Trade War

United States President Donald Trump has imposed tariffs on European goods, made a bid to take over Greenland and demanded Europe foot the bill for its own defence. European leaders now fear the era of US-led security protections may be over. They’re accelerating efforts to reduce their military and economic dependence on the US.

At the Munich Security Conference, US Secretary of State Marco Rubio insisted his nation is not walking away from its allies. But few in the room were convinced. Instead, leader after leader took to the podium with the same message: Europe must stand on its own.

United States Treasury Secretary Scott Bessent has claimed that Washington engineered a dollar shortage in Iran to send the rial into freefall and cause protests on the streets.

In December and January, Iran was faced with one of the biggest antigovernment protests the country has seen since the Islamic revolution of 1979, prompted by the severe economic crisis.

Protests over soaring prices in Iran began with shopkeepers in Tehran who shuttered their shops and began demonstrating on December 28, 2025, after the rial plunged to a record low against the US dollar in late December. The protests then spread to other provinces of Iran.

Supreme Leader Ayatollah Ali Khamenei’s government responded with force. More than 6,800 protesters, including at least 150 children, are thought to have been killed in a sweeping crackdown by the government on the protest movement.

So, how did Washington create a “dollar shortage” in Iran, ultimately causing the rial to tank? And what effect has that had on the Iranian people?

What is a ‘dollar shortage’?

A “dollar shortage” refers to when a country does not have enough US dollars to pay for things it needs from the rest of the world.

The US dollar is the main currency used in global trade, especially for oil, machinery and loan repayments, which means countries need a steady supply of it.

If exports fall and sanctions block access to the US financial system, dollars can become scarce. As a result, the local currency weakens, prices of imported goods rise, and inflation worsens.

In Iran, a “dollar shortage” was engineered by simultaneously blocking the two main channels of foreign exchange (FX) inflow: Oil exports and international banking access, said Mohammad Reza Farzanegan, an economist at Germany’s Marburg University. The US did this by imposing sanctions on Iranian oil, meaning anyone buying or selling it would be subject to punitive measures.

Given Iran’s dependence on oil for revenue, economic sanctions on its oil can create a severe FX constraint.

“By using secondary sanctions to threaten any global entity trading in dollars with Iran, the US traps Iran’s existing reserves abroad and prevents new dollars from entering the domestic market,” Farzanegan told Al Jazeera.

What has US Treasury Secretary Scott Bessent said?

Replying to a query about dealing with Iran at a Congressional hearing last week, Treasury Secretary Bessent described the US strategy to send the Iranian currency plunging.

“What we [have done] at Treasury is created a dollar shortage in the country,” Bessent said, adding that the strategy came to a “grand culmination in December, when one of the largest banks in Iran went under … the Iranian currency went into freefall, inflation exploded, and hence, we have seen the Iranian people out on the street.

“We have seen the Iranian leadership wiring money out of the country like crazy,” Bessent added. “So the rats are leaving the ship, and that is a good sign that they know the end may be near.”

Before this, speaking with Fox News at the World Economic Forum last month in Davos, Bessent explained the role US sanctions played in driving the recent nationwide protests.

“President Trump ordered Treasury … to put maximum pressure on Iran, and it’s worked,” he said. “Because in December, their economy collapsed. They are not able to get imports, and this is why the people took to the streets.”

In both instances, Bessent referred to his earlier remarks at the Economic Club of New York, in March last year, when he outlined how the White House would leverage President Donald Trump’s “maximum pressure” campaign to collapse Iran’s economy.

In his address there, Bessent said the US “elevated a sanctions campaign against [Iran’s] export infrastructure, targeting all stages of Iran’s oil supply chain”, coupled with “vigorous government engagement and private sector outreach” to “close off Iran’s access to the international financial system”.

What effect did the dollar shortage have in Iran?

In January, the Iranian rial was trading at 1.5 million to the dollar – a sharp decline from about 700,000 a year earlier in January 2025 and about 900,000 in mid-2025. The plummeting currency triggered steep inflation, with food prices an average of 72 percent higher than last year.

In 2018, during his first presidency, Trump withdrew from the 2015 Joint Comprehensive Plan of Action, a deal between Iran and global powers limiting Tehran’s nuclear programme in return for sanctions relief.

Since re-election last January, President Trump has doubled down on his so-called “maximum pressure” to cripple Iran’s economy and corner Tehran to renegotiate its nuclear and regional policies. Last month, Trump threatened a 25 percent tariff on countries doing business with Iran.

Through the rigorous blocking of Iran from the global financial system by creating a dollar shortage, the US pushed Tehran towards a severe “import compression, [and as a result, Iran] cannot pay for the intermediate goods and machinery required for domestic production”, said Farzanegan, the economist.

The US strategy, he said, “is particularly devastating because it leverages commercial risk management against humanitarian needs”. In short, Washington’s strategy “makes the small Iranian market a commercial liability” for any company, even if they are only dealing with medicine, for instance, Farzanegan added.

A research paper published by Farzanegan and Iranian American economist Nader Habibi last year found that the size of Iran’s middle class would have expanded by an annual average of approximately 17 percentage points, between 2012 and 2019, if it were not for US action.

In 2019, the estimated size of loss in the middle-class share of the population in Iran was 28 percentage points, the research found.

“People lost their purchasing power, and savings were wiped out,” the economist told Al Jazeera. “This is a long-term destruction of the country’s human capital.”

Besides the US action is the existing vulnerability of Iran’s economic structure, with factors like long-term mismanagement, high rates of corruption and over-reliance on oil revenues making it fragile.

While the US sanctions created external shock, a lack of domestic structural reforms left the government with “no fiscal space to cushion the blow”.

What is the US’s endgame here – and will it succeed?

Bessent’s admission that Washington deliberately created a “dollar shortage” signals the US’s shift towards a total economic warfare narrative.

“This is economic statecraft; no shots fired,” Bessent said at the WEF in Davos last month.

“This admission may complicate the US’s diplomatic standing, as it confirms that the humanitarian channels for food and medicine are often rendered useless if the entire banking system is being targeted for collapse,” Farzanegan said.

