Despite investor fears, private credit is far from a meltdown because not all risks are the same.
The cracks in the private credit market appear to be widening.
Private credit is a significant alternative to syndicated bank loans as a source of corporate capital provided predominantly by private equity (PE) firms. The market is heavily involved in financing data center capacity, which is burgeoning along with the demand for artificial intelligence. Investors fear that the artificial intelligence capital spending boom poses a threat to the software industry and may be creating a market bubble that leaves private credit funds overly exposed.
Yet there are reasons to believe the potential damage to the private credit market remains manageable and contained.
This article appears in the May 2026 issue of Global Finance Magazine. .
To be sure, when auto parts seller First Brands announced its bankruptcy late last year, which was financed by a credit fund sponsored by investment bank Jefferies Group, it raised alarms in some quarters. Underscoring the opacity of private credit, which is largely unregulated, were allegations that First Brands had borrowed against the same receivables more than once. Meanwhile, defaults elsewhere in the credit sector hit a record high in 2025, according to Fitch Ratings, reaching a 9.2% rate, more than double the 3.6% recorded in 2023. Default rates this January continued upward, reaching 9.4% before slightly easing in February to 5.4%.
As the First Brands financing reveals, banks as well as PE firms are involved in private credit, either by financing investment funds sponsored by Ares Capital, Antares, Apollo, Blackstone, Blue Owl, and the like, or via funds of their own. With pension funds, insurance companies, and increasingly, individuals investing in private credit, law firm Quinn Emanuel warned in a March client memo that the trend may pose systemic risk, even though private credit is still a relatively small part of the overall loan market.
“The result is a transmission chain that runs from the technology companies, through private credit originators, to the regulated banks that lend to them, to the insurers and pension funds that invest alongside them, and potentially to the retirement accounts of ordinary Americans,” the memo’s authors warned.
Only a minority of small corporate borrowers are in trouble, and companies with EBITDA of $25 million or less experienced significantly higher default rates—15.8%—than larger companies in 2025. Healthcare and consumer companies have higher default rates. Fitch also notes that realized losses for first-lien lenders have been limited, with most cases resulting in full or high-percentage recoveries.
Notably, private credit default rates historically tend to run higher than those on broadly syndicated loans, a trend some observers attribute to more customized, and sometimes distressed, lending terms. The January uptick was largely driven by “distressed” exchanges and payment-in-kind (PIK) interest, according to Fitch.
AI Anxieties
Alen Lin, Fitch Ratings
Concerns are growing about PE funds exposed to software. Investors worry that AI will disrupt the software industry, leading to defaults within portfolios of private-credit loans to the sector. But most such funds are diversified, and even those that aren’t may not be as vulnerable to disruption by AI as investors fear. That’s because the large language models underpinning AI require application program interfaces to operate, so software may still be needed to facilitate the technology’s use.
“Implementing AI still requires significant effort to get it to work in a particular environment,” Alen Lin, senior director of North America corporates, technology, at Fitch Ratings, told audiences at a recent webinar held by the firm.
Of course, much depends on the type of application involved. As Fitch notes, companies producing software that is either deeply embedded in enterprise technology systems, leverages proprietary data, or operates in more regulated industries like health care and financial services could benefit from the development of AI. By contrast, those producing software for applications that aren’t so embedded, such as digital content creation or certain types of analytics and visualization tools, are more exposed to AI disruption.
Even if the AI bubble bursts, that risk is unlikely to evaporate, Lyle Margolis, senior director in Fitch’s corporates group, where he manages its private credit business, said in an interview with Global Finance. “AI is here to stay and is going to be disruptive to certain segments of the software market,” he says.
Yet the risks may be overstated. Whether measured by leverage, interest coverage, or EBITDA, “the trends in the software sector have actually been somewhat positive,” he noted. Refinancing risk for the sector is relatively benign. And data-center build-out provides one of several “significant tailwinds” for private credit in the software sector, added Dafina Dunmore, Fitch’s senior director of North American non-bank financial institutions.
Another mitigating factor: Redemption risk, which can see large outflows of capital. However, it is limited largely to business development companies (BDCs), a more liquid, retail-oriented variety of private-credit investment vehicle. Blue Owl, for example, recently blocked redemptions at one of its BDCs and liquidated some others. And the $33 billion Cliffwater Corporate Lending Fund, the largest US private-credit interval received redemption requests on 14%.
Although defaults are rising for these portfolios, redemption risk isn’t a problem for most credit funds, because investors are locked in until maturity. In addition, stress is concentrated in direct lending: corporate loans that fund working capital and growth.
Hidden Risks
To be sure, many such risks may be hidden, given private credit’s opacity. Blue Owl’s exposure to software loans, among the highest in the industry, is roughly twice as extensive as its public filings indicate, according to a recent analysis by the Wall Street Journal. The paper also found other PE firms whose credit funds exhibit software exposure exceeding what’s publicly disclosed include Blackstone, Ares, and Apollo.
Investor worries may exacerbate Blue Owl’s redemption woes since its data center financing deals involve accounting practices that obscure the risk involved. The main source of concern is likely Blue Owl’s $27.3 billion financing of Meta’s Hyperion data center in Louisiana.
Yet, S&P rates the bond backing the deal, called Beignet, as Meta’s obligation, reflecting that it bears the risk of default. Indeed, investors seem to like that cash-rich Meta stands behind Beignet. The bond was recently spread over a bond financing the CoreWeave data center, which isn’t backed by the hyperscaler.
Still, some wonder if the risks are adequately priced into these issues.
Quinn Emanuel warns that the vagaries of Meta’s accounting treatment may lead to litigation between the parties over who bears the loss if AI fails to meet expectations and Meta chooses not to renew the lease. Blue Owl finances an Oracle data center in similar fashion, but that bond is trading at a discount to Meta’s, partly because Oracle doesn’t back it and partly because the ultimate tenant is less financially stable OpenAI.
“When we rate data centers, to some extent we look at the credit quality of the ultimate tenant,” says Victor Leung, vice president for project finance at ratings firm DBRS Morningstar.
This type of complexity led Quinn Emanuel to warn in its March 13 memo that, “the AI data center buildout—projected to require $5.2 trillion in infrastructure investment by decade’s end—has spawned complex financing structures that are generating significant litigation risk.”
Mark Koziel, CEO of the International Association of International Certified Professional Accountants and president-CEO of the American Institute of CPAs, says he would raise the issue of current accounting rules for such financing arrangements at an upcoming meeting with the Financial Accounting Standards Board. Also last month, the US Department of the Treasury said it would meet with industry and investor representatives to discuss private credit’s potential risk to the financial system.
Thus far, warnings of a private credit meltdown seem overstated.
Credit funds focused on asset-backed finance (ABF), which is based on the value of a borrower’s assets and is the fastest-growing sector in the market, are relatively immune to stress, thanks to their self-liquidating feature. In contrast to direct loans, principal on asset-backed financings is paid back during the life of the loan. As a result, ABF funds don’t face the same refinancing risk as direct lenders.
Sponsors of direct lending funds “don’t have the benefit of those cash flows directed to pay down the loans,” notes Fitch’s Margolies.
Apart from First Brands’ receivables deal with Jefferies, the ABF segment has yet to be fully tested. But a test may soon be underway: Beignet is also asset-backed. Or sort of.
Debt principal remains outstanding at each renewal point, so it isn’t completely self-amortizing. As a result, DBRS Morningstar’s Leung notes, “you face a risk that your facility will lose its source of revenue.” Hence, Meta’s guarantee that it will make up any loss facing investors if it fails to renew the lease and the facility’s residual value falls below a certain threshold.
That scenario is not far-fetched, Quinn Emanuel warns, noting that it’s expensive to convert an AI data center to general-purpose cloud computing or other uses: “If demand for AI computing contracts, these facilities may function as stranded assets with limited alternative use and depressed liquidation value.”
Finnish authorities scramble fighter jets; defence chief says false alarm but warns of potential repeats while Russian war persists.
Finland has stood down its defence forces after sounding an alarm over suspected drone activities in its airspace.
