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Trump threatens ‘much higher’ EU tariffs if deal not signed by July 4

May 8 (UPI) — President Donald Trump threatened to raise tariffs to “much higher levels” on the European Union if it doesn’t agree to a trade deal by July 4.

“I had a great call with The President of the European Commission, Ursula von der Leyen. We discussed many topics, including that we are completely united that Iran can never have a Nuclear Weapon. We agreed that a regime that kills its own people cannot control a bomb that can kill millions. I’ve been waiting patiently for the EU to fulfill their side of the Historic Trade Deal we agreed in Turnberry, Scotland, the largest Trade Deal, ever! A promise was made that the EU would deliver their side of the Deal and, as per Agreement, cut their Tariffs to ZERO! I agreed to give her until our Country’s 250th Birthday or, unfortunately, their Tariffs would immediately jump to much higher levels,” the president said Thursday afternoon on Truth Social.

The threat came after The EU has struggled to agree on the terms of the Turnberry Accord, which was for the United States to lower tariffs on EU products and for the EU to remove tariffs on U.S. industrial goods and invest billions in U.S. industries, including energy.

Von Der Leyen said on X that the bloc is still committed to the deal.

“I had a very good call with @POTUS. We discussed the situation in the Middle East and our close coordination with regional partners. We are united that Iran must never possess a nuclear weapon. Recent events have clearly shown that the risks to regional stability and global security are too great.

“We also discussed the EU-U.S. trade deal. We remain fully committed, on both sides, to its implementation. Good progress is being made towards tariff reduction by early July.”

Last week, Trump threatened to raise tariffs on European autos to 25%. It’s unclear if his renewed threat is specifically for vehicles or if it encompasses all EU exports.

Complicating matters is that Trump’s current method of levying tariffs was blocked Thursday by the U.S. Court of International Trade.

In February, the U.S. Supreme Court struck down the administration’s tariffs issued under the International Emergency Economic Powers Act of 1977. Trump then added a 10% across-the-board tariff and then later upped it to 15%.

U.S. Trade Representative Jamieson Greer said in an interview with Politico Thursday that the EU is moving slowly.

“With the tariffs, they’ve at least started a process. They’re working it through,” Greer said. “It’s a pain. I understand it’s slow. We’re not patient. But there are other things where they haven’t even started a process.”

“We’re 95% compliant for nine months … and they’ve been 0% compliant during that time. What am I supposed to do?” he said.

Speaker of the House Mike Johnson, R-La.,, speaks during an observance celebrating the 75th National Day of Prayer in Statuary Hall at the U.S. Capitol on Thursday. Photo by Bonnie Cash/UPI | License Photo

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Spirit Airlines shuts down, saying it can’t keep up with higher oil prices

Spirit Airlines, an impish upstart that shook the industry with its irreverent ads and deep discount fares, announced Saturday that it has gone out of business after 34 years.

The ultra-low-cost airline that once operated hundreds of daily flights on its bright yellow planes and employed about 17,000 people said it had “started an orderly wind-down of our operations, effective immediately.”

Although Spirit had gone bankrupt twice before, the company said high oil prices, which have been rising because of the U.S.-Israeli war with Iran, made it impossible to stay aloft.

The airline said on its website that all flights have been canceled and customer service is no longer available.

“We are proud of the impact of our ultra-low-cost model on the industry over the last 34 years and had hoped to serve our guests for many years to come,” the announcement said.

U.S. Transportation Secretary Sean Duffy said Saturday that Spirit had a reserve fund set up for customers who bought directly from the airline to get refunds. People who bought from third-party vendors such as travel agents would have to seek refunds from them. He had a stark message for people flying with Spirit.

“If you have a flight scheduled with Spirit Airlines, don’t show up at the airport. There will be no one here to assist you,” Duffy said.

He said United, Delta, JetBlue and Southwest were offering $200 one-way flights for people who could confirm that they had Spirit confirmation numbers and proof of purchase for a limited time. Duffy also said other airlines would help with Spirit employees who might be stranded and would offer them a preferential application process as they look for work.

Spirit said in a statement that it was working to get more than 1,300 crew members to their home bases and that the final Spirit flight landed early Saturday at Dallas Fort Worth International Airport from Detroit Metropolitan Airport.

The company advised customers that they could expect refunds but there would be no help in booking travel on other airlines.

The Trump administration had considered a government bailout for the cash-strapped business to keep it from going under, but a deal was not reached. Of the potential bailout, Duffy said Saturday that “we oftentimes don’t have half a billion dollars laying around.”

President Trump had floated the idea of a bailout last week after the airline found itself in bankruptcy proceedings for the second time in less than two years with jet fuel prices soaring since the start of the Iran war.

‘They get you there’

Five Spirit flights were still showing as “on time” on Saturday morning on the departure board in Atlanta. A trickle of passengers who hadn’t heard the news were still showing up.

“What!?” exclaimed Taylor Nantang as she, her husband and four children arrived for a Saturday afternoon Spirit flight from Atlanta to Miami for a spur-of-the-moment vacation. The family had driven down from Tennessee to the Atlanta airport.