Bruce Fein, a former US associate deputy attorney general who specialises in constitutional and international law, told Al Jazeera that this type of economic coercion is “as common as the sun rising in the east and setting in the west”, pointing to economic sanctions against Russia, Cuba, North Korea, China and Myanmar.

However, unlike in other cases where the US has applied economic pressure, Farzanegan said Iran’s case is “a unique experiment due to the duration and intensity of the pressure”.

Unlike Russia, which has a more diversified export base and larger reserves, Iran has been facing varied forms of sanctions for decades since the supreme leader took power in 1979.

“Iran has a sophisticated internal mechanism for sanctions circumvention that makes the ‘dollar shortage’ a game of cat-and-mouse rather than a one-time shock,” the economist said.

With a US armada currently stationed in the Arabian Sea, the US and Iran are in talks to defuse tensions. The US wants three key things from Iran: To stop enriching uranium as part of its nuclear programme, to get rid of its ballistic missiles and to stop arming non-state actors in the region.

Ultimately, observers say, the US wants regime change in Iran.

But Fein said his experience shows that economic sanctions alone “seldom, if ever, topple regimes … Regime change comes externally only with the use of military force.

“Iran’s dollar shortage will not oust the mullahs or Revolutionary Guard,” he said, referring to Iran’s current administrative structure.

The impoverishment of Iranians will diminish, Fein told Al Jazeera, “rather than promote the likelihood of a successful revolution because day-to-day survival will be the priority”.

The nonpartisan Congressional Budget Office’s 10-year outlook projects worsening long-term United States federal deficits and rising debt, driven largely by increased spending, notably on Social Security, Medicare, and debt service payments.

Compared with the CBO’s analysis this time last year, the fiscal outlook, which was released on Wednesday, has deteriorated modestly.

The CBO said that the deficit for fiscal 2026 – President Donald Trump’s first full fiscal year in office – will be about 5.8 percent of GDP, about where it was in fiscal 2025, when the deficit was $1.775 trillion.

But the US deficit-to-GDP ratio will average 6.1 percent over the next decade, reaching 6.7 percent in fiscal 2036 – far above US Treasury Secretary Scott Bessent’s goal to shrink it to about 3 percent of economic output.

Major developments over the last year are factored into the latest report, including Republicans’ tax and spending measure known as the “One Big Beautiful Bill Act,” higher tariffs, and the Trump administration’s crackdown on immigration, which includes deporting millions of immigrants from the US mainland.

As a result of these changes, the projected 2026 deficit is about $100bn higher, and total deficits from 2026 to 2035 are $1.4 trillion larger, while debt held by the public is projected to rise from 101 percent of GDP to 120 percent — exceeding historical highs.

Notably, the CBO says higher tariffs partially offset some of those increases by raising federal revenue by $3 trillion, but that also comes with higher inflation from 2026 to 2029.

Rising debt and debt service are important because repaying investors for borrowed money crowds out government spending on basic needs such as roads, infrastructure and education, which enable investments in future economic growth.

CBO projections also indicate that inflation does not hit the Federal Reserve’s 2 percent target rate until 2030.

A major difference is that the CBO forecasts rely on significantly lower economic growth projections than the Trump administration, pegging 2026 real GDP growth at 2.2 percent on a fourth-quarter comparison basis, fading to an average of about 1.8 percent for the rest of the decade.

Trump administration officials in recent weeks have projected robust growth in the 3-4 percent range for 2026, with recent predictions that first-quarter growth could top 6 percent amid rising investments in factories and artificial intelligence data centres.

CBO’s forecasts assume that tax and spending laws and tariff policies in early December remain in place for a decade. The government’s fiscal year starts on October 1.

While revived investment tax incentives and bigger individual tax refunds provide a boost in 2026, the CBO said that this is attenuated by the drag from larger fiscal deficits and reduced immigration that slows the growth of the labour force.

Jonathan Burks, executive vice president of economic and health policy at the Bipartisan Policy Center said “large deficits are unprecedented for a growing, peacetime economy”, though “the good news is there is still time for policymakers to correct course.”

‘Urgent warning’

Lawmakers have recently addressed rising federal debt and deficits primarily through targeted spending caps and debt limit suspensions, as well as deploying “extraordinary measures” when the US is close to hitting its statutory spending limit, though these measures have often been accompanied by new, large-scale spending or tax policies that maintain high deficit levels.

And Trump, at the start of his second term, deployed a new “Department of Government Efficiency”, which set a goal to balance the budget by cutting $2 trillion in waste, fraud and abuse; however, budget analysts estimate that DOGE cut anywhere between $1.4bn to $7bn, largely through workforce firings.

Michael Peterson, CEO of the Peterson Foundation, said the CBO’s latest budget projection “is an urgent warning to our leaders about America’s costly fiscal path.”

“This election year, voters understand the connection between rising debt and their personal economic condition. And the financial markets are watching. Stabilising our debt is an essential part of improving affordability, and must be a core component of the 2026 campaign conversation.”

A US oil blockade is causing a severe energy crisis in Cuba, as the government has been forced to ration fuel and cut electricity for many hours a day, paralysing life in the communist-ruled island nation of 11 million.

Bus stops are empty, and families are turning to wood and coal for cooking, living through near-constant power outages amid an economic crisis worsened by the Trump administration’s steps in recent weeks.

President Miguel Diaz-Canel has imposed harsh emergency restrictions – from reduced office hours to fuel sales – in the backdrop of looming threats of regime change from the White House.

The Caribbean region has been on edge since the US forces abducted Venezuela’s President Nicolas Maduro last month and upped the pressure to isolate Havana and strangle its economy. Venezuela, Cuba’s closest ally in the region, provided the country with the much-needed fuel.

So, how dire is the situation in Cuba? What does United States President Donald Trump want from Havana? And how long can Cuba sustain?

What are Cuba’s emergency measures?

Blaming the US for the crisis, Cuba’s Deputy Prime Minister Oscar Perez‑Oliva Fraga appeared on state television on Friday to inform the millions of the emergency steps “to preserve the country’s essential functions and basic services while managing limited fuel resources”.