The authorities said on Friday that suspected drone activity above the Helsinki region no longer posed a threat and that the situation was returning to normal hours after launching an emergency response, including the launch of fighter jets and closure of the capital’s airport.
Recommended Stories
list of 4 itemsend of list
The alarm illustrates the tension stalking the region as Finland and the Baltic states eye Russian aggression and daily missile and drone attacks amid Moscow’s continued war on Ukraine.
The Helsinki City Rescue Department had warned the nearly 2 million inhabitants of Finland’s Uusimaa region to stay indoors starting about 4am local time (1:00 GMT), as fighter jets were scrambled. Helsinki’s airport was also closed for about three hours.
Later, President Alexander Stubb wrote on X that authorities had “demonstrated their readiness and capacity to react”, adding that the country was now facing “no direct military threat”.
Kimmo Kohvakka, director general for rescue services at the Ministry of the Interior, called the response a “precautionary measure” and said “daily life can continue.”
The incident arose amid growing concerns about regional spillover from the Ukraine war.
The Baltic states of Estonia, Latvia and Lithuania have reported a series of suspected Ukrainian drones headed for Russia entering their airspace, prompting domestic criticism over their ability to respond to military threats.
The situation has led to a full-blown government crisis in Latvia. Prime Minister Evika Silina resigned on Thursday after a coalition partner pulled support. The move followed the ousting of the defence minister after a drone crashed at a fuel storage facility.
In March, two drones crossed into Finnish territory and crashed after flying low over the sea and southeastern Finland.
Finnish authorities did not indicate the source of Friday’s drone activity.
However, defence forces operations chief Kari Nisula suggested that Finland had received information from Ukraine about drones potentially straying into the country, according to the Reuters news agency.
The military head added that there was no evidence that drones had entered Finland, but that such situations could happen again as long as Russia continues its war on Ukraine.
Prisoner swap
The incident in Finnish airspace unfolded as Ukraine maintained its drone attacks on Russian oil and energy infrastructure, and Kyiv continued counting the costs of a huge strike that killed two dozen people.
Russia’s Ministry of Defence said on Friday that its air defence systems shot down 355 Ukrainian drones targeting Moscow overnight, as well as the border regions of Belgorod, Bryansk and Kursk.
Among the targets was an oil refinery in the central city of Ryazan, about 200km (125 miles) southeast of Moscow, according to the commander of Ukraine’s drone forces.
Fire and a plume of smoke rise in the vicinity of the Ryazan oil refinery, May 15, 2026 [Reuters]
The attack killed three people and wounded 12, regional Governor Pavel Malkov wrote on Telegram. Two high-rise apartment buildings were struck, he said, while debris fell on the grounds of an industrial enterprise.
Meanwhile in Kyiv, the death toll from a Russian barrage on an apartment building on Thursday rose to at least 24 people, including three children, Ukrainian President Volodymyr Zelenskyy said. Forty-eight people were wounded.
Amid the ongoing violence, Russia and Ukraine have moved ahead with a prisoner swap that saw 205 POWs repatriated on each side on Friday. It was the first step of a swap that is planned to ultimately see 1,000 people on each side return home.
The two sides also conducted an exchange of those killed in the fighting, with Russia handing 526 bodies to Ukraine and receiving 41 in return. Both Kyiv and Moscow thanked the United Arab Emirates for mediating the swap.
Zelenskyy wrote on social media that most of the prisoners returned to Ukraine had been in Russian captivity since 2022.
“We will continue to fight for every single person who remains in captivity,” he said.
Choi Seung-ho, head of Samsung Electronics’ largest labor union, speaks to reporters Wednesday after a hearing on an injunction against a labor strike filed by Samsung at Suwon District Court. Photo by Yonhap
Samsung Electronics Co. and its labor union failed to reach a wage agreement Wednesday, raising concerns over a major strike later this month that could disrupt operations at the world’s largest memory chipmaker.
The breakdown came after two days of government-led mediation talks that had been viewed as a last-ditch effort to avert the strike scheduled for May 21.
Union and management have remained sharply divided over performance-based bonuses tied to the company’s earnings related to artificial intelligence (AI).
The union has demanded performance bonuses equivalent to 15 percent of operating profit, along with the removal of the payout cap and the formal institutionalization of the bonus system.
The management, meanwhile, proposed allocating 10 percent of operating profit to bonuses and offering a one-time special compensation package that it said exceeds industry standards.
“Because the differences between the labor union and management did not narrow, we requested mediation and waited for nearly 12 hours, but the proposal only worsened,” Choi Seung-ho, head of Samsung Electronics’ largest labor union, told reporters after the meeting at the National Labor Relations Commission office in the administrative city of Sejong.
Choi said some 41,000 unionized workers have expressed their intention to take part in the general strike, adding that the number could rise to more than 50,000.
“It is meaningless to wait any longer,” Choi said. “We do not plan to hold an illegal strike. We will proceed in a legitimate way.”
Choi added that the union now will focus on responding to Samsung’s request for an injunction restricting the union’s planned strike.
Later Wednesday, the Suwon District Court concluded a closed-door second hearing attended by about 30 people, including lawyers and officials from both sides.
During the hearing, the union argued that the strike would be carried out lawfully within a limited period and that it had no intention of illegally occupying company facilities, making an injunction unnecessary.
The court is expected to decide by May 20 whether to grant the injunction.
Following the breakdown in talks, Samsung Electronics expressed regret over the suspension of the mediation process, while pledging to continue efforts to engage in dialogue.
“The post-mediation process, which the government worked hard to arrange, unfortunately collapsed after the union declared negotiations broken down,” the company said in a press release. It, however, vowed to continue making sincere efforts until the very end to prevent the worst-case outcome from materializing.
The labor dispute at Samsung Electronics, the world’s largest memory chip maker and South Korea’s most valuable company, has raised concerns that a walkout could disrupt production and upend the semiconductor supply chain, as well as hurt the broader economy overall.
Observers say that if a full-scale strike takes place, losses to the South Korean economy, which is heavily dependent on exports, could exceed 40 trillion won (US$26.8 billion).
South Korea’s exports reached a record $219.9 billion in the first quarter of 2026, driven by strong global demand for AI data centers. Semiconductor exports were a major contributor, surging 139 percent from a year earlier to $78.5 billion as investment in AI-related servers accelerated.
Some observers have speculated that the government could invoke emergency arbitration powers to prevent further escalation.
Under South Korea’s labor laws, the labor minister may order emergency arbitration when industrial action is deemed likely to endanger public welfare or seriously harm the national economy.
If invoked, all strike actions would be prohibited for 30 days while mediation and arbitration procedures are conducted by the commission. Emergency arbitration powers have been exercised only four times in South Korea’s history.
A commission official declined to comment on the possibility, saying, “It is not something we are reviewing.”
Copyright (c) Yonhap News Agency prohibits its content from being redistributed or reprinted without consent, and forbids the content from being learned and used by artificial intelligence systems.
BRITISH Airways’ multi-million pound superjumbo refit faces certification delays over fears crew cannot safely restrain drunk passengers in its new business class seats.
The airline is in the process of upgrading its Airbus A380 fleet with its latest Club Suite, which comes with a sliding privacy door.
Sign up for the Travel newsletter
Thank you!
But the makeover could hit delays because of concerns over how staff would deal with an air rage passenger on the upper deck.
BA plans to move a small section economy seats off the top floor and replace them with a larger Club World cabin.
Its passenger restraint kit is understood to be approved for economy and premium economy seats – not the new suite-style business seats.
That could leave crew with a major problem if a passenger became violent or disruptive upstairs.
Sources said hauling a violent passenger down the A380’s narrow staircases could put crew and other passengers at risk.
The first aircraft are currently being worked on in Manila, Philippines, as part of the refurbishment programme.
Industry sources have also suggested there may be certification concerns over the weight of the new business seats, which include motors and sliding doors.
Extra weight on the upper deck could affect the plane’s payload limits.
However, any delay may also be linked to wider supply chain issues affecting premium aircraft seats across the industry.
British Airways said the A380 refit programme remains on schedule for 2026.
