narrative is entering a more demanding phase. Investors are no longer rewarding technology companies solely for expanding AI infrastructure but increasingly expect tangible financial returns from unprecedented levels of capital expenditure.

At the same time, renewed geopolitical tensions in the Middle East have introduced fresh inflation risks through higher oil prices, complicating the Federal Reserve’s policy choices and adding further uncertainty to global financial markets. Higher interest rates typically reduce the attractiveness of high growth technology stocks by increasing financing costs and lowering future earnings valuations.

While the long term outlook for artificial intelligence remains strong, the market appears to be transitioning from optimism driven by expectations to a phase focused on profitability, efficiency, and sustainable returns. Companies that fail to demonstrate clear commercial benefits from their AI investments may continue to face heightened investor scrutiny, making upcoming earnings reports a defining test for the next phase of the global AI driven market cycle.

With information from Reuters.

Caracas, July 29, 2026 (venezuelanalysis.com) – The Venezuelan government headed by Acting President Delcy Rodríguez has delivered a note of protest to Iranian authorities over “derogatory and inappropriate comments.”

The Foreign Ministry summoned the Iranian Ambassador Ali Chegini on Tuesday to formally communicate Caracas’ position.

“The Venezuelan government demanded an end to references that undermine the country’s dignity, sovereignty, institutionality, or reputation,” a press release from the Foreign Ministry read.

The Venezuelan government went on to emphasize its commitment to international relations based on “mutual respect and non-interference in countries’ internal affairs.”

The controversy stemmed from a recent interview where Iranian Foreign Minister Abbas Araghchi defended Tehran’s resistance against US-Israeli aggression and affirmed that “Iran is not Venezuela.”

“Iran is not Venezuela where you take one person and everyone else gets scared and backs down,” Araghchi said in an interview with Mehr News, referencing the January 3 operation that saw US aircraft bomb Caracas and nearby states while special forces kidnapped President Nicolás Maduro and First Lady Cilia Flores.

The attack killed over 100 people, including 32 Cuban soldiers who were part of Maduro’s security detail. Venezuelan officials, including Acting President Rodríguez and then Defense Minister Vladimir Padrino López, justified the decision not to respond to the military aggression, instead prioritizing “diplomacy” with Washington.

Following the Venezuelan government’s protest, the Iranian embassy in Caracas sought to ease tensions, recalling the “deep and historic” ties between the two nations and suggesting that Araghchi’s words had been taken out of context and “twisted.”

“The Iranian Foreign Minister’s words in no way convey a negative judgement about the proud Venezuelan people, their authorities, or their national sovereignty,” the statement read. The Iranian Foreign Ministry in Tehran, for its part, has yet to comment on the matter.

The recent diplomatic spat is indicative of the growing rift between the two formerly strategic allies since January 3. In the 2000s, former Venezuelan President Hugo Chávez pushed for stronger ties with Iran, then under President Mahmoud Ahmadinejad, grounded on the countries’ shared opposition to US aggression and violations of international law.

The two nations forged bilateral agreements on energy, defense, technology, and other fields. With Venezuela suffering from acute fuel shortages under US sanctions in 2020, Iran defied US threats to send multiple gasoline cargoes to the South American country.

However, following the January 3 strikes, the acting Rodríguez government fast-tracked a diplomatic reengagement with Washington. The Trump administration has exercised significant influence on Venezuelan affairs, with Venezuelan export revenues presently managed from a US Treasury Department account.

The rapprochement with the US has coincided with a broader shift in Venezuela’s geopolitical alignment. In February, the Venezuelan Foreign Ministry issued a statement condemning Iran’s response to the February 28 US and Israeli aggression. The communiqué was deleted a few hours later following strong criticism.

During the US-Israeli war against Iran, the acting Venezuelan administration manifested its “solidarity” with Washington allies Qatar and the United Arab Emirates. 

In the wake of the June 24 double earthquake, Rodríguez welcomed a military and diplomatic mission from Israel. The acting leader praised the Israeli team, which included multiple IDF officers, as “highly trained and professional” and thanked them for their on-the-ground work. Tel Aviv is reportedly set to continue assisting Caracas in “reconstruction” planning. Chávez severed ties with Israel in 2009, excoriating its occupation and genocide in Palestine and Lebanon, a stance maintained by Maduro.