Now, the Cuban state companies will shift to a four‑day workweek, with transport between provinces dialled down, main tourism facilities closed, shorter schooldays and reduced in‑person attendance requirements at universities.

“Fuel will be used to protect essential services for the population and indispensable economic activities,” said Perez-Oliva. “This is an opportunity and a challenge that we have no doubt we will overcome. We are not going to collapse.”

The government says it will prioritise available fuel for essential services – public health, food production and defence – and push the installation of solar-based renewable energy sector and incentives therein. It will prioritise shifting energy to selected food production regions and accelerate the use of renewable energy sources, while cutting down on culture and sport activities and diverting resources towards the country’s early warning systems.

Why has the US blocked oil to Cuba?

Decades of strict US economic sanctions against Cuba, the largest island nation in the Caribbean, have destroyed its economy and isolated it from international trade. Cuba relied on foreign allies for oil shipments, such as Mexico, Russia, and Venezuela.

However, after the US forces abducted Venezuelan President Maduro, Washington blocked any Venezuelan oil from going to Cuba. Trump now says the Cuban government is ready to fall.

Under Trump, Washington has pivoted to the Western Hemisphere, which it wants to dominate. The military actions in Venezuela, the pledge to take over Greenland and changing the government in Cuba are part of the new policy.

Last month, Trump signed an executive order – labelling Cuba a threat to national security – imposing tariffs on any country that sells or provides oil to the island nation. Further pressure on the Mexican government reportedly led to oil stocks reaching a record low in Cuba.

“It looks like it’s something that’s just not going to be able to survive,” Trump told reporters last month, when questioned about the Cuban economy. “It is a failed nation.”

Havana has rejected accusations that it poses a threat to US security. Last week, the Cuban Ministry of Foreign Affairs issued a statement calling for dialogue.

“The Cuban people and the American people benefit from constructive engagement, lawful cooperation, and peaceful coexistence. Cuba reaffirms its willingness to maintain a respectful and reciprocal dialogue, oriented toward tangible results, with the United States government, based on mutual interest and international law,” a statement from the ministry said on February 2.

Trump’s goals in Cuba remain unclear; however, US officials have noted on multiple occasions that they would like to see the government change.

Responding to a question during a US Senate hearing on Venezuela, Secretary of State Marco Rubio said, “We would like to see the regime there change. That doesn’t mean that we’re going to make a change, but we would love to see a change.”

Rubio, who is of Cuban descent, is one of the most powerful figures in Trump’s administration.

“The Cuban-American lobby, which Rubio represents, is one of the most powerful foreign policy lobbies in the United States today,” Ed Augustin, an independent journalist in Havana, told Al Jazeera’s The Take.

“In the new Trump administration, [with] an unprecedented number of Cuban Americans, the lobbyists have become the policymakers,” he said, adding that Rubio has built firm control over the lobby.

On January 31, Trump told reporters, “It doesn’t have to be a humanitarian crisis. I think they probably would come to us and want to make a deal. So Cuba would be free again.”

He said Washington would make a deal with Cuba, but offered no clarity on what that means.

History of US-Cuba relations

Since Fidel Castro overthrew the pro-US regime in the Cuban revolution in 1959, the country has been under US embargo. Decades of sanctions have denied Cuba access to global markets, making even supply medicines difficult.

Castro nationalised US-owned properties, mainly the oil sector, and Washington responded with trade restrictions that soon became a full economic embargo that continues to this day, undermining Cuba’s economy.

The US also cut diplomatic ties with Havana, and three years later, a missile crisis almost brought Washington and the erstwhile USSR, an ally of Cuba, to the brink of nuclear war.

In 2014, Washington and Havana restored ties after 50 years. Two years later, US President Barack Obama travelled to Havana to meet Raul Castro.

However, during his first term as president, Trump reversed the historic move in 2017. Since then, the US has reimposed a raft of sanctions against Cuba, especially economic restrictions, leading to one of the worst economic crises in the island nation’s history. Within hours of his inauguration in January 2025, Trump reversed the previous administration’s policy of engagement with Havana.

How long can Cuba sustain?

Until last month, Mexico reportedly remained Cuba’s major oil supplier, sending nearly 44 percent of total oil imports, followed by Venezuela at 33 percent, while nearly 10 percent was sourced from Russia and a smaller amount from Algeria.

According to Kpler, a data company, by January 30, Cuba was left with oil enough to last only 15 to 20 days at current levels of demand.

Cuba currently needs an estimated 100,000 barrels of crude oil per day.

What has the UN said about the Cuban crisis?

United Nations spokesperson Stephane Dujarric told reporters on Wednesday that “the secretary-general is extremely concerned about the humanitarian situation in Cuba, which will worsen, and if not collapse, if its oil needs go unmet”.

Dujarric said, for more than three decades, the UN General Assembly has consistently called for an end to the embargo imposed by the US on Cuba, adding that the UN urges “all parties to pursue dialogue and respect for international law”.

Francisco Pichon, the senior-most UN official in Cuba, described “a combination of emotions” in the country – “a mix of resilience, but also grief, sorrow and indignation, and some concern about the regional developments”.

The UN team in Havana says the vast majority of Cubans are hit by rolling blackouts, with the number of people in vulnerable situations increasing significantly.

“The last two years have been quite tough,” Pichon said, adding that urgent changes are needed to sustain Cuba “in the midst of the severe economic, financial and trade sanctions”.

New Delhi, India – When US President Donald Trump announced a trade deal with India on Monday this week, he declared that New Delhi would pivot away from Russian energy as part of the agreement.

Indian Prime Minister Narendra Modi, Trump said, had promised to stop buying Russian oil, and instead buy crude from the United States and from Venezuela, whose president, Nicolas Maduro, was abducted by US special forces in early January. Since then, the US has effectively taken control of Venezuela’s mammoth oil industry.

In return, Trump dialled down trade tariffs on Indian goods from an overall 50 percent to just 18 percent. Half of that 50 percent tariff was levied last year as punishment for India buying Russian oil, which the White House maintains is financing Russian President Vladimir Putin’s war in Ukraine.