“So the whole airline at every airport is out of business?” asked Nantang. “Oh my, that’s crazy.”

Other passengers wondered whether the airline would still answer its customer service phone, or when the refunds for canceled flights might arrive on their credit cards.

Joshua Sigler, who had bought a ticket Friday for a flight Saturday to Miami, said he would just return home after learning of the cancellation rather than try to take advantage of deals other airlines were offering to stranded Spirit passengers. He said he had gotten no communication from Spirit, which he had flown multiple times in the past.

“They get you there,” he said of his Spirit travels. “It was cheap.”

Waking to the news

Former Spirit flight attendant Freddy Peterson was on a Spirit flight from Detroit that arrived in Newark, N.J., around 11 p.m. Friday. He said that despite rumors flying on social media Friday, things seemed kind of normal, with more than 200 passengers on the plane.

“All our aircraft were packed,” he said.

Peterson, 60, said he set his alarm clock for 3 a.m. Saturday to check the company website at the hour of the rumored shutdown and learned all Spirit flights were canceled. He said Delta Air Lines brought him and another flight attendant back to Atlanta on Saturday morning, with Peterson leaving from there to drive to his home in Shellman in southwest Georgia.

“I’ll probably do my boo-hoo crying and all that other stuff once I get in the car.”

Peterson said he had been a flight attendant with Spirit for 10 years and the company has “done wonders for me.” He said the airline’s reputation for bargain-basement chaos was largely undeserved, but he did fault management for not communicating with the employees in the closing days, saying a promised employee town hall was canceled.

Bailout fizzles

As late as Friday afternoon, Trump had said his administration was looking at a bailout for Spirit and had given the budget carrier a “final proposal” for a taxpayer-funded takeover.

Spirit proudly disrupted the penny-pinching portion of the airline industry with its no-frills, low-cost flights and provocative ads like its “Check Out the Oil on Our Beaches” campaign after the Deepwater Horizon disaster in 2010, referencing suntan oil but alluding to the massive spill of crude along the Gulf Coast.

But Spirit has struggled financially since the COVID-19 pandemic, weighed down by rising operating costs and growing debt. By the time it filed for Chapter 11 protection in November 2024, Spirit had lost more than $2.5 billion since the start of 2020.

The budget carrier sought bankruptcy protection again in August 2025, when it reported having $8.1 billion in debts and $8.6 billion in assets, according to court filings.

White House blames Biden

The White House had blamed the Biden administration for Spirit’s tenuous financial situation, noting that President Biden opposed a proposed merger between Spirit and JetBlue in 2023. On Saturday, Trump administration officials took to social media to amplify voices of conservative critics who faulted that decision.

On Saturday, Duffy concentrated blame on Biden as well as Duffy’s predecessor, Pete Buttigieg. “Many at the time said that this was a disaster. This merger should have been allowed,” he said.

Tad DeHaven, a policy analyst at the Cato Institute, a libertarian think tank, said the Trump administration also bears responsibility, arguing that the airline’s latest crisis reflected a chain reaction of policy missteps rather than a single decision. He pointed specifically to Trump’s decision to strike Iran as “bad foreign policy,” noting the conflict drove up jet fuel prices and therefore Spirit’s operating costs.

“They were already in trouble,” DeHaven said, describing the situation as “a compounding effect in terms of policy.”

Supporters of a rescue including labor unions representing Spirit’s pilots, flight attendants and ramp workers said a collapse would put thousands of Americans out of work and hurt consumers by reducing airline competition and increasing airfares. About 17,000 jobs could be impacted, according to Spirit lawyer Marshall Huebner.

Budget-conscious and leisure travelers are likely to feel Spirit’s absence the most, especially in places where the airline has a big footprint such as Las Vegas and the Florida cities of Fort Lauderdale and Orlando.

The carrier flew about 1.7 million domestic passengers in February, roughly half a million fewer than during the same month a year earlier, according to aviation analytics firm Cirium. Spirit also has sharply reduced its capacity; about half as many seats had been available this month as in May 2024.

Madhani, Yamat, Amy and Catalini write for the Associated Press and reported from West Palm Beach, Las Vegas, Atlanta and Morrisville, Pa., respectively. AP writer Josh Funk in Omaha contributed to this report.

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European markets set to open higher despite US-Iran negotiations stalling

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Germany’s Dax, France’s CAC 40, Italy’s FTSE MIB and the UK’s FTSE 100 are expected to open in the green, according to IG data, despite peace talks between the US and Iran coming to a halt.


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The White House called off plans to send envoys to Pakistan for more negotiations and US President Donald Trump cited a lack of progress over the weekend.

“If they want, we can talk but we’re not sending people,” Trump told Fox News on Sunday. He said earlier on social media: “All they have to do is call!!!”

In addition to monitoring progress in the Middle East, investors will also be keeping across central bank decisions this week, including from the ECB and Federal Reserve.