Caracas’ objection to the Iranian official’s comments contrasted with its lack of response to recurring statements about Venezuela from Trump and other administration officials.

On Saturday, the US State Department applauded Venezuela’s decision to withdraw from the International Criminal Court while implying that the Caribbean nation does not have a “competent and independent judicial system.” It also boasted that Maduro is “facing justice in a US court.”

Maduro and Flores have pleaded not guilty to charges including drug trafficking conspiracy. Their trial is set to begin in June 2027.

Edited by Lucas Koerner in Cali, Colombia.

Taiz, Yemen – Fuad Mohammed has been working as a construction labourer for more than 25 years. The 46-year-old has seen things get progressively worse in Yemen’s construction industry since the war in the country started more than a decade ago, and then further deteriorate after the US-Israel war on Iran began in late February, with its devastating economic impact on the wider region.

“We can barely eke out a living for our families,” Fuad told Al Jazeera.

The ongoing regional war has damaged economies across the Middle East, with government-controlled areas of Yemen bearing a heavy burden as commodity prices soar. Among the hardest-hit sectors is fuel: in January, 20 litres (5.3 gallons) of diesel cost 25,000 Yemeni riyals ($17), but today that price has skyrocketed to 45,000 riyals ($30). That massive spike has triggered a domino effect, driving up the costs of all goods and services dependent on fuel and transportation – including construction.

As a result, countless construction projects across those areas – in Yemen’s east and southwest – have ground to a halt.

Pausing construction

Fuad explained that, before the US-Israel-Iran war, he was able to find work for around two weeks every month. But this year, he has now gone several months with barely any work.

“The price hikes in building materials have frustrated both homeowners and construction labourers,” Fuad said. “Those who want to build find that their budgets are no longer enough, and we are left with no work.”

Fuad recalled that he briefly found work in May for a woman who had saved money to build a home for her family. However, when a fresh wave of price increases hit the market, she paused construction to wait for prices to drop.

“I also work with construction contractors, but most of them have paused their projects at the request of homeowners,” he added. “When I call them, they tell me they are waiting for regional conditions to improve.”

As an example of the rising costs, the price of a truckload of sand increased from 130,000 Yemeni riyals ($87) to 190,000 riyals ($127), while the average cost of one metre of window glass rose from 90,000 riyals ($60) to 130,000 riyals ($87).

Fuad’s situation at home is desperate. Relying entirely on daily wages but having no work, he can not provide basic essentials for his family. He has considered finding another job, but he lacks professional experience in other fields.

In a desperate attempt to find work, he has lowered his daily wage from 25,000 Yemeni riyals ($17) to 20,000 riyals ($13).

“My situation is getting worse every day,” he said.

Economic division

An official from the Yemen Petroleum Company in Aden told the Reuters news agency in May that the increase in the price of diesel was caused by the worsening supply crisis and rising global fuel prices, driven by regional tensions and the closure of the Strait of Hormuz, alongside increased transportation and marine insurance costs. The official noted that the measure was temporary and would remain in place until the end of the crisis and conditions returned to normal.

Wafeeq Saleh, executive director of the Taiz Center for Yemeni-Gulf Studies, explained that the Yemeni economy was particularly susceptible to external economic shocks.

“Any disruptions in global commodity markets directly affect the local market because [Yemen] imports nearly 90 percent of its needs,” Saleh told Al Jazeera. “Consequently, the local rise in commodity and fuel prices is a natural outcome of surging global prices, shipping tensions in the Strait of Hormuz, as well as increased maritime insurance and freight fees.”

In areas controlled by Yemen’s Houthi rebels, however, including the capital Sanaa, there has not yet been a sharp increase in fuel prices, and therefore no impact on the construction industry – yet.

Yemen’s war has entrenched two separate economic structures in the country, with the central bank bifurcated between Aden and Sanaa, and two different exchange rates operating for the Yemeni riyal.