But since Monday, India has not publicly confirmed that it has committed to either ceasing its purchase of Russian oil or embracing Venezuelan crude, analysts note. Dmitry Peskov, a Kremlin spokesperson, told reporters on Tuesday that Russia had received no indication of this from India, either.

And switching from Russian to Venezuelan oil will be far from straightforward. A cocktail of other factors – shocks to the energy market, costs, geography, and the characteristics of different kinds of oil – will complicate New Delhi’s decisions about its sourcing of oil, they say.

So, can India really dump Russian oil? And can Venezuelan crude replace it?

What is Trump’s plan?

Trump has been pressuring India to stop buying Russian oil for months. After Russia invaded Ukraine in 2022, the US and European Union placed an oil price cap on Russian crude in a bid to limit Russia’s ability to finance the war.

As a result, other countries including India began buying large quantities of cheap Russian oil. India, which before the war sourced only 2.5 percent of its oil from Russia, became the second-largest consumer of Russian oil after China. It currently sources around 30 percent of its oil from Russia.

Last year, Trump doubled trade tariffs on Indian goods from 25 percent to 50 percent as punishment for this. Later in the year, Trump also imposed sanctions on Russia’s two biggest oil companies – and threatened secondary sanctions against countries and entities that trade with these firms.

Since the abduction of Maduro by US forces in early January, Trump has effectively taken over the Venezuelan oil sector, controlling sales cash flows.

Venezuela also has the largest proven oil reserves in the world, estimated at 303 billion barrels, more than five times larger than those of the US, the world’s largest oil producer.

But while getting India to buy Venezuelan oil makes sense from the US’s perspective, analysts say this could be operationally messy.

How much oil does India import from Russia?

India currently imports nearly 1.1 million barrels per day (bpd) of Russian crude, according to analytics company Kpler. Under Trump’s mounting pressure, that is lower than the average 1.21 million bpd in December 2025 and more than 2 million bpd in mid-2025.

One barrel is equivalent to 159 litres (42 gallons) of crude oil. Once refined, a barrel typically produces about 73 litres (19 gallons) of petrol for a car. Oil is also refined to produce a wide variety of products, from jet fuel to household items including plastics and even lotions.

Has India stopped Russian oil purchases?

India has reduced the amount of oil it buys from Russia over the past year, but it has not stopped buying it altogether.

Under increasing pressure from Trump, last August, Indian officials called out the “hypocrisy” of the US and EU pressuring New Delhi to back off from Russian crude.

“In fact, India began importing from Russia because traditional supplies were diverted to Europe after the outbreak of the conflict,” Randhir Jaiswal, India’s Foreign Ministry spokesperson, said then. He added that India’s decision to import Russian oil was “meant to ensure predictable and affordable energy costs to the Indian consumer”.

Despite this, Indian refiners, currently the second-largest group of buyers of Russian oil after China, are reportedly winding up their purchases after clearing current scheduled orders.

Major refiners like Hindustan Petroleum Corporation Ltd (HPCL), Mangalore Refinery and Petrochemicals Ltd (MRPL), and HPCL-Mittal Energy Ltd (HMEL) halted purchasing from Russia following the US sanctions against Russian oil producers last year.

Other players like Indian Oil Corporation (IOC), Bharat Petroleum Corporation, and Reliance Industries will soon stop their purchases.

What happens if India suddenly stops buying Russian oil?

Even if India wanted to stop importing Russian oil altogether, analysts argue it would be extremely costly to do so.

In September last year, India’s oil and petroleum minister, Hardeep Singh Puri, told reporters that it would also sharply push up energy prices and fuel inflation. “The world will face serious consequences if the supplies are disrupted. The world can’t afford to keep Russia off the oil market,” Puri said.

Analysts tend to agree. “A complete cessation of Indian purchases of Russian oil would be a major disruption. An immediate halt would spike global prices and threaten India’s economic growth,” said George Voloshin, an independent energy analyst based in Paris.

Russian oil would likely be diverted more heavily towards China and into “shadow” fleets of tankers that deliver sanctioned oil secretly by flying false flags and switching off location equipment, Voloshin told Al Jazeera. “Mainstream tanker demand would shift toward the Atlantic Basin, most likely increasing global freight rates as a result,” he noted.

Sumit Pokharna, vice president at Kotak Securities, noted that Indian refineries have reported robust margins in the last two years, majorly benefitting from the discounted Russian crude.

“If they move to higher-costing, like the US or Venezuela, then raw material cost would increase, and that would squeeze their margins,” he told Al Jazeera. “If it goes beyond control, they may have to pass the excess onto consumers.”

Can India stop buying Russian oil altogether?

It may not be able to. One of India’s two private refiners, Nayara Energy, is majority-Russian-owned and under heavy Western sanctions. The Russian energy firm Rosneft holds a 49.13 percent stake in the company, which operates a 400,000-barrel-per-day refinery in India’s Gujarat, PM Modi’s home state.

Nayara is the second-largest importer of Russian crude, buying about 471,000 barrels per day in January this year, accounting for nearly 40 percent of Russian supplies to India.

Its plant has relied solely on Russian crude since European Union sanctions were imposed on the company last July.

Nayara is not planning to load Russian oil in April as it shuts its refinery for more than a month for maintenance from April 10, according to Reuters.

Pokharna said the future of Nayara hangs in the balance, with the US unlikely to grant India an overt exemption for the Russia-backed company to import crude.

Can India switch to Venezuelan oil?

India has been a major consumer of Venezuelan oil in the past. At its peak, in 2019, India imported $7.2bn of oil, accounting for just under 7 percent of total imports. That stopped after the US slapped sanctions on Venezuelan oil, but some officials of the government-owned Oil and Natural Gas Corporation are still stationed in the Latin American country.

Now, major Indian refiners have said they are open to receiving Venezuelan oil again, but only if it is a viable option.

For one thing, Venezuela is roughly twice as far from India as Russia and five times further than the Middle East, meaning much higher freight costs.