CHONGQING, China — Three years ago, in the idyllic town of Woodside south of San Francisco, the United States and China held their first high-level talks on the dangers posed by artificial intelligence. President Xi Jinping and his longtime foreign minister appeared serious in their conviction that a channel should be a established between Beijing and Washington — a red phone for AI in case of emergencies.
They authorized a diplomatic effort that would begin in 2024 in Switzerland, only months before the U.S. presidential election. A large U.S. delegation arrived with high hopes that were abruptly dashed, according to four sources who attended the talks. The Chinese contingent dismissed American concerns over runaway AI as academic, almost theoretical, quickly turning the conversation to export controls seen in Beijing as yet another U.S. effort to hold China back.
“They naturally view any American diplomatic initiative involving limitations or restrictions of one flavor or another on a capability as being a trap,” Jake Sullivan, U.S. national security advisor under President Biden, said in an interview.
Despite the distrust — and Democrats losing the White House to Donald Trump — an accord was struck in November of that year in Peru, where both sides agreed to keep AI out of the command and control of nuclear weapons.
“It was a breaking of the seal that we could actually do something on AI,” Sullivan said. “In the transition, I told the incoming Trump team that they should really pick up that dialogue. But the Trump administration’s view was just far more laissez-faire, and they didn’t seem particularly interested in it.”
“That’s all changed in the past few weeks,” he added.
A Trump administration once eager to gun for technological supremacy is now, for the first time, reckoning with the power AI could unleash if left unchecked.
In a surprise reversal, quiet discussions have taken place ahead of President Trump’s state visit to China this week to explore reviving talks on an emergency channel, officials told The Times, prompted by shared alarm in Beijing and Washington over the debut of Mythos, Anthropic’s powerful new model.
One senior administration official told reporters Sunday that the White House was looking to create a channel of communication for AI like others that they have “in many areas that have intense focus with the U.S. and China.”
“I think what that channel of communication looks like, its formality and what that looks like, is yet to be determined,” the official said, “but we want to take this opportunity with the leaders meeting to open up a conversation. We should establish a channel of communication on that matter.”
Mythos’ capabilities are seen across the industry and government as those of an unprecedented cyberweapon, able to infiltrate and exploit digital communication systems — including government databases, financial institutions and healthcare programs — with untold consequences.
Whether an announcement will come to fruition this week is not yet clear. Any talks between the United States and China over AI regulations — designing some kind of arms control agreement governing the use of a technology that neither side fully understands or controls — will be fraught with suspicion, misunderstandings and risk, experts say.
“Right now, there is almost no support from U.S. policymakers to engage in formal discussions on AI governance with China,” said Aalok Mehta, director of the Wadhwani AI Center at the Center for Strategic and International Studies.
“The logic is that this is a winner-takes-all race,” Mehta said, “and that it’s imperative to accelerate AI progress to ensure that the United States wins that race.”
America in the lead
China would enter those discussions with a powerful argument, that U.S. leadership in AI — and the prevailing strategy of American AI companies — is propelling the world to a fraught frontier.
Every major U.S. player in the arena — OpenAI, Google, Anthropic, Microsoft and Meta Platforms — is racing to be the first to build a model capable of artificial general intelligence, or AGI, a threshold without a common definition, but that most agree will require a model to perform any intellectual human task.
The prevailing theory is that the first to achieve AGI will secure a prize that multiplies itself: a self-training, recursively improving intelligence, growing exponentially and leaving all competitors in its wake.
Chinese companies, by contrast, are following a state-sanctioned strategy focused on integrating AI into siloed industries and systems, training models to improve individual tasks and accelerate growth in a more tailored approach.
“The Chinese believe there is no single race, but multiple races,” said Scott Kennedy, senior advisor on Chinese business and economics at the Center for Strategic & International Studies. “The U.S. is focused on achieving AGI, while China is focused on diffusion and applications of AI into the rest of their economy — manufacturing, humanoid robotics, all aspects of the internet of things.”
China scholars, AI industry insiders and successive administrations have questioned Beijing’s strategic thinking and forthrightness.
“It’s so baked into the community here that AGI will have this transformative potential that people can’t believe China isn’t focused on this, as well,” said Matt Sheehan, a scholar of global technology issues at the Carnegie Endowment for International Peace with a focus on China. “It says it’s focused on applications, but is that a fake out for an AGI program hidden in the mountains somewhere?”
But most insiders believe that Beijing’s guidance to Chinese companies reveals its true intentions.
“They are not as AGI-pilled as the United States is, and I think that remains the case today,” Sullivan said, “so they regarded a lot of the conversation in the U.S. around extreme frontier risk — misalignment and loss of control — as a bit abstract, and not really as relevant to how they saw AI diffusing in China.”
President Biden greets Chinese President Xi Jinping in Woodside, Calif., in 2023.
(Doug Mills / Pool Photo)
Although China’s progress has exceeded U.S. expectations — especially since DeepSeek released its model over a year ago — the state has focused computer power on specific applications rather than the broad strategy needed to develop more powerful models capable of advancing toward AGI.
“It’s not just chips. It’s money,” Sheehan added. “China’s leading companies are much more financially constrained than U.S. companies. There’s concern over a bubble here, but OpenAI is valued at something near $800 billion. Leading Chinese companies that have gone public are valued at $20 billion. There’s just an orders-of-magnitude gap in available financing.”
Still, some in the U.S. government fear China won’t need comparable computing power if it simply steals the technology wholesale.
Doing so isn’t simple. But last month, in a memo, the White House Office of Science and Technology Policy accused Chinese actors of “industrial-scale campaigns to distill U.S. frontier AI systems,” in effect replicating the performance of the most advanced existing models “at a fraction of the cost.” The memo did not accuse Beijing of endorsing the activity.
In the process, the memo added, carefully constructed security protocols are deliberately stripped away.
China’s negotiating advantage
Whatever its strategic calculus may be, China would enter talks with the Trump administration trailing in the race — while disagreeing on the nature of the finish line.
AGI, in theory, could reach a stage of recursive self-improvement that results in a loss of human understanding or control. But if it is only the Americans, and not the Chinese, seeking to reach that threshold, then who is responsible to stop it?
Daniel Remler, who led AI policy at the State Department during the Biden administration and took part in the Geneva talks, cast doubt on Chinese claims of disinterest in AGI and ignorance of its risks. China falling behind in the race is no strategic design, he said.
“Chinese technologists are close observers of the U.S. AI ecosystem, and sometimes they say what they think,” Remler said. “Many were impressed by the [Mythos] model to the point of despair. Leaders in China’s top AI labs have been vocal in recent months, even before Mythos, about how compute-constrained they are at the frontier. Some have said they may never catch their American competitors.”
Talks at this point in the race could follow a familiar pattern in the recent history of U.S.-China diplomacy, in which Beijing claims it is behind the United States in development, ultimately securing a handicap and greater concessions at the negotiating table.
In other competitive domains — such as with China’s entry into the World Trade Organization and in cybersecurity negotiations between Beijing and the Obama administration — agreements were ultimately reached that Washington believes in hindsight disadvantaged American companies.
The Trump administration, Remler added, “needs to approach AI diplomacy with China with clear-eyed expectations anchored to our own national interests.”
Silicon Valley itself is divided over regulating AI. Anthropic, which was founded on concerns that other AI companies were failing to take safety and alignment concerns seriously, raised alarms over Mythos, its own model, to the Trump administration, a moment that has prompted reflection at the White House on the best path forward.
Spooked after meeting with leaders from America’s top banks over their vulnerabilities, Treasury Secretary Scott Bessent internally advised U.S. government reviews of future model releases — a practice already underway in China, where the training parameters for models, known as “weights,” have been publicly released.
Even the suggestion of government oversight sparked backlash from Silicon Valley. Last week, the White House sent out a memo to reassure industry allies that submitting new models for federal review would be strictly voluntary.
If talks ultimately resume between Washington and Beijing on AI, experts believe the negotiations would be far more complex than those that resulted in arms control agreements governing nuclear weapons in the Cold War.