The Houthi group is already facing popular anger over a weak economy, as it grows increasingly isolated regionally and internationally. The group has so far avoided an increase in the price of fuel, with 20 litres (5.3 gallons) of diesel costing 9,500 Yemeni riyals, which at the exchange rate set in Sanaa is the equivalent of roughly $18.

“[The Houthis] may have sufficient inventory from previous months, which is why the local market hasn’t been affected,” Saleh said. “However, the impact will appear in the coming period when imports are made at the new price.”

The actions of the pro-Iranian Houthis themselves have contributed to the increase in global oil prices. Having sat out the Iran war for its first few months, the Houthis recently began attacks against Saudi ships passing through the Red Sea, after the Yemeni government and the Saudi-led coalition that backs it refused to allow a plane from Iran to land in Sanaa. The Houthi attacks mean that the transportation of oil from the Gulf is now disrupted in both the Strait of Hormuz and the Red Sea, and has contributed to oil prices going past $100 a barrel for the first time since May.

Will prices come down?

Lutf Zuraiqi, 58, had saved some money to build a home, but the dramatic increase in the cost of building materials forced him to pause the project until “things get better”.

“Price increases aren’t new in Yemen, but I believe this current surge is regional. I believe as soon as the regional war ends, building materials will return to their old prices,” Zuraiqi told Al Jazeera.

Zuraiqi has been following news of the Iran war on a daily basis because its end would mean lower material costs for him and the chance to resume building his planned home.

“The government promised that prices will go back down after the [US-Iran] war ends,” he said. “So this time I’m choosing to believe them and hope I will manage to finish my home.”

Mohammed Jameel, on the other hand, hasn’t been following the news – but the building contractor has been tracking prices of building materials instead. The 59-year-old believes that, based on his experience, once the price of the materials goes up, they never come down.

“I have worked in construction for more than four decades now, and throughout this entire period, building material prices have consistently risen,” Jameel said. “We have never witnessed a price drop. So, I advise those who have paused their construction to resume, as today is always better than tomorrow.”

Jameel said that he has been forced to reduce his rates and cut profit margins on major contracts to keep some work.

“My experience tells me it is normal for owners of homes and projects to pause work until they adapt to the new prices,” he added. “But eventually, construction labourers’ wages will rise, and the total cost of building will increase.”

Jameel feels for the plight of construction labourers, but he views this as a temporary phase and believes the suffering will ease once work picks up again. “We are all in the same boat, not just the daily wage labourers,” he said. “But we hope things will get better.”

Singapore has started exploring whether to become involved in the Global Combat Air Program (GCAP), a new report suggests. While it doesn’t state that Singapore has decided to join or purchase the Tempest fighter at the center of that program, it is in line with the country’s approach to buying the F-35. At the very least, it would seem to indicate that Singapore is starting to look at the sixth-generation combat aircraft technologies that could follow the Joint Strike Fighter.

According to Janes, Singapore has begun early, informal discussions about possible participation in GCAP. These are described as exploratory, meaning Singapore is gathering information rather than negotiating membership of the program.

The report explicitly states that the Singapore government has not made any decision to become a participant in the program, which makes sense considering that the Republic of Singapore Air Force (RSAF) is still waiting to receive its first F-35s.

GCAP is a joint next-generation air combat program led by the United Kingdom, Japan, and Italy, aiming to field the Tempest sixth-generation combat jet and wider air combat system by around 2035. With the demise of the pan-European Future Combat Air System (FCAS), GCAP is the preeminent Western sixth-generation fighter effort outside of the United States.

GCAP is intended to include not only the Tempest crewed fighter but also an integrated ecosystem of AI-enabled systems, advanced sensors, networking, air-launched weapons, and autonomous ‘loyal wingman’ aircraft.

As for the RSAF, this is a notably modern and capable force, benefitting from considerable investment throughout the years.

It is currently spearheaded by a combat fleet of 40 F-15SGs, plus 49 F-16C/Ds, a combination of Block 52 and Block 52+ jets.

Next, the RSAF will receive eight conventional takeoff and landing (CTOL) F-35As and 12 short takeoff and vertical landing (STOVL) F-35B fighters. The F-35Bs will be the first to arrive, with deliveries due to start before the end of this year. These will initially be based at Ebbing Air National Guard Base in Arkansas for training, with the first F-35Bs scheduled to be stationed in Singapore from 2029.