Venezuelan oil is more expensive as well. “Russian Urals [a medium-heavy crude blend] has been trading at a wide-ranging discount of about $10-20 per barrel to Brent, while Venezuelan Merey currently offers a smaller discount of around $5-8 per barrel,” Voloshin told Al Jazeera.

“Importing from Venezuela and forgoing the Russian discount would be a costly affair for India,” said Pokharna. “From transportation cost to forgoing discounts, it could cost India $6-8 more per barrel – and that is a huge increase in the importing bill.”

Overall, a complete pivot away from Russia could raise India’s import bill by $9bn to $11bn – an amount roughly equal to India’s federal health budget – per year, according to Kpler.

“Venezuelan crude must be discounted by at least $10 to $12 per barrel to be competitive,” argued Voloshin. “This deeper discount is necessary to offset the much higher freight costs, increased insurance premiums for the longer Atlantic voyage, and the somewhat higher operational expenses required to process Venezuela’s extra-heavy high-sulfur crude.”

Without deeper discounts, the longer journey and complex handling make Venezuelan oil more expensive on a delivered basis, he added.

Another major issue is that many Indian refiners simply do not have the facilities to process very heavy Venezuelan oil.

Venezuelan crude is a heavy, sour oil, thick and viscous like molasses, with a high sulphur content requiring complex, specialised refineries to process it into fuel. Only a small number of Indian refineries are equipped to handle it.

“[Venezuelan oil’s heaviness] makes it an option only for complex refineries, leaving out older and smaller refineries,” Pokharna told Al Jazeera. “The shift is operationally difficult and would require blending with more expensive light crudes.”

Then there is the question of availability. Today, Venezuela produces barely a million barrels per day when pushed to its limit. Even if all production was sent to India, it would not match the total Russian oil import.

Where else could India buy oil?

India’s Minister Puri has said that New Delhi is looking to diversify sourcing options from nearly 40 countries.

As India has reduced Russian imports, it has increased them from Middle Eastern nations and other countries in the Organization of the Petroleum Exporting Countries (OPEC). Now, while Russia accounts for nearly 27 percent share in India’s oil imports, OPEC nations, led by Iraq and Saudi Arabia, contribute 53 percent.

Reeling from Trump’s trade war, India has also increased purchases of US oil. American crude imports to India rose by 92 percent from April to November in 2025 to nearly 13 million tons, compared to 7.1 million in the same period in 2024.

However, India would be competing for these supplies with the European Union, which has pledged to spend $750bn by 2028 on US energy and nuclear products.

Meanwhile, for Venezuela to return to higher production, Caracas needs political stability, changes in foreign investment and oil laws, and to clear debts. That will take time, experts say.

Walmart has reached a $1 trillion market valuation, a first for the big-box retailer.

The company’s shares hit a high on Tuesday morning trade as the stock continues to soar on the news of a new CEO and looming trade negotiations with India, where the Arkansas-based company maintains a large presence both in supply chain and domestic markets within India. The stock was up 2.1 percent from the market open in midday trading.

Walmart, which has 11,000 stores in 19 countries, joins a slate of nine corporate giants in the so-called trillion dollar club, including Nvidia, Apple, Alphabet, and Microsoft, among others. Amazon is the only other retailer that has broken the barrier and is now valued at $2.6 trillion.

Trade deal bump

On Monday, United States President Donald Trump announced a trade deal with India that would slash tariffs to 18 percent from 50 percent and that impacts Walmart, which has strategically shifted supply chain operations to India and away from China.

On Tuesday, in an interview with CNBC, US Trade Representative Jamieson Greer said that the White House is still ironing out the details of the deal, but that still hasn’t slowed Walmart’s stock from popping on the looming deal.

“We have an announcement of an India deal, but still no timeline about when it comes into effect and whether the secondary tariffs, the 25 percent linked to India’s purchase of Russian oil, when those would be removed, so I think there’s still a lot of questions,” economist Rachel Ziemba, founder of Ziemba Insights, told Al Jazeera.

While there are limited details on the specifics of the deal, markets are responding to tariffs likely to come down.

“Markets are, of course, forward-looking. I think this sort of reinforces a view in the marketplace that incremental tariffs will be less this year,” Ziemba said.

The big box retailer jumped from 2 percent of its global exports coming from India in 2018 to 25 percent in 2023, according to a Reuters review of import data in 2023. Walmart hopes to source $10bn in goods from India by next year.

At the time, the company also decreased its percentage of goods from China to 60 percent from 80 percent.

Walmart did not respond to Al Jazeera’s request for comment.

The Federation of Indian Export Organisations (FIEO), a lobby for exporters, said the cut in US tariffs will significantly boost Indian exports, including textiles and apparel, putting them on par with Asian peers, such as Vietnam and Bangladesh.

According to data from ImportYeti, a platform that tracks import contracts for major companies, Walmart’s biggest import areas are in home fabrics, apparel and toys.

“Those are the products facing the highest tariffs, while consumer electronics and other categories have largely been shielded. If the India–US deal becomes a reality, it would put tariffs on Indian goods entering the US at roughly the same level as those from Southeast Asia, making that supply-chain realignment more attractive. You also highlight the importance of the Indian market,” Ziemba added.

While the trade deal is in focus, Walmart has also invested significantly in India domestically, as well, and holds an 80 percent stake in India’s e-commerce giant Flipkart.

C-suite changes

The surge also comes concurrently with a shake-up in the C-suite. On Monday, John Furner took over as Walmart’s chief executive, succeeding longtime CEO Doug McMillion who announced his retirement late last year.

Furner, who started at the company in a job stocking shelves, has climbed up the ladder. Most recently, he served as the CEO of Walmart US, where he focused on key initiatives driving growth, including curbside pick-up. Prior to that, he served as the CEO of Sam’s Club, Walmart’s wholesale chain.

Furner’s appointment comes as the company grows as an e-commerce giant and intends to double down in AI tech, healthcare services, e-commerce, and hybrid options with its brick-and-mortar footprint.