The superpowers would not only be discussing threats of instability to the global financial system, but also fears of proliferation — advanced AI tools getting into the hands of bad actors interested in using bio- or cyberweapons that could target both countries.
And they ultimately would have to decide whether to discuss regulating the integration of AI into the Chinese and U.S. militaries, an almost unfathomable goal between the world’s biggest adversaries, where trust is lowest and verification would be hardest.
Those in the industry who most fear what artificial superintelligence could bring have told the Trump administration that talks with China are an existential necessity.
Dario Amodei, the chief executive and co-founder of Anthropic, speaks at an event in New York in 2025.
(Michael M. Santiago / Getty Images)
But even within Anthropic, which has championed diplomacy, there are concerns that Beijing could exploit its current disadvantage to entangle American industry at the cusp of its crowning achievement.
Rather than pushing for a single sweeping agreement, industry insiders are advising the administration to pursue targeted deals with Beijing to mitigate specific risks, like the pact on nuclear command and control, two industry sources said.
In private, both Xi and Chinese Foreign Minister Wang Yi seemed to understand that the gravity of the emerging technology before them required some form of cooperation, Sullivan said.
“At a conceptual level, I believe they had a conviction on that and authorized it,” Sullivan said, “but I believe their level of urgency was considerably lower than ours, and saw this as a longer-term process that would play out over time.”
“Their level of urgency and their stake in it has gone up,” he added.
TAIPEI, Taiwan — A resolute Secretary of State Marco Rubio took to the White House lectern Tuesday and declared the United States, under President Trump’s leadership, had launched a bold new operation to reopen the Strait of Hormuz, based on the principle that international waterways must remain free.
An hour later, Trump walked it all back, ending the complex military endeavor after less than a day.
It was just the latest evidence to America’s allies that the word of the U.S. government is subject entirely to the president’s whims. And such is the worry fueling concerns in Taipei ahead of Trump’s state visit to China this week.
Privately, senior administration officials have assured Taiwanese leadership ahead of the trip that Trump has no intention of changing long-standing U.S. policy on the island, two sources familiar with the discussions said — a stance of “strategic ambiguity” that has avoided any declarative statements on Taiwanese independence since it was coined by Henry Kissinger 55 years ago.
A White House official was definitive that U.S. policy toward Taiwan “remains the same as the first Trump administration.”
“The U.S. One China policy, as our cross-strait policies are collectively known, is based on the Taiwan Relations Act, the three U.S.-PRC Joint Communiques and the Six Assurances to Taiwan,” the official said. “There is no change to our policy with respect to Taiwan.”
But Chinese officials told The Times that their president, Xi Jinping, intends to raise the matter as a top priority, knowing that only one person — Trump himself — speaks for the administration today.
Whether Xi can leverage the intimacy of a private audience to shift Trump’s stance, potentially linking it to other U.S. objectives, is the source of significant concern here.
Taiwanese officials fear even the most subtle rhetorical change in policy from Trump could imperil a delicate status quo that has held, to its benefit, for decades. They have similarly sought assurances that the administration will follow through on a pending U.S. arms sale worth over $10 billion, which received approval from Taiwan’s legislature on Friday.
“The most serious scenario would be if President Trump were to make an impromptu statement, such as, ‘I oppose Taiwanese independence,’ particularly if he were to link this to trade, the Iran issue, or a summit agreement,” said Chienyu Shih, of the Institute for National Defense and Security Research in Taiwan. “This would constitute a rhetorical concession of substantial significance to Beijing.”
Rubio told reporters at his news conference Tuesday — with a similar confidence he expressed on the Iran file — that China understands Washington’s long-standing position on the island.
“I’m sure Taiwan will be a topic of conversation. It always is. The Chinese understand our position on that topic — we understand theirs,” Rubio said.
“I think both countries understand that it is in neither one of our interests to see anything destabilizing happen in that part of the world,” he added. “We don’t need any destabilizing events to occur with regards to Taiwan, or anywhere in the Indo-Pacific. And that’s to the mutual benefit of both the United States and the Chinese.”
Trump has suggested a willingness to shift U.S. policy on Taiwan before.
During his initial campaign for the presidency in 2016, Trump openly questioned the One China policy, drawing ire from Beijing for suggesting he might endorse Taiwanese independence. He accepted a call from Taiwan’s president after his victory and would later support significant arms sales to Taipei.
And yet, at a 2017 meeting with Xi, Trump vacillated, telling the Chinese leader he could “deal with” the Taiwan issue in “a matter of months,” according to the Wall Street Journal. The Chinese were reportedly so flabbergasted by the comment that they dismissed it as rhetorical flourish.
“There is concern that the conversation between the two leaders could veer into sensitive territory on the topic of Taiwan,” said Brian Hart, deputy director of the China Power Project at the Center for Strategic and International Studies, “but there are many in the administration who would still appreciate the importance of general continuity in U.S. policy.”
U.S. support for Taiwan’s democratic movement used to be a matter of principle. Today, Washington sees it as a matter of national security. Over 60% of semiconductors are produced in Taiwan, including 90% of the world’s most advanced chips. And it is viewed as the clasp of the first island chain guarding against Chinese maritime expansion.
A robust debate between Taiwan’s Cabinet and the opposition in parliament ended Friday not over whether to accept U.S. defense equipment, but over how much to spend. The Legislative Yuan approved $24 billion in purchases — including a defense package passed by Congress in December and the pending arms sale — falling short of Taipei’s $40-billion proposal.
Anticipation for the president’s state visit is high here in the capital city, where local news is filled with questions over the influence Trump’s war in Iran might have on his appetite for supporting Taiwan.
Chinese defense analysts have seen the war as a sign of U.S. weakness. But Taiwanese defense experts have taken away a different lesson: cheap equipment from a lesser military, such as dumb mines thrown in a strait, may just be enough to paralyze a superpower.
The latest U.S. National Security Strategy, released by the Trump administration in December, emphasized the importance of support for Taiwan and the status quo.
But the Taiwanese took note that the strategy also called for an end to forever wars in the Middle East, offering little preview of the president’s sudden strategic pivot on Iran in February, launching a war few saw coming.
What Trump chooses to say in China “might be difficult to predict,” said Jyh-Shyang Sheu, a scholar of Chinese politics and military capabilities based in Taiwan.
But “in Taipei, we are still focusing on the U.S. policy,” he added, “more focusing on what he does instead of what he says.”
The International Air Transport Association (Iata) has urged its European members to consider switching to US-made jet fuel amid rising concerns over possible shortages caused by the Iran oil crisis
13:25, 08 May 2026Updated 15:49, 08 May 2026
Fears remain that there cut be a shortage of jet fuel
European airlines should contemplate switching to US-manufactured jet fuel amid mounting worries over shortages triggered by the Iran oil crisis, a trade body has warned. The International Air Transport Association (IATA), which represents carriers, said its European members could “ease some pressure” by altering the type of fuel they use.
Commercial aviation mainly depends on two fuel grades: Jet A-1, which is utilised across most of the world, and Jet A, which is chiefly used in North America. They are comparable, with the principal distinction being that Jet A-1 has a lower maximum freezing point, offering greater versatility on long-haul and polar routes.
Jet A is predominantly manufactured outside the Gulf, from where fuel supplies are restricted by Iran’s limitations on tankers passing through the Strait of Hormuz. IATA’s director of flight and technical operations, Stuart Fox, stated in a blog that using Jet A “could give airlines facing a possible shortfall in fuel supply more options”.
He proposed this could “help the industry make better use of the fuel we have” and “keep schedules intact”. He continued: “Fuel supply could come under pressure if the war in the Middle East continues.
“Using Jet A, which is produced at scale outside the Gulf, could be a practical way to help ease some pressure on existing supply chains.
“This would have to be done through a controlled transition from one approved fuel grade to another. In normal times, that flexibility might not be noticeable. But in today’s circumstances it’s critical to keeping the whole system moving.”
Mr Fox noted that airlines looking to switch from Jet A-1 to Jet A would need to implement crucial safety precautions, including accounting for the higher freezing point and ensuring crew members are fully briefed on which fuel is on board.