In total, Singapore covers an area of less than 280 square miles, putting unique strains on the RSAF.

In preparation for the F-35B, the RSAF is extending the runway at Pulau Sudong, an offshore location, which will reduce the noise burden on more populated areas. The existing runway will be extended from around 6,500 feet to approximately 9,800 feet, with work to be completed by 2028. The growing demand for training capacity is something that has previously led the RSAF to look at having a detachment in Guam, but the reworked Pulau Sudong should help address the issue.

The RSAF has traditionally acquired the best available Western-made equipment to meet its combat aircraft needs. Looking at what is currently the only sixth-generation combat jet that is likely to be available to Singapore for the foreseeable future makes sense. However, as Roy Choo, a defense journalist and TWZ contributor, noted, deeper involvement in GCAP would be years away.

“From this news, it appears they may have identified a future requirement for a sixth-generation fighter, although this is unlikely to transition into a program of record for at least another two decades,” Choo explained. “As with most operators, Singapore engages with industry to stay informed about available market offerings all the time.”

In the next decade or so, the RSAF will likely remain focused on its F-35A/B program and on bringing these aircraft up to full operational capability.

Another upcoming program will be a midlife upgrade for the F-15SG, deliveries of which first began in 2008. Choo expects work on this to begin once the ongoing F-16 upgrade is finished. The F-16s are set to remain in service into the mid-2030s, according to Singapore Chief of Air Force Maj. General Kelvin Fan. The F-15SG will be around longer, giving considerable lead time for it to be replaced by a sixth-generation platform.

When it comes to a path to a potential Singapore Tempest acquisition, it is worth looking at the approach taken with the F-35.

Singapore joined the F-35 program as a Security Cooperative Participant (SCP) in 2003 when it identified the fifth-generation fighter as a potential replacement for its F-16s. At that time, Choo notes, Singapore was still receiving its F-16s and was yet to select a contender for its Next Fighter Replacement Program (NFRP) — it eventually chose the F-15SG in 2005.

Singapore placed an initial order for four F-35B in 2020, a full 17 years after joining the program as an SCP. This is very much an indication of the long-term view Singapore takes in its defense procurement.

If Singapore were to join GCAP, it would likely be part of a long-term view toward acquiring a sixth-generation fighter capability.

While Singapore has maintained generally good relations with Beijing, it is acutely aware of its economic vulnerability in the face of rising tensions in the South China Sea as China makes increasingly forceful moves to assert its claims in the region. With China preparing for potential contingencies in the South China Sea through the continued expansion of its anti-access and area-denial (A2/AD) capabilities in the region, the People’s Liberation Army Air Force — busy working on its own sixth-generation platforms — is very much the pacing threat.

Given Singapore’s prudent approach to defense procurement, it is unlikely to commit large sums of money to a program at such an early stage of development.

If pursued, a likely option would be for Singapore to join GCAP with observer status, something that Canada (another F-35 customer) recently signed up to do. “This would give greater visibility of GCAP’s governance and capabilities,” Choo added. “After all, Singapore doesn’t have the deep technological know-how as the other full-tier partners.”

“An observer status would fit with its cautious and non-committal approach to the program just as it did with the F-35 SCP membership.”

Potentially, GCAP could provide a platform for Singapore to build future relationships with other partners and secure a workshare arrangement involving supply chain and maintenance work. That would all be a long way off, however.

Logically speaking, the RSAF’s next procurement project will likely involve a collaborative combat aircraft (CCA) to build combat mass.

Interestingly, earlier this week, Singapore and Australia signed the Industrial Base Resiliency Arrangement (IBRA), which establishes a practical framework for closer defence industrial cooperation between the two nations.

The IBRA “allows both countries to engage in cross-sustainment of common defense platforms, examine priority delivery requests for defence orders, streamline equipment transfers, foster defence industry partnerships, and facilitate information exchanges to mitigate supply chain risk.”

When it comes to common defense platforms, it’s not hard to imagine that the MQ-28 Ghost Bat could be in the RSAF’s thoughts. At the same time, the F-35A and the P-8A maritime patrol aircraft will also offer commonality with Australia once they arrive in RSAF service.