Asia-Pacific markets mixed

Meanwhile, markets were mixed overnight in the Asia-Pacific region. Tokyo’s Nikkei 225 index hit a fresh record, surging 1.4% to 60,564.18. The Kospi in South Korea jumped 2.1% to 6,617.94. Hong Kong’s Hang Seng index edged 0.1% lower to 25,951.86 and the Shanghai Composite index was up 0.2% at 4,089.04. Australia’s S&P/ASX 200 slipped 0.3% to 8,759.40.

Taiwan’s Taiex rallied 2.6%, helped by a revival of buying of tech shares driven by the boom in artificial intelligence.

Oil prices rise again

In other dealings early Monday, the price for a barrel of Brent crude to be delivered in July, rose $1.44 to $100.57, while US benchmark crude oil added $1.28 to $95.65.

The dollar fell to 159.34 Japanese yen from 159.59. The euro climbed to $1.1723 from $1.1701.

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UK inflation hits 3.3% as Iran war drives energy costs higher

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The cost of living in the UK accelerated throughout March, propelled by a significant increase in petrol and diesel prices following the outbreak of the Iran war.


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According to the Office for National Statistics, the annual consumer price inflation rate moved to 3.3% from 3% the previous month, a shift that matched the forecasts.

This inflationary pressure is largely attributed to an 8.7% monthly jump in motor fuel costs, which represents the sharpest rise seen since the summer of 2022, following Russia’s full-scale invasion of Ukraine.

Beyond the petrol stations, the fallout from higher energy prices has trickled down into airfares and food supplies, complicating the economic landscape for the government and the Bank of England.

UK Treasury chief Rachel Reeves noted that while the conflict is not a domestic one, it is directly pushing up bills for families and businesses across Britain.

Lindsay James, an investment strategist at Quilter, observed that “this morning’s inflation data showed CPI creeping back up to 3.3%, confirming that price pressures are re-accelerating rather than fading away since the outbreak of the war in Iran.”

While international markets have shown some signs of recovery in equity prices, the physical market for oil delivery into Europe remains under immense strain.

Experts suggest that a swift reopening of the Strait of Hormuz is the only viable path to unwinding the current inflationary trend, yet the situation remains volatile and unpredictable.

The Bank of England’s policy dilemma

The timing of this inflation surge is particularly problematic because it coincides with a period of cooling in the domestic economy.

Recent data from the labour market indicates that payrolled employment is falling and economic inactivity is on the rise, while wage growth has started to ease.

For the average British worker, the combination of rising essential costs and stagnating earnings growth creates a challenging environment for real purchasing power.

As for the Bank of England, this sudden spike in prices has disrupted the projected path of beginning to lower borrowing costs this spring.

Prior to the escalation of the Iran war, there was a growing consensus that the central bank would reduce its main interest rate from 3.75% as inflation appeared to be heading back toward the official 2% target.

However, with inflation now expected to potentially hit 4% in the coming months, the Monetary Policy Committee faces a much more difficult decision during its meeting next week.

There is a growing debate among economists regarding whether traditional interest rate hikes are the correct tool to address this specific crisis.

According to James “a rise in rates risks misdiagnosing the problem. This inflationary pulse is being driven by supply disruption, not excess demand. Higher interest rates will do nothing to increase the flow of oil or other goods from the Middle East.”

This sentiment suggests that the Bank of England may choose to maintain its current stance, keeping rates on hold while monitoring whether these price increases begin to manifest in higher wage demands across the broader economy.

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March retail sales jump on higher gas prices, Commerce Department says

April 21 (UPI) — Retail sales rose by 1.7% in March mostly due to high gas prices from the ongoing conflict with Iran, the Commerce Department announced Tuesday.

It was the fastest monthly change in three years, according to a release.

In February, sales rose 0.7%.

Retail sales are seasonally adjusted but not for inflation. In March inflation rose by 0.9%, which was three times the February rate, according to the latest Consumer Price Index.

The war between the United States, Israel and Iran has caused gas prices to spike. The Strait of Hormuz, a critical transportation route for oil, has been closed to most traffic throughout the fighting. It has dramatically affected the price of gas in the United States and abroad.

Gas station sales jumped in March by 15.5% from February. Without gas station sales, retail rose 0.6% in March, which was at 0.7% in February.

Some categories were stronger. Furniture and home furnishing sales were up 2.2% in March.

Electronics and building materials held up well, too.

Gary Schlossberg, global strategist at Wells Fargo Investment Institute, said in commentary to investors on Tuesday: “Pressure on household budgets is being cushioned, for now, by sizable increases in tax refunds tied to last year’s legislation.”

Consumers adjusted their spending in other areas. Apparel sales were flat, and restaurant sales rose only 0.1%.

Gas prices likely caused that, said Dan North, Allianz Trade senior economist for North America.

“Gasoline is a thing you love to hate, because you have to buy it; there’s really no substitute,” North told CNN in an interview.

Eventually, consumers will deplete savings and tax refunds, and for lower-income Americans, it could be a struggle, North said.

“If we can wind this up, so to speak, in the next few months, the damage to the consumer and economy might not be so bad,” North said. “If you start stretching it out for months and months and toward the end of the year, then consumers and the rest of the economy get in trouble.”

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