On Friday, British Airways’ parent company International Airlines Group cautioned that its profits would take a hit, anticipating spending approximately two billion euro (£1.72 billion) more than budgeted on fuel this year. Chief executive Luis Gallego stated that he does not believe the group will experience “any interruption for the summer” with regard to fuel supply.
BEIRUT — Confusion reigned on Monday over the fate of a fragile ceasefire between the United States and Iran after a wave of fresh strikes on the United Arab Emirates and Oman, along with reports of attacks on ships in the Strait of Hormuz, undermined confidence in the truce.
The drone and missile strikes, the first since a ceasefire halted fighting in early April, come after the Trump administration launched a wide-scale naval operation on Monday to “guide” stranded maritime vessels out of the vital waterway.
But fears over a return to war have driven another surge in oil prices, pushing them above $114 per barrel — levels not seen since the ceasefire nearly a month ago. Hundreds of cargo ships from dozens of countries remain stuck in the Gulf. And strikes in Dubai have raised concerns about further disruptions to international air travel at one of the world’s busiest airports.
Iran’s state-run news agency, IRNA, said the new U.S. operation was part of President Trump’s “delirium,” after the Islamic Revolutionary Guard Corps warned that passage through the strait required prior approval from Tehran.
“We warn that any foreign armed force, especially the invading American army, will be attacked if they attempt to approach and enter the Strait of Hormuz,” said Maj. Gen. Ali Abdollahi, according to a statement reported by the Iranian state-run Mehr News Agency on Monday.
The operation, which Trump over the weekend dubbed “Project Freedom,” is supported by 15,000 U.S. servicemen and 100 aircraft, according to U.S. Central Command. Their aim is to deny Tehran control over the strait, a narrow, 21-mile-wide passageway through which a fifth of global energy supplies flows.
“We have more weapons and ammunition at a much higher grade than we had before,” Trump was quoted as saying in an interview with Fox News.
“We have the best equipment. We have stuff all over the world. We have these bases all over the world. They’re all stocked up with equipment. We can use all of that stuff, and we will, if we need it.”
Iran blocked traffic through the strait soon after the United States and Israel launched their campaign on the country. Last month, days after a ceasefire between Washington and Tehran came into effect, the United States enforced its own naval blockade on Iranian ports in a bid to pressure Iran to make concessions in stalled negotiations.
On Monday, Central Command said in a statement that two American-flagged merchant ships were able to successfully transit the strait, while Central Command head Adm. Brad Cooper said the U.S. military sank six Iranian boats and intercepted missiles and drones targeting civilian vessels.
“We have defeated each and every one of those threats through the clinical application of defensive munitions,” he said.
“Project Freedom is a defensive operation, and we have deployed anti-ballistic missile destroyers,” he added. “Ships in the Gulf waters belong to 87 countries, and we urge ships to cross the strait.”
IRIB, Iran’s state-run broadcaster, quoted a senior Iranian military official who denied Cooper’s claim of sunk Iranian boats. The IRGC said in a statement on the messaging app Telegram that claims of commercial vessels or tankers traversing the strait were “baseless and completely false.”
Though Cooper did not clarify if the ceasefire between Washington and Tehran was now over, a raft of attacks throughout Monday spiked fears that the war would restart, spurring sharp price increases in already-jittery energy markets.
The UAE said a fire broke out and three Indian nationals were injured in the Fujairah Oil Industry Zone, a key export hub for the country, after what it described as an Iranian drone attack.
It also accused Iran of targeting a tanker linked to the country’s state oil company Abu Dhabi National Oil Company in the Strait of Hormuz, while the country’s defense ministry also reported four cruise missiles launched from Iran, saying that it intercepted three of them while the fourth fell in the sea.
“These attacks constitute a dangerous escalation and an unacceptable transgression,” said a statement from the UAE’s foreign ministry, adding that it “reserves its full and legitimate right to respond to these attacks.”
Elsewhere, two foreign workers were injured in an attack on a residential building in the Omani coastal province of Bukha, according to a statement from an unnamed security source quoted by the state-run Oman News Agency. Authorities were investigating the incident but did not elaborate on the perpetrator.
The U.K.’s Maritime Trade Operations Center reported on Monday that a commercial vessel was on fire off the coast of the UAE, while a South Korean bulk carrier ship said it suffered an explosion and a fire in its engine room and the cause was being investigated.
Bulos reported from Beirut, Wilner from Washington.
NEW rules will now allow airlines in the UK to axe flights without repercussions this summer due to ongoing fears of a jet fuel crisis.
The Department for Transport has unveiled new measures which will allow airlines to cancel flights up to two weeks in advance, without losing their airport slots.
Sign up for the Travel newsletter
Thank you!
Instead, airlines will be able to group passengers onto other flights that same day, and operate fewer routes a day.
Transport Secretary Heidi Alexander said it would “give families long-term certainty and avoid unnecessary disruption at the departure gate this summer“
While this is said to be “protecting summerholidays” it could see passengers forced onto flights at completely different times that they had booked.
Which? Travel editor Rory Boland said: “It’s not fair for the rules to now be bent in favour of airlines and potentially leave passengers holding the bill.
“Many passengers will understand that disruptions can occur and may be happy to travel a few hours or a day later, but for those on short trips or connecting flights it could mean the trip is no longer worthwhile.
“Before any changes are made, passengers need cast-iron assurances that their rights will not be weakened and that airlines cannot use reform as cover to shift the cost of disruption onto travellers.”
However, it has been backed by Airlines UK, which represents UK carriers, as they said it would “avoid unnecessary flying and continue operating as efficiently as possible while protecting connectivity for passengers and trade”.
While jet fuel shortages – caused by the closure of the Strait of Hormuz, are yet to massively effect UK airlines, many others around the world have ben formed to axe flights.
Budget airlines have spoken amid warnings that the UK faces greater exposure to jet fuel shortages due to the Middle East conflict
05:41, 02 May 2026Updated 07:16, 02 May 2026
Travellers have been concerned at the possibility for disruption this summer due to the continuing Middle East crisis(Image: Getty Images)
Following warnings from a leading analyst over potential jet fuel shortages that could hit the UK during the summer, Europe’s biggest budget airlines have stated they remain confident in their ability to keep flights running as normal throughout the peak holiday season.
Ano Kuhanathan, head of corporate research at insurer Allianz, has warned that the closure of the Strait of Hormuz leaves Britain considerably more exposed than other European countries to supply disruptions. Roughly three quarters of Europe’s jet fuel comes from the Middle East and passes through the vital shipping lane.
He explained: “The UK is Europe’s most structurally exposed market to jet fuel shortages, relying heavily on imports to meet aviation demand and running persistent refining kerosene deficit, leaving it particularly vulnerable to supply shocks.”
Despite these concerns, senior figures at Britain’s top budget airlines have voiced confidence in their capacity to deliver a full flight schedule throughout the summer.
A spokesperson for Jet2 said: “We remain in continual dialogue with our fuel suppliers, as is standard practice. Based on the conversations we have been having, we see no reason not to look forward to operating our scheduled programme of flights and holidays as normal.”
The announcement comes in the wake of a separate warning from Heathrow airport on Wednesday, which stated it anticipates passenger numbers for the remainder of the year to be impacted by the ongoing situation in the Middle East. Laura Lindsay, spokesperson for the price-comparison site Skyscanner, suggested that travel demand is changing rather than vanishing. She told The Independent’s daily travel podcast: “We know that people do still want to get away. It may be reduced internationally and increased domestically, for example.”
Jet2 has revealed that holidaymakers are increasingly making last-minute bookings since the outbreak of the Iran conflict amid growing concerns over the impact of the war and fears surrounding jet fuel supply.
The company said summer passenger bookings to date are up 6.2% thanks to expansion across its airline and package holiday operations, but in a sign of rising unease among travellers, it disclosed that the “booking profile has become increasingly close to departure” due to the Middle East conflict.
It stated it is well shielded from the fuel cost surge triggered by the Iran war for the crucial summer period, adding it is “maintaining frequent dialogue with our fuel suppliers and airport partners on fuel supply”.