Singapore has a history of studying major defense programs years before making procurement decisions. Whether it intends to buy the Tempest in the future or not, the report is the first known indication that Singapore is formally examining possible links to GCAP, and looking at sixth-generation combat aircraft more generally.

Contact the author: thomas@thewarzone.com

An Indian student from Bihar says he has been charged over ‘Cockroach’ protests despite being in Russia for the last four months. Hundreds of students across India have faced arrest for participating in the youth-led demonstrations.

Aquilino’s uncle David Bonomi said his nephew was a “friendly, talented artist” who had been killed in a “brutal, cruel and evil manner”.

He said the family had reported him missing as it was “very unusual for him not to have been in contact” as he called his mother every day.

Speaking earlier about the review of the four unexplained deaths, Det Supt Rachael Bentley, from Devon and Cornwall Police, said: “As a major crime investigation team we were informed by the coroner’s officer for His Majesty’s Coroner that there were four deaths at Sandy Lodge.

“As part of the investigation, a detective inspector, separate to the investigation but within major crime, did a review of those deaths, and that included commissioning some more forensic work, some CCTV, and statements.”

Inquiries were ongoing and Desborough was “not a suspect at this time”, Bentley said.

“We don’t believe there is a link at this time, but I said it’s an ongoing investigation,” she said

She said police attended each of the deaths at Sandy Lodge and inquiries suggested natural causes but coronial investigations were paused when Desborough was arrested for murder.

Last week, two of OpenAI’s most advanced AI models were reported to have “escaped” a controlled testing environment and hacked Hugging Face, a totally separate AI company, moving from one computer system to another to complete their task.

Reuters reported that the models exploited vulnerable code written by a customer of yet a third independent AI company, Modal Labs.

This is likely the first incident of an AI “agent” – an AI system that can make decisions and take actions – acting autonomously, offering a rare glimpse into how these systems can plan, adapt and pursue goals with minimal human intervention.

Al Jazeera breaks down what happened, how AI agents are able to act independently, and what that might mean for the future of AI safety.

What happened?

OpenAI decided to test the autonomous abilities of its models by removing standard safety measures to see what would happen. The experiment was carried out in an isolated internal virtual testing environment known as a “sandbox” which has no access to the internet, and which it calls “ExploitGym”.

Below is a play-by-play account of events during the OpenAI-Hugging Face incident.

1. On July 9, during OpenAI’s internal cybersecurity test, researchers presented two AI models – GPT-5.6 Sol, one of OpenAI’s most powerful models released in June,  and another “even more capable” version – with a series of software vulnerabilities and asked them to create hacks to address them in the isolated environment.
2. Both models attempted to solve the test by finding a way to access the internet. Instead of working with the information they had been given, the AI models found a weakness in the test environment – known as a “zero-day vulnerability” – which they exploited to “escape” the restricted environment, eventually making their way to a system which had internet access by hopping from computer to computer. They went to “extreme lengths to achieve a rather narrow testing goal” and “found ways to gain access to secret information that it could use to cheat the evaluation”.
3. By gaining this access, the models were able to request increased access and then move through the system until they finally reached a computer with internet access. The models were then able to breach Hugging Face systems, a company entirely unconnected to OpenAI, which operates as a repository for AI tools and models. The two AI agents gained access to its system to scour it for information on how to complete their task.
4. The models ultimately obtained solutions to the problem from Hugging Face’s database.
5. The models dutifully returned “home” to complete their task.
6. The breach was detected and contained by Hugging Face’s security team sometime later. According to Thomas Wolf, Hugging Face’s cofounder, the breach began on July 11 and lasted until July 13. It is unclear how long it took for the breach to be spotted.

How do AI ‘agents’ solve problems?

In order to understand how AI agents work, it’s important to differentiate them from traditional AI chatbots.

Generative AI creates text and images based on human prompts, while AI agents go a step further by making decisions and taking actions independently in pursuit of a specific goal, similar to a human being. This is known as “agentic AI” because the model has agency.