“As AI rapidly reshapes retail, we are centralizing our platforms to accelerate shared capabilities, freeing up our operating segments to be more focused on and closer to our customers and members,” Walmart said in a statement last month.

“Walmart is masterful at brick-and-mortar retail and remains highly competitive with Amazon. I love that because it shows consumerism is still alive and well. Five years ago, the narrative was the fall of the mall and the decline of retail. This confirms the opposite. Walmart also has a clear strategy for retaining consumers and managing the customer experience,” Brett Rose, CEO and founder of United National Consumer Suppliers (UNCS), a distributor that focuses on excess inventories, which it provides to more budget-friendly retailers, told Al Jazeera.

The tech-centric focus comes as e-commerce has grown for the company, which reported a 28 percent jump in e-commerce sales compared with the previous quarter. Walmart is slated to release its next earnings report on February 19.

“What you need to look at is that Walmart has successfully become a marketplace, not as big as Amazon, but big enough to give it a run for its money,” said Rose.

Cuban diplomat says Havana is ready for dialogue with Washington, but certain things are off the table, including the constitution and its socialist government.

Cuba and the United States are in communication, but the exchanges have not yet evolved into a formal “dialogue”, a Cuban diplomat has said, as US President Donald Trump stepped up pressure on Havana.

Carlos Fernandez de Cossio, Cuba’s deputy foreign minister, told the Reuters news agency on Monday that the US government was aware that Cuba was “ready to have a serious, meaningful and responsible dialogue”.

De Cossio’s statement represents the first hint from Havana that it is in contact with Washington, even if in a limited fashion, as tensions flared in recent weeks amid Trump’s threats against the Cuban government in the aftermath of the US military’s abduction of Venezuelan leader Nicolas Maduro, Cuba’s longstanding ally.

“We have had exchange of messages, we have embassies, we have had communications, but we cannot say we have had a table of dialogue,” de Cossio said.

In a separate interview with The Associated Press news agency, De Cossio said, “If we can have a dialogue, maybe that can lead to negotiation.”

The deputy minister also stressed that certain issues are off the table for Cuba, including the country’s constitution, economy, and its socialist system of government.

On Sunday, Trump indicated that the US had begun talks with “the highest people in Cuba”.

“I think we’re going to make a deal with Cuba,” Trump told reporters at his Mar-a-Lago estate in Florida.

Days earlier, Trump had referred to Cuba in an executive order as “an unusual and extraordinary threat” to US national security, and warned other countries he would impose more tariffs on them if they supplied oil to Cuba.

On Monday, Trump reverted to issuing threats to Havana, announcing at the White House that Mexico “is going to cease” sending oil to Cuba, a move that could starve the country of its energy needs.

Mexico, which has yet to comment on Trump’s latest statement, is the largest supplier of oil to Cuba.

Mexico had repeatedly said that it would not stop shipping oil to Cuba for humanitarian reasons, but also expressed concern that it could face reprisals from Trump over its policy.

In recent weeks, the US has moved to block all oil from reaching Cuba, including from Cuba’s ally Venezuela, pushing up prices for food and transportation and prompting severe fuel shortages and hours of blackouts, even in the capital, Havana.

Responding to Trump’s threat regarding oil supplies, Cuba’s De Cossio said that the move would eventually backfire.

“The US… is attempting to force every country in the world not to provide fuel to Cuba. Can that be sustained in the long run?” de Cossio said to Reuters.

The US has imposed decades of crushing sanctions on Cuba, but a crippling economic crisis on the island and stepped-up pressure from the Trump administration have recently brought the conflict to a head.

United States President Donald Trump has announced the launch of a strategic minerals stockpile.

The stockpile, called Project Vault, was announced on Monday. It will combine $2bn of private capital with a $10bn loan from the US Export-Import Bank.

It is the latest move by the White House to invest in rare-earth minerals needed in the production of key goods, including semiconductor chips, smartphones and electric car batteries.

The aim is to “ensure that American businesses and workers are never harmed by any shortage”, Trump said at the White House.

The move to develop a strategic stockpile is the latest in a slew of efforts by the Trump administration to take control of the means of production for critical rare-earth materials to limit reliance on other countries, particularly China, which has held up its exports to gain leverage in negotiations with Trump.

Here’s a look at some of the investments the US government has made in this space.

What are the investments?

In 2025, the Trump administration acquired equity stakes in seven companies by converting federal grants into ownership positions. Among the investments is a 10 percent stake in USA Rare Earth, which plans to build rare-earth element and magnet production facilities in the US.

The project is supported by $1.6bn in funding allocated under the CHIPS Act, legislation passed during the administration of former Democratic President Joe Biden, aimed at reducing dependence on China for semiconductor manufacturing.

USA Rare Earth announced the investment last week and expects commercial production to begin in 2028.

The US government also acquired a roughly 10 percent stake, valued at about $1.9bn, in Korea Zinc to help fund a $7.4bn smelter in Tennessee through a joint venture controlled by the US government and unnamed US-based strategic investors, who would then control about 10 percent of the South Korean firm.

The venture will operate a mining complex anchored by two mines and the only operational zinc smelter in the US. Construction is set to begin this year, with commercial operations expected to start in 2029.

In October, the government announced a $35.6m investment to acquire a 10 percent stake in Canadian-based Trilogy Metals to support the Upper Kobuk Mineral Projects (UKMP) in Alaska. The investment backs the development of critical minerals, including copper, zinc, gold, and silver, in Alaska’s mineral-rich northwest Ambler mining district.

Also in October, the US announced a 5 percent stake in Lithium Americas as part of a joint venture with General Motors (GM) to fund operations at the Thacker Pass lithium mine in Nevada. The project will supply lithium for electric vehicles and has attracted significant interest from the Detroit-based automaker.

In August, the White House acquired an almost 10 percent stake in Intel. The government’s investment in the semiconductor chip giant was an effort to help fund the construction and expansion of the company’s domestic manufacturing capabilities.

In July, the White House announced a 15 percent investment in MP Materials, which operates the only currently active rare-earth mine in the US, located in California. The largest federal stakeholder in the investment is the Department of War, then called the Department of Defense, which committed $400m.