Michael O’Leary, Ryanair’s chief executive, said that “the risk of a supply disruption is receding”, with no disruption risk before the end of June. However, he pointed out that the UK faces greater vulnerability compared to other major nations. EasyJet has confirmed it intends to run “a full schedule across its network”. Garry Wilson, chief executive of easyJet Holidays, said: “Our operations remain unaffected, so customers can be confident that not only will their holiday go ahead as planned, but there will be no surprise extra payments.”
Yvonne Moynihan, managing director of Wizz Air UK, said: “We have just launched our biggest-ever network from the UK and in particular from Luton.
“Despite the challenging geopolitical crisis, business goes on as usual. In airlines, we are well used to crises, so we are resilient and we’re well adapted.
“For low-cost airlines like Wizz in the UK, we don’t see any shortage of fuel.”
The airline boss explained that if a shortage were to emerge in the UK, Wizz Air could source fuel from alternative countries – a tactic known as “tankering”.
“We can take more fuel than is required in those destinations,” she said. “We can even fly to other countries and and pit-stop, if you will, if we need additional fuel
“But we’re not seeing an Armageddon situation. We have fuel supply. We have other mechanisms for uplifting fuel.” Wizz Air is Europe’s third-largest budget airline, behind Ryanair and easyJet.
Jet2, easyJet and TUI have all committed to not imposing any additional charges on passengers for fuel price increases.
A gas station in Berlin, Germany, displays the latest per liter prices for petrol, diesel and LPG on Thursday after oil prices on global markets surged to their highest level since 2022. Photo by Filip Singer/EPA
April 30 (UPI) — Oil prices briefly topped $126 a barrel in Asian trade overnight as markets reacted to news the United States might resume its military offensive against Iran and fears the Hormuz Strait might remain closed for much longer than anticipated.
Brent crude, the global benchmark, surged to $126.31, its highest level since Russia invaded Ukraine in 2022, after a report that U.S. military commanders were pitching a campaign of “short and powerful” strikes to U.S. President Donald Trump, to force Iran back to the negotiating table.
The price retreated to around $120 by the time markets in Europe opened on Thursday and continued to fall through the morning. The Brent contract for June delivery was trading at $113.91 a barrel in mid-afternoon trade in London, while American crude for June delivery was changing hands at $104.82.
Oil prices have already elevated since the war began on Feb. 28 and began climbing further on Wednesday after Trump met with executives of U.S. oil companies the previous day about how to deal with supply disruption from the closure of the Strait of Hormuz by Iran, which has vowed it will continue until the United States’ blockade of its ports is lifted.
The group discussed “steps we could take to continue the current blockade for months if needed and minimize impact on American consumers,” a White House official said.
Around 25% of the world’s oil supply passes through the strait and the prospect of it remaining effectively closed for months has set alarm bells ringing in markets as traders’ faith in an early resolution fades and “the reality of the supply situation” sets in.
“The breakdown of talks between the U.S. and Iran, along with President Trump reportedly rejecting Iran’s proposal for a reopening of the Strait of Hormuz, has the market losing hope for any quick resumption in oil flows,” said William Patterson, ING’s Singapore-based head of commodities strategy.
Trump has said he believes the regime in Tehran will blink first, saying they were less afraid of the bombing than the blockade, with U.S. officials banking it will force Iran to shutter oil production because the oil has nowhere to go and the country lacks sufficient storage facilities.
Artemis II pilot Victor Glover (L) and mission specialist Christina Koch meet with President Trump in the Oval Office of the White House on Wednesday. Photo by Graeme Sloan/UPI | License Photo
Government spoke out to passengers booked with carriers like Ryanair, easyJet, Jet2 and Wizz Airs amid fears of fuel supply disruption and potential flight cancellations
Amidst fears of holiday meltdown the UK Government this afternoon issued statement and check sheet(Image: Getty Images)
The Government this afternoon issued a statement to passengers across the UK amid growing concerns over jet fuel shortages and the prospect of flight cancellations. The Department for Transport stepped in to respond following warnings from the European Union.
EU energy commissioner Dan Jorgensen said this week: “Unfortunately, it’s very likely that many people’s holidays will be affected, either by flight cancellations or very, very expensive tickets.”
He added: “Even if we do everything we can do, if the jet fuel is not there, then it’s not there. [Currently] it is primarily a crisis of prices and not yet a crisis of supply, but unfortunately we cannot be sure to prevent a crisis of supply, especially on jet fuel in the future, if the crisis continues.”
Earlier today, President Trump suggested the Iran situation could drag on for weeks, stating he ‘wouldn’t rush’ a deal. The DfT then issued direct guidance to passengers booked with carriers including Jet2, Ryanair, Wizz, easyJet and British Airways.
It said: “There is no current need for passengers to change their travel plans. UK airlines buy jet fuel in advance, and airports maintain stocks to support their resilience. The government is working closely with the aviation industry to monitor risks and minimise disruption to passengers.”
“If your flight is cancelled, you have clear legal rights, including the right to a full refund or re-routing. Read this factsheet for the full picture on the current situation and what it means for you.”
Is there a shortage of jet fuel in the UK?
DtT said: “UK airlines are clear that they are not currently seeing a shortage of jet fuel. It is typically bought in advance, with airports and their suppliers keeping stocks of bunkered fuel to support their resilience.”
Do you need to change your travel plans?
Officials explained: “There is no current need to change upcoming travel plans. Government regularly meets with industry to monitor risks, understand pressures and ensure clear communication with passengers, should circumstances change.
“We recognise that families may be concerned, and that aviation and tourism businesses are operating in challenging global conditions. We are working hand‑in‑hand with industry to help flights keep operating.
“We advise passengers to continue checking with their airlines before they travel, and to check the FCDO travel advice for the latest updates. You should also ensure you have appropriate travel insurance.”
How is the government protecting passengers?
Under UK law, if your flight is cancelled, you are entitled to either a full refund or to be booked onto an alternative flight if you:
depart from an airport in the UK on any airline
arrive at an airport in the UK on an EU or UK airline
arrive at an airport in the EU on a UK airline
For more information about your rights, you can:
What is government doing?
The UK Government said: “Since the closure of the Strait of Hormuz, we have been closely monitoring UK jet fuel stocks and working with airlines, airports and fuel suppliers to ensure passengers keep moving and businesses are supported.
“We continue to plan for a range of contingencies, while focusing on securing a long lasting and workable solution to get shipping flowing freely again through the Strait of Hormuz.”
How are airlines being supported?
In terms of carriers the DfT said: “At some UK airports, airlines are given scheduled times known as ‘slots’ in which to take off or land.
“Under normal rules, airlines must use at least 80% of their allocated slots during a season to keep them for the following year. If they fall below this threshold, those slots can be reassigned to another airline. This is known as the ‘use it or lose it’ rule.
“Airport Coordination Limited, the independent body that manages slot allocation at UK airports, has updated its guidance so that airlines will not lose their slots if fuel shortages prevent them from flying. Airlines can now apply for an exemption from the ‘use it or lose it’ rule in these circumstances.
“This means airlines can focus on minimising disruption for passengers, rather than feeling pressure to operate flights purely to protect their slots.”
JET2 has issued an update to all travellers about increasing flight fares and holiday prices.
The UK’s biggest tour operator has confirmed that it will not be raising flights or holidays prices to cover increased costs caused by the fuel crisis.
Sign up for the Travel newsletter
Thank you!
Jet2 have issued an update about increasing flight and holiday pricesCredit: Alamy
The announcement comes as the ongoing fuel crisis has resulted in a number of airlines increasing their flight prices, including Virgin Atlantic.
The update applies to all flights and holidays with the provider, booked through any channel – whether that be online, via the app or via an independent travel agent.
It means that when passengers book with Jet2, the price that is shown for their holiday or flight, will be the price they pay.
Holidaymakers will still need to pay tourist taxes, which is usually done once you are on holiday at the resort or directly to your accommodation provider.