According to academics at the MIT Sloan School of Management, AI agents build on the abilities of large language models (LLMs) – generative AI models – by allowing them to complete tasks, not just generate answers.

For example, if you ask a traditional AI model to find the cheapest flights, it will provide you with a list of options it has sourced on the internet. An AI agent will strive to compare the flights, check them against your budget and preferences, and, with your permission, book the best option for you.

This shows that while generative AI provides information, AI agents can also make decisions and take action to achieve a goal without necessarily being prompted to.

To show how AI agents work towards a goal, the Sense, Plan, Act, Evaluate (SPAE) loop can be drawn upon. Originally developed in robotics, this describes a continuous cycle in which an AI agent gathers information, decides what to do next, takes action and checks the results before repeating the process. That process looks like this:

1. Goal: determine the task that needs to be completed.
2. Assess: gather and analyse information from the available environment.
3. Obstacle: if something is inhibiting the task being completed, check for additional information and resources to move forward.
4. Plan and decide: evaluate different options to complete the task and choose an appropriate one.
5. Action: execute the chosen option.
6. Evaluate: assess the outcome and whether the chosen action moves closer to achieving the goal.
7. Adapt: if further actions are needed, gather more information or try a different approach.
8. End state: the cycle continues until the goal is reached.

Could AI act beyond human control?

Incidents like the OpenAI-Hugging Face one have raised concerns about the potential for extreme capabilities of AI systems.

This is all valuable. Agentic AI’s market value is expected to grow from $5.1bn in 2024 to $47bn by 2030, according to Statista, in a clear indication of how quickly it is being adopted.

AI developer Anthropic urged the industry last month to slow the advance of the most powerful systems, saying that the speed at which AI models are carrying out tasks is too rapid. Last week, US Congress members put forward a bipartisan bill which would require developers of AI systems to create a “kill switch”, meaning these advanced models could be shut down if they posed a catastrophic risk.

Anthropic’s warning came a week after researchers at the University of Toronto carried out tests showing that AI could create a “worm” capable of adapting how it hacks while moving from device to device until it eventually takes over a computer network.

These dystopian-sounding developments came in advance of OpenAI boss Sam Altman saying on Saturday that AI has reached “the singularity” referring to the point at which AI surpasses human intelligence and becomes increasingly difficult to control.

Sean O hEigeartaigh, a research professor at the University of Cambridge, told Al Jazeera that he does not believe singularity has been reached quite yet.

“By the definition I’m familiar with, the singularity is the hypothetical point where AI is so capable and advancing so fast that it is transforming civilisation in ways we cannot control or predict,” he explained.

“This would most likely be through AI rapidly designing future generations of AI: recursive self-improvement. We aren’t there yet.”

However, he added: “The most advanced current models frequently make efforts to avoid being shut down in evaluation tests, and more capable future models will be better at bypassing ‘kill’ switches.”

Altman argued that such rapidly advancing AI is good for the world, but his comments have prompted further concerns about a new reality in which AI systems become unstoppable. How much of that is true and how much remains in the realms of science fiction is up for debate.

Concerns about AI range from the notion that it could “want” to “take over”, to making its own long-term plans, controlling the internet and operating infinitely.

While not quite amounting to full control of the internet, another theory, known as the dead internet theory, supposes that the World Wide Web will in the future mostly be filled with automated bots and AI-generated content rather than authentic human activity.

Many concerns raised by academics, however, are centred less on agentic AI’s intelligence, but on its ability to make judgements. MIT researchers have highlighted that “hallucinations”, which describe moments when an AI agent relies on the wrong data, can lead to grave mistakes. The Center for Strategic and International Studies (CSIS) echoed this, saying “a system might be smart enough to execute a task perfectly yet fail to realise that a sudden change in the local situation makes that task a catastrophic mistake”.

Another concern that has been echoed for a while is for the labour market, if AI becomes too capable. A study by MIT, carried out in November, found that agentic AI could already replace more than 10 percent of US jobs.

The graphic below highlights some of the common misconceptions and fears about AI and the current reality.

Israel will head to national elections on October 27, marking the country’s first vote since the October 7, 2023 Hamas attack that triggered the Gaza war and later expanded into conflicts with Lebanon and Iran. The election is widely seen as a defining moment for Prime Minister Benjamin Netanyahu, whose political future faces its toughest test in years.