The US is also reportedly exploring an 8 percent share in Critical Minerals for a stake in the Tranbreez rare-earths deposit in Greenland, underscoring Trump’s unsolicited attempts to acquire the Danish self-governed territory, the Reuters news agency reported.

Amid news of Trump’s stockpile plan, sector stocks are mixed. MP Materials and Intel are up 0.6 percent and 5 percent, respectively. Others finished out the day trending downwards. Lithium Americas is down 2.2 percent. Trilogy metals is down almost 2 percent, USA Rare Earth is down by 1.3 percent, and Korean Zinc finished down 12.6 percent.

Is this unusual?

The government buying equity stakes in large companies is unusual in US history, but not unprecedented.

During the 2008 financial crisis, the US government temporarily acquired equity stakes in several major companies through the Troubled Asset Relief Programme (TARP). In 2009, TARP provided federal assistance to General Motors, ultimately leaving the government with a more than 60 percent ownership share. This intervention began in the final months of the administration of former President George W Bush. The government fully sold its stake in GM in 2013.

Through TARP, the government also acquired a 9.9 percent stake in Chrysler, which it exited in 2011.

The programme extended beyond car makers to the financial sector. The US government took a more than 73 percent stake in GMAC (General Motors Acceptance Corporation, now Ally Financial), exiting its ownership in 2014. It also acquired nearly 74 percent of the financial services insurance giant AIG, selling its remaining stake in 2012, and took a 34 percent stake in Citigroup, which it fully exited by 2010.

“This isn’t like 2008, when there was an urgent need to shore up critical companies. There’s a much more measured approach here. They [the US government] want these investments to generate returns, and they need to be seen as good investments in order to attract other forms of capital,” Nick Giles, senior equity research analyst at B Riley Securities, an investment banking and capital markets firm, told Al Jazeera.

During the Great Depression, the government bought stakes in several large banks. Before that, at the turn of the 20th century, it bought an equity stake in the Panama Railroad Company, which was responsible for building the railway that would be used during the construction of the Panama Canal. That equity stake was attached to a specific project rather than a more open-ended challenge, such as foreign dependence on critical minerals.

“There may not be a defined end date, but they’re clearly looking to make a return, and it sends an important signal that more is coming. I don’t think they [the government] are going to let this fail,” Giles added.

Political divide on the approach

Interest in providing funds to critical mineral projects was shared by Trump’s predecessor, Biden, who brought in the CHIPS Act for that purpose. Biden was focused on providing grants for projects rather than buying equity stakes.

Trump’s approach to buy stakes is actually more aligned with progressive Democrats than with members of his own party. Vermont Senator Bernie Sanders has long been a proponent of the US government buying equity stakes in companies.

In August, after the White House bought an equity stake in Intel, Sanders applauded the move.

“Taxpayers should not be providing billions of dollars in corporate welfare to large, profitable corporations like Intel without getting anything in return,” Sanders said at the time.

Kentucky Senator Rand Paul, a Republican known for his libertarian stances, called ownership a “terrible idea” and referred to it as a “step towards socialism” on CNBC. North Carolina’s Thom Tillis likened the Intel investment to something that countries like China or Russia would do.

For Babak Hafezi, professor of international business at the American University, the investments are a step to remove any reliance on China.

“Without domestic control and resiliency in both extraction and production, we are dependent on China, which extracts nearly 60 percent of global rare-earth minerals and produces 90 percent of it. This creates a major global chokepoint, and China can use this chokepoint as a means to dictate American Foreign policy via supply chain limitations,” he said.

“Thus, establishing free and open markets for US consumption is critical to remove any dependency.”

It was built on democracy, open markets and cooperation – with America at the helm.

But the rules-based global order created after World War II is now under strain. Conflicts are rising. International rules are being tested. Trade tensions are escalating. And alliances are shifting.

At the centre of it all is US President Donald Trump.

In just a few short weeks, he’s captured Venezuela’s president, vowed to take control of Greenland, and threatened to slap tariffs on those who oppose him.

Meanwhile, China is presenting itself as a stable partner.

Many warn that the global order is starting to break apart.

China is showcasing itself as a solid business and trading partner to traditional allies of the United States and others who have been alienated by President Donald Trump’s politics, and some of them appear ready for a reset.

Since the start of 2026, Chinese President Xi Jinping has received South Korean President Lee Jae Myung, Canadian Prime Minister Mark Carney, Finnish Prime Minister Petteri Orpo and Irish leader Micheal Martin.

This week, United Kingdom Prime Minister Keir Starmer is on a three-day visit to Beijing, while German Chancellor Friedrich Merz is expected to visit China for the first time in late February.

Among these visitors, five are treaty allies of the US, but all have been hit over the past year by the Trump administration’s “reciprocal” trade tariffs, as well as additional duties on key exports like steel, aluminium, autos and auto parts.

Canada, Finland, Germany and the UK found themselves in a NATO standoff with Trump this month over his desire to annex Greenland and threats that he would impose additional tariffs on eight European countries he said were standing in his way, including the UK and Finland. Trump has since backed down from this threat.

China’s renewed sales pitch

While China has long sought to present itself as a viable alternative to the post-war US-led international order, its sales pitch took on renewed energy at the World Economic Forum‘s (WEF) annual summit in Davos, Switzerland, earlier this month.

As Trump told world leaders that the US had become “the hottest country, anywhere in the world” thanks to surging investment and tariff revenues, and Europe would “do much better” to follow the US lead, Chinese Vice Premier Li Hefeng’s speech emphasised China’s ongoing support for multilateralism and free trade.

“While economic globalisation is not perfect and may cause some problems, we cannot completely reject it and retreat to self-imposed isolation,” Li said.

“The right approach should be, and can only be, to find solutions together through dialogue.”

Li also criticised the “unilateral acts and trade deals of certain countries” – a reference to Trump’s trade war – that “clearly violate the fundamental principles and principles of the [World Trade Organization] and severely impact the global economic and trade order”.

Li also told the WEF that “every country is entitled to defend its legitimate rights and interests”, a point that could be understood to apply as much to China’s claims over places like Taiwan as to Denmark’s dominion over Greenland.