Steve Heapy, CEO of Jet2 said: “Holidaymakers should have every right to book their hard-earned break in the sun, without worrying about being hit with additional costs, and they can have that complete assurance when they book a flight or holiday with Jet2.
“As a result of today’s announcement, customers booking with Jet2 know that they are locking in their price without additional cost surprises later and we strongly believe that is the right thing to do by them.
“Ahead of a busy summer this is yet more evidence of why, on top of our incredible holidays and award-winning customer service, nothing beats a Jet2holiday.”
In a previous statement, a Jet2 spokesperson also told Sun Travel: “We remain in continual dialogue with our fuel suppliers, as is standard practice.
“Based on the conversations we have been having, we see no reason not to look forward to operating our scheduled programme of flights and holidays as normal.
“We understand that our customers work and save very hard for their holidays, and we are looking forward to making sure that they enjoy their award-winning Jet2holidays.”
The announcement comes as a number of other airlines have issued statements regarding upcoming flights and holidays.
TUI holidays confirmed that bookings have not been impacted or cancelled by the fuel crisis.
A TUI spokesperson told Sun Travel: “We’re closely monitoring the developing situation in the Middle East and its potential impact on global aviation fuel supplies.
“At present, we’re not anticipating disruption to our flight schedules or holiday programmes from fuel shortages.”
It comes as other airlines such as TUI have also commented on fuel crisis concernsCredit: Alamy
Budget airline easyJet has also said that flights are currently not impacted by the fuel crisis.
A spokesperson for the airline told Sun Travel that there was “no disruption to flights” and “no plans to make any changes to our flying schedule”.
However, earlier this week, easyJet’s CEO for Spain and Portugal did comment that it was “difficult to see” what would happen in the next few weeks.
Here’s a full rundown of what all the UK airlines have said about fuel crisis concerns.
Edward J. Rollins was White House political director from 1981-1985 and served as Ronald Reagan’s campaign manager in 1984
WASHINGTON — Polls show that record numbers of Americans think the country is on the wrong track. Anxious voters find no shortage of corroboration. Seeming proof of national decline is everywhere–the savings-and-loan bailout, an imperial Congress, overpaid executives at the top of underperforming companies, record murder rates in cities, declining school quality, an intractable drug epidemic, spiraling health-care costs and a flat economy riddled with deep pockets of regional recession. We haven’t felt good about ourselves, our country or our future since the Gulf War.
President George Bush’s decline in the polls mirrors this trend. As long as voters were concerned about foreign policy, his high standing compensated for lower ratings on domestic affairs. The Cold War’s end has changed the issue mix of presidential races forever.
The recession is an immediate problem, but that will decline in importance when the growth most economists predict resumes this spring. But the recession masks a deeper fear that our post-Cold War inheritance is a declining standard of living, with high-paying jobs and prosperity flowing overseas. That fear will not recede quickly.
With the recession ending by spring, campaign planners will be tempted to heave sighs of relief and run a status-quo candidacy against the uncertainties of a switch to the Democrats. That would be a serious mistake.
For Bush will never have more fertile ground to lay out a new GOP agenda that addresses the deep fear voters have about the future of America. He can capitalize on the public’s thirst for certainty by laying out a set of ambitious goals–in government, in jobs, in schools and in social progress.
He can start with government. A recent Gallup poll shows 20% blame Bush for the economy’s condition, but 54% blame Congress. Support for term limits and a Trumanesque campaign to fix what’s wrong with Congress will not only pay political dividends, but give him a governing coalition for a second term. Beginning with this week’s State of the Union, Bush should challenge Congress to pass his economic recovery program within 100 days and return it to him for signature. He should also push legislation on health-care reform, education and crime by similarly challenging Congress. To dramatize the push for excellence, he might consider national middle-class merit scholarships for college.
Nor should he give up on trade, despite the Japan trip. Presidential involvement in a few trade confrontations will make his claim to fight for American jobs more credible. Where unfair trading practices are found, executive action on import relief should be swift.
By establishing his vision for the post-Cold War future, contrasting his own activism with Democratic and congressional obstruction, showing that he thinks free trade should benefit us as well as our partners and fighting hard for the middle class–in essence charting a course the country thinks takes us in the right direction and gets us off the wrong track–he’ll win not only reelection but a mandate.
It’s also important to understand this is not the 1984 reelection. Compression of the primary calendar means there are fewer days between the first Iowa caucuses, Feb. 10, and Super Tuesday, March 10, and the Democratic winner-take-all rules could give a front-runner enough momentum to be the apparent nominee by April. There is little prospect for a protracted Democratic primary battle like 1984’s between Gary Hart and Walter F. Mondale.
Because the Democrats won’t be tearing each other apart as long, Bush should engage the Democrats early. But he needs to shore up his own vulnerabilities before he begins to contrast with the Democratic nominee. He needs to sharpen his middle-class message, starting with the economy and people’s fears about the future.
This should be done well before the summer Democratic convention, when the Democratic ticket will have a solid week of national television coverage to engage in Bush-bashing.
It’s also critical to understand this is not 1988. The Democratic nominee will also have learned a lesson from Michael S. Dukakis–define your candidacy before your opponent gets a chance to define it negatively for you. It’s highly unlikely the ’92 Democratic nominee will be kept on the defensive for months as was Dukakis.
This year’s presidential election takes place in politically uncharted territory. It is the first contest of the post-Cold War era, probably the last election with a World War II veteran running for President. World events, from Eastern Europe’s velvet revolutions of 1989 to last summer’s failed Soviet coup, have irrevocably reshaped America’s political landscape.
Foreign policy and defense no longer matter much to voters. Communism’s death also buried anti-communism as an issue. With few external threats, Americans see old relationships through a new prism. They supported the post-war alliance with Japan for mutual security; without the Cold War, that same relationship looks one-sided.
To win reelection, it’s critical to understand what this dramatic shift means. The old rules are gone–now is the time for a new political order in American campaigns. For four decades, we’ve elected presidents against a Cold War backdrop. Now that we’ve won the Cold War, we need a new presidential agenda that’s relevant for the ‘90s.
KERRY Katona has revealed she’s experiencing speech difficulties after she was rushed to hospital over stroke fears.
TheAtomic Kitten singer said she was with her partner Paolo Margaglione and her daughter Heidi who noticed that her mum’s face didn’t ‘appear right’.
Sign up for the Showbiz newsletter
Thank you!
Kerry Katona has shared a new health update after her recent hospital dashCredit: GettyThe TV personality said she’s suffering with aftereffects following the ordealCredit: Instagram / @kerryboutique.co.uk
Kerry, 45, was in London at the time of the incident, watching her eldest daughter Molly in a new play, when she fell unwell midway through the performance.
Although it was later ruled out as a stroke and most likely a result of stress, the mother-of-five said she’s still dealing with aftereffects.
Writing in her New column, she said: “I know I’m talking differently and I know my face looks different after my suspected stroke, but it’s actually loads better.
Kerry admitted that the terrifying ordeal had sent her anxiety through the roof.
She continued: “I’ve just got to try and not think about it, because I’m the worst hypochondriac in the world.
“It’s awful for my family, I think they’re all fed up and sick of me at this point.
“I have severe health anxiety, so when I start reading all the comments and I start learning all these new things that could be wrong, it makes me truly panic.”
Kerry opened up about the hospital dash earlier this month.
She told the Mirror: “I went to the toilet and noticed my face wasn’t right.
“And Heidi was like, ‘Mum, what’s wrong with your face?’ I started panicking. I discreetly left, went to my hotel and asked to see a doctor. I told the staff, ‘Something’s not right.’”
The mum-of-five was subsequently rushed to hospital in an ambulance.
“I got there, and they said, ‘We’re treating this as a stroke,’ so they blue-lit me in an ambulance from St Thomas’ to King’s College Hospital,” explains Kerry.
“They were shining lights in my eyes while my face and speech were getting worse.
“An hour ago I was watching our Molly in a play and now I’m being treated for a stroke. What the actual f**k? It just shows how quickly things can change.”
She said she felt ‘really scared’ and feared the worst but a stroke was later ruled out after a CT scan.