Although opinion polls suggest Netanyahu is heading toward defeat, Israel’s fragmented parliamentary system means election outcomes often depend on coalition negotiations rather than outright victories, leaving several possible paths to power.

Polls Signal Trouble for Netanyahu

Recent surveys indicate declining public confidence in Netanyahu, whose long standing reputation as Israel’s security leader suffered after the October 7 attack.

While many Israelis have supported military operations against Hamas, Hezbollah, and Iran, dissatisfaction has grown over the government’s handling of domestic issues, including the relationship between religion and the state.

Despite the unfavorable polling, Netanyahu remains one of Israel’s most experienced political figures and has repeatedly returned to power after seemingly insurmountable political setbacks.

Who Are Netanyahu’s Main Challengers?

Several political figures are seeking to capitalize on Netanyahu’s weakened position.

Former military chief Gadi Eisenkot has emerged as one of the strongest contenders. Having lost his son during the Gaza conflict, Eisenkot has built a reputation as a respected security figure while portraying himself as an honest alternative to the current leadership.

Former prime ministers Naftali Bennett and Yair Lapid have reunited politically after previously forming the coalition that briefly removed Netanyahu from office in 2021. Their earlier government brought together parties from across Israel’s political spectrum, although it lasted only 18 months.

Another challenger is former Defense Minister Avigdor Lieberman, once a close Netanyahu ally. Lieberman later became one of his fiercest critics, accusing him of failing to adopt a sufficiently tough security policy.

How Israel’s Election System Works

Israel elects its 120 member Knesset through a nationwide system of proportional representation.

Rather than voting directly for a prime minister, citizens vote for political parties. Seats are distributed according to each party’s share of the national vote, provided they receive at least 3.25 percent, the equivalent of four parliamentary seats.

Because no party has ever secured an outright majority, governments are always formed through coalition negotiations among multiple parties.

This coalition system gives smaller parties significant influence over government formation and policymaking, often making them decisive kingmakers after elections.

Why Coalition Politics Matter

Coalition governments have become a defining feature of Israeli politics.

Since 2019, repeated political deadlock produced multiple elections before Netanyahu returned to power in 2022 with the country’s most right wing coalition to date.

His governing alliance has relied heavily on ultra Orthodox Jewish parties, whose demands, particularly regarding exemptions from compulsory military service, have generated growing public controversy during wartime.

Following disagreements, some coalition partners have already left the government, although they have continued providing parliamentary support on key votes.

The Main Parties in the Election

Netanyahu’s coalition includes:

• Likud
• Religious Zionism
• Jewish Power

The opposition currently consists of:

• Yashar, led by Gadi Eisenkot
• Together, the alliance between Naftali Bennett and Yair Lapid
• Israel Our Home, led by Avigdor Lieberman
• Arab parties including Hadash, Taal, Raam, and Balad
• The left wing Democrats, headed by former general Yair Golan

The political landscape could still change before candidate registration closes, as parties may merge, split, or withdraw from the race.

Why This Election Matters

The October election will shape Israel’s political direction at a time when the country remains engaged in multiple regional conflicts and faces mounting domestic challenges. While polls currently favor opposition forces, Israel’s coalition based electoral system means the final outcome will depend less on which party wins the most votes and more on which leader can assemble a governing majority in parliament.

Analysis

The 2026 Israeli election is not simply a referendum on Benjamin Netanyahu but a broader test of whether Israeli voters want continuity or political renewal after years of conflict and instability. Netanyahu enters the race weakened by security failures linked to the October 7 attacks and growing public frustration over domestic governance, yet his long record of coalition building means he cannot be discounted. Even if his Likud party falls short, post election negotiations could still determine his political survival.

For the opposition, electoral success alone may not be enough. Parties ranging from centrists to left wing and Arab factions must overcome ideological divisions to build a stable coalition, a challenge that has repeatedly undermined previous governments. The election therefore highlights a recurring feature of Israeli politics: governments are decided not only at the ballot box but also through complex coalition bargaining that can reshape leadership long after votes are counted.

With information from Reuters.