“In many ways, China has chosen to cast itself in the role of a stable and responsible global actor in the midst of the disruption that we are seeing from the US. Reiterating its support for the United Nations system and global rules has often been quite enough to bolster China’s standing, especially among countries of the Global South,” Bjorn Cappelin, an analyst at the Swedish National China Centre, told Al Jazeera.

The West is listening

John Gong, a professor of economics at the University of International Business and Economics in Beijing, told Al Jazeera that the recent series of trips by European leaders to China shows that the Global North is listening, too. Other notable signs include the UK’s approval of a Chinese “mega embassy” in London, Gong said, and progress in a years-long trade dispute over Chinese exports of electric vehicles (EVs) to Europe.

Starmer is also expected to pursue more trade and investment deals with Beijing this week, according to UK media.

“A series of events happening in Europe seems to suggest an adjustment of Europe’s China policy – for the better, of course – against the backdrop of what is emanating from Washington against Europe,” Gong told Al Jazeera.

The shifting diplomatic calculations are also clear in Canada, which has shown a renewed willingness to deepen economic ties with China after several spats with Trump over the past year.

Carney’s is the first visit to Beijing by a Canadian prime minister since Justin Trudeau went in 2017, and he came away with a deal that saw Beijing agree to ease tariffs on Canadian agricultural exports and Ottawa to ease tariffs on Chinese EVs.

Trump lashed out at news of the deal, threatening 100 percent trade tariffs on Canada if the deal goes ahead.

In a statement last weekend on his Truth Social platform, Trump wrote that Carney was “sorely mistaken” if he thought Canada could become a “‘Drop Off Port’ for China to send goods and products into the United States”.

The meeting between Carney and Xi this month also thawed years of frosty relations after Canada arrested Huawei executive Meng Wanzhou in late 2018 at the behest of the US. Beijing subsequently arrested two Canadians in a move that was widely seen as retaliation. They were released in 2021 after Meng reached a deferred agreement with prosecutors in New York.

In Davos, Carney told world leaders that there had been a “rupture in the world order” in a clear reference to Trump, followed by remarks this week to the Canadian House of Commons that “almost nothing was normal now” in the US, according to the CBC.

Carney also said this week in a call with Trump that Ottawa should continue to diversify its trade deals with countries beyond the US, although it had no plans in place yet for a free-trade agreement with China.

Filling the void

Hanscom Smith, a former US diplomat and senior fellow at Yale’s Jackson School of International Affairs, told Al Jazeera that Beijing’s appeal could be tempered by other factors, however.

“When the United States becomes more transactional, that creates a vacuum, and it’s not clear the extent to which China or Russia, or any other power, is going to be able to fill the void. It’s not necessarily a zero-sum game,” he told Al Jazeera. “Many countries want to have a good relationship with both the United States and China, and don’t want to choose.”

One glaring concern with China, despite its offer of more reliable business dealings, is its massive global trade surplus, which surged to $1.2 trillion last year.

Much of this was gained in the fallout from Trump’s trade war as China’s manufacturers – facing a slew of tariffs from the US and declining demand at home – expanded their supply chains into places like Southeast Asia and found new markets beyond the US.

China’s record trade surplus has alarmed some European leaders, such as French President Emmanuel Macron, who, in Davos, called for more foreign direct investment from China but not its “massive excess capacities and distortive practices” in the form of export dumping.

Li tried to address such concerns head-on in his Davos speech. “We never seek trade surplus; on top of being the world’s factory, we hope to be the world’s market too. However, in many cases, when China wants to buy, others don’t want to sell. Trade issues often become security hurdles,” he said.

Carney has been under pressure from the opposition to lower prices of food and other essentials for lower-income people.

Canadian Prime Minister Mark Carney has announced a multibillion-dollar package as part of a series of measures aimed at lowering the costs of food and other essentials for low-income families.

On Monday, Carney announced a five-year 25 percent boost to the Goods and Services Tax (GST) credit that starts this year.

The GST credit, which is being renamed the Canada Groceries and Essentials Benefit, will provide additional, significant support for more than 12 million Canadians, Carney said in a statement.

The government will also provide a one-time top-up equivalent to a 50 percent increase this year to eligible residents.

“We’re bringing in new measures to lower costs and make sure Canadians have the support they need now,” Carney said.

The measures would cost the government 3.1 billion Canadian dollars ($2.26bn) in the first year and between 1.3 billion Canadian dollars ($950m) and 1.8 billion Canadian dollars ($1.3bn) in each of the following four years, he told reporters at a news conference, according to the Reuters news agency.

While overall consumer price inflation in Canada has eased and came in at 2.4 percent for December, “food price inflation remains high due to global and domestic factors, including supply chain disruptions, higher US tariffs from the trade war and climate change/extreme weather”, Tony Stillo, director of Canada Economics at Oxford Economics, told Al Jazeera.

The government is also setting aside 500 million Canadian dollars ($365m) from the Strategic Response Fund to help businesses address the costs of supply chain disruptions without passing those costs on to Canadians, and will create a 150 million Canadian dollar ($110m) Food Security Fund under the existing Regional Tariff Response Initiative for small and medium enterprises and the organisations that support them.

Changing landscape

“The global landscape is rapidly changing, leaving economies, businesses, and workers under a cloud of uncertainty. In response, Canada’s new government is focused on what we can control: building a stronger economy to make life more affordable for Canadians,” Carney said.

The new measures were unveiled on the day Parliament resumes after its winter break.

Opposition parties have urged Carney to reduce prices of daily goods, especially as sections of the economy have come under pressure from United States President Donald Trump, who has slapped 35 percent tariffs on the country as well as separate tariffs on steel, aluminium and lumber, leading to job losses in those sectors.

Over the weekend, Trump escalated his threats and said he would impose a 100 percent tariff on Canada if it makes a trade deal with China. Carney has been working on diversifying Canada’s exports away from the US, its biggest trading partner and to which nearly 80 percent of its exports went last year, including by increasing business with other markets like China.