The Celebs Go Dating star revealed that her health scare was down to ‘delayed stress’ that can affect a person after they’ve ‘found peace’.
Following the incident, Kerry jetted off on holiday to Spain with her family to celebrate Dylan-Jorge’s 12th birthday but said she would see follow-up care when back in the country.
Kerry has Molly, 24, and Lilly-Sue, 23, with ex Brian McFadden; Heidi, 19, and Max, 17, with ex Mark Croft; and daughter Dylan-Jorge (known as DJ), 12, with late-husband George Kay.
Kerry exclusively told The Sun how things have been looking up for her ever since coupling up with new beau Paolo – 12 years her junior.
“Paolo is just a complete one-off,” she said.
“I’ve never met a human being like him. It actually makes me anxious, because I keep thinking it’s just too good to be true. I get emotional talking about him.
“I am so lucky I found him. I feel loved and wanted. I’ve never felt like that. I don’t think I’ve ever really truly been in proper love until I met Paolo. I don’t think I realised how starved I was of affection.
“I wasn’t even looking for a boyfriend or to get married again – I couldn’t think of anything worse. I wanted a pay cheque, exposure and a therapist [from the show]. Then I met him and thought, ‘You’re different.’”
Kerry said it was ruled out as a stroke but was likely the result of stressCredit: PA
OFFICIALS have warned that there is just weeks of jet fuel supplies left before airlines start running out.
Earlier this week, the head of the International Energy Agency warned that vital supplies remain blocked by conflict in Iran – as a result, many airlines have already started axing routes.
Sign up for the Travel newsletter
Thank you!
Certain airlines, like Norse, have started cutting back on flight routesCredit: GC ImagesBritish Airways has axed one route completely from April 24, 2026Credit: Getty
The blockade of the Strait of Hormuz is holding up major supply chains which has led to a huge hike in fuel costs – and shortages.
ACI Europe, which represents European airports, said the key trade route must open within three weeks or fuel reserves will run drastically low.
In response, a number of major airlines have been cancelling flights in preparation for shortages – with thousands affected.
Here are the major eight airlines that have already cut back on their routes…
With up to 5,000 flights a month – working out to around 4,000 domestic and 800 international routes – this means it affects around 250 flights a month.
United Airlineshas the world’s largest airline fleet with more than 1,075 aircraft.
Chief Executive of Air New Zealand Nikhil Ravishankar said the airline would see roughly a five per cent reduction in its services which would continue until the beginning of May 2026.
This reduction equates to around 1,100 flights which in turn will affect 44,000 passengers out of its 1.9million.
A spokesperson said: “Due to the continued increase in fuel constraint risks, fuel prices, and the resulting impact on our operating costs, we have had to make the difficult decision to suspend our LAX operations this summer, May to October.”
Norse operated a summer route from London Gatwick to LA.
BA said the terminating of the service was due to a shift in demand rather than fuel costs as hasn’t axed any flights because of that so far.
Virgin Airways
Virgin Atlantic announced earlier this month that it would be permanently scrapping its London flight to Riyadh from April 7, 2026.
It said some of the reasons were the “evolving situation in the Middle East” and “operating costs.”
Some airlines have increased prices to offset costs instead…
Rather than axing routes – other airlines have added surcharges or baggage fees…
Air France and KLM have have increased their round-trip fares by €100 (£87) on most of their long-haul flights– with an additional charge of €10 (£8.69) for a round trip in economy.
Virgin Atlantic confirmed it would do the same earlier this week – passengers in economy will pay an extra £50, in premium economy passengers will pay an extra £180 and anyone in business class will see flights cost an extra £360.
JetBlue has increased baggage fees by $4 (£3) for off peak, economy travellers. This will now be $39 (£30) – the cost peak economy travellers will be $49 (£37).
The low-cost Spanish Airline Volotea is adding maximum surcharge of €14 (£12.20) per person to flight bookings.
WASHINGTON — It was hard to miss President Trump’s very public spat with Pope Leo XIV this week.
The split was the first time in modern memory that an American president has so openly badmouthed a sitting pontiff, or, for that matter, distributed an image depicting himself as Jesus Christ. Critics cried “blasphemy!” even as supporters continued to stand behind the man whose presidency, some argue, was God sent.
Students of American history will recall an earlier incident that pitted papal and presidential authority against each other. The concern: that a president would align himself too closely to the church, or even take orders from the pope.
That anxiety seeped into the 1960 presidential campaign of John F. Kennedy, whose eventual victory would make him the first Catholic president.
Back then, Kennedy was constantly fending off accusations from Protestant ecclesiastic types who were wary that his nomination meant the pontiff, John XXIII, was already packing his bags for a move into the White House.
President John F. Kennedy meets with Pope Paul VI at the Vatican in July 1963, one month after Paul succeeded John XXIII as pontiff.
(Bettmann Archive / Getty Images)
The issue was so pronounced that 150 clergymen and laypeople formed Citizens for Religious Freedom, which in a pamphlet warned, “It is inconceivable to us that a Roman Catholic President would not be under extreme pressure by the hierarchy of his church to accede to its policies and demands.”
One particularly loud voice among the ministers was the Rev. Norman Vincent Peale, a popular and influential pastor and author. Peale was especially disturbed by Kennedy’s prospects.
“Our American culture is at stake,” he said at a meeting of the ministers. “I don’t say it won’t survive, but it won’t be what it was.”
The group asked Kennedy to “drop by Houston” to make clear his views on faith and government. He agreed, making a televised speech at the Rice Hotel, where he famously spelled out his firm opinions on the separation of church and state.
“I am not the Catholic candidate for president,” Kennedy told the group. “I am the Democratic Party’s nominee for president who happens to be Catholic.”
Time magazine reflected on the address some years later, concluding that the speech had gone so well for Kennedy “that many felt the dramatic moment was an important part of his victory.”
Since then, modern presidents have occasionally found themselves at odds with the Vatican. Typically Republican presidents would hear from the pope about foreign wars, while Democratic presidents were derided over abortion policies.
But such disagreements tended to be handled with the decorous language of diplomacy.
President George W. Bush presents Pope John Paul II with the Presidential Medal of Freedom in Rome on June 4 , 2004. The pope reminded Bush of the Vatican’s opposition to the war in Iraq. Bush praised him as a “devoted servant of God.”
(Eric Vandeville/Gamma-Rapho via Getty Images)
Then came Trump, who is now being accused of openly mocking the Catholic faith and the 1st Amendment. He called Leo weak on crime and foreign policy, among other things. A self-described nondenominational Christian who says his favorite book is the Bible, Trump’s hasn’t shied from bashing the pontiff, nor has he hesitated to blur the line separating church and state.
Where Kennedy argued for an absolute separation, Trump has advanced a model of religious resurgence, promising “pews will be fuller, younger and more faithful than they have been in years.” Through initiatives including the “America Prays” program launched last year, the White House has sought to bring “bring back God” by inviting millions of Americans to prayer sessions. The webpage for the program focuses features only Christian Scripture.
“From the earliest days of the republic, faith in God has been the ultimate source of the nation’s strength,” Trump said at a National Prayer Breakfast in February.
President Trump, then-Vice President Mike Pence and faith leaders say a prayer during the signing of a proclamation in the Oval Office on Sept. 1, 2017. .
(Alex Wong / Getty Images)
In the United States, the Catholic Church historically has “loved the 1st Amendment” and its guarantee of religious liberty and, as a result, largely kept some distance from government, according to Tom Reese, a Jesuit priest and religious commentator. After its failures attempting to influence monarchs and politicians in Europe, the Catholic Church “didn’t want the government interfering with them and knew that it wasn’t their right to interfere with the government,” Reese said.
Kennedy loved the 1st Amendment too. He put it above his own religious beliefs, and said as much on his way to the White House.
“I would not look with favor upon a president working to subvert the 1st Amendment’s guarantees of religious liberty,” he said. “Nor would our system of checks and balances permit him to do so.”
Pope Leo XIV meets with members of the community in Algiers at the Basilica of Our Lady of Africa on April 13, 2026.