Return to Transcripts main page

Quest Means Business

Strait of Hormuz Closure Constricts Global Crude Supplies; Middle East Conflict Threatens African Economies; TACO Time for Trump; Tax Exiles Aim to Return to UAE. Sheriff: Suspect in Detroit Area Synagogue Attack Dead; Oil Prices Rise After Tankers Set Ablaze Near Iraq; Strait of Hormuz Closure Constricts Global Crude Supplies. Aired 4:00p-5p ET

Aired March 12, 2026 - 16:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

[16:00:15]

RICHARD QUEST, CNN INTERNATIONAL HOST, "QUEST MEANS BUSINESS": The closing bell is ringing on Wall Street. Those of a nervous disposition perhaps

should just look away from -- no, don't do anything like that. There you go. We are off over 700 points. The low point of the session, down 1.5

percent. Let's wait until we've got the gavel done, one and a two and a one, two, three, four. The gavel didn't break. There we go.

The triple stack. Show me the triple stack and you see the worst of the day was the NASDAQ, off nearly more than one-and-three-quarter percent.

Those are the markets and these are the main events.

The news agenda is Michigan Police say a suspect is dead after driving a vehicle full of explosives into a synagogue. We will have that report for

you in just a moment.

Oil prices are hitting $100.00 a barrel as Iran's new Supreme Leader says the Strait of Hormuz must remain closed and while many are scrambling to

get out of the Gulf, some of the Dubai wealthy need to go back home in order to avoid paying taxes elsewhere. We will explain.

Live from New York on Thursday. It is March the 12th. I am Richard Quest and I mean business.

Good evening.

Details coming in now after a suspect rammed a vehicle packed with explosives into a synagogue in Michigan. The police say that the suspect is

dead and no staff or students were hurt in the attack. They say that after the suspect hit the building, security guards opened fire, killing the

suspect in the car.

Emergency responders found what appeared to be a very large amount of explosives in the back of the vehicle. It happened at Temple Israel in West

Bloomfield Township near Detroit, one of the largest synagogues in America.

The facility also houses a school and according to the police, all students are safe.

Jason Carroll is with me.

Insofar as one plans for these things, this sounds like it sort of went the way -- if somebody does try to attack, it is supposed to go, they shot the

assailant dead.

JASON CARROLL, CNN NATIONAL CORRESPONDENT: Well, certainly and if you consider this, Richard, just about five weeks ago, Temple Israel held some

sort of a drill, an active shooter drill where they were training some of their staff for just this type of terrifying situation.

I also want to tell you that just within the past few moments or so, we've now heard from Temple Israel for the very first time. I want to read part

of the statement to you. It says: "Everyone is safe. All 140 students in our Susan and Harold Early Childhood Center, our amazing staff, our

courageous teachers, and our heroic security personnel, all are accounted for and safe."

Again, just to recap some of the details that we have been able to go over, over the past few hours, as you say, a vehicle drove through the front

doors there of Temple Israel in West Bloomfield. This vehicle was able to make its way down some sort of a hallway before security guards there were

able to "engage the threat." That is a quote from Michael Bouchard, the Sheriff there of Oakland County, who said that the suspect was traveling

with "purpose" when he made his way down that hallway.

Again that suspect is dead, and we've just learned within the past hour or so that his -- that the suspect's body is so badly burned, it might be very

difficult in the short term to be able to identify specifically who this person is, and that is where this investigation is now moving forward.

Who this person is? Was this person acting as a lone wolf? Was he acting in connection with others? These are just some of the things that

investigators are going to be looking at as they move forward. But you can imagine, Richard, being a parent and hearing the first calls that were

coming out about this.

QUEST: Right, good --

CARROLL: Sorry. Go ahead.

QUEST: Yes, let me jump in here if I may, please, Jason.

CARROLL: Sure.

QUEST: Because when we look at the aerial pictures of this scene, which we were just looking at a moment or three ago, I mean, this is a -- this is a

sizable -- there we go, we've got them now.

This is a sizable institute. I mean, it is one of the largest synagogues, and with a school, this or that, community center, the actual temple

itself, this is big.

[16:05:00]

CARROL: It is. It is enormous, and you can see there from the aerial shots there of the temple itself and the sort of surrounding buildings, and this

is why when this initially happened, all of the emergency crews that were there on the ground had the task of clearing the building, finding everyone

who needed to be found, getting them the appropriate people out of the building, and then securing the surrounding area as well.

This is some of the things that they needed to do in the initial, moments after this. And as you say, a lot of children were there as well. This is

an early childhood center. In addition being a temple. So you had kindergarten, you had a daycare center there. You have the staff that looks

over that.

So, you had a lot of different sort of people moving in and about that area, which is why there was so much concern for parents who were there on

the ground wondering, is my child okay? Was my child affected by this?

So, a lot of moving parts that they had to deal with. But again, the investigation now is focused on is this person, did this suspect act alone?

Was this person a lone wolf or were there others involved?

QUEST: I am grateful, sir. Thank you, Jason Carroll reporting on that.

To our business headlines: Oil crossed $100.00 a barrel only a day after the record release was announced of strategic reserves. Now, it is going to

take several weeks, if not months for the reserves, 400 million barrels to be released. But Brent, as you can see, that's the one we are looking at,

is up nearly 10 percent. The U.S. benchmark, West Texas also rose sharply as well. And you want to know why?

(VIDEO CLIP PLAYS)

QUEST: There is your reason. Iranian attacks two oil tankers set ablaze in Iraqi waters and one person was killed. This is exactly what people had

feared.

I mean the power of these pictures is exactly why the Strait of Hormuz is closed at the moment, and it is the prospect of more that is keeping the

price high.

Though the first public message from Iran's new Supreme Leader shows no sign of backing down, far from it. Mojtaba Khamenei's statement was read

out on Iranian state T.V. Now, he has not been seen in public since the announcement of his appointment. He warned that the Strait would remain

closed, as he put it, to a tool of pressure, and that all U.S. bases in the region would be attacked if they did not shut down.

Nic Robertson is in Kuwait.

I think, Nic, you can say as much as they like, the U.S. administration about it is over, all bar the shouting, but the only shouting we are seeing

is screams when ships get blown up.

NIC ROBERTSON, CNN INTERNATIONAL DIPLOMATIC EDITOR: Yes, and that ship, those two ships that you saw bursting into a fireball at the Iraqi oil

terminal, that's actually quite a long way out into the Gulf. That's actually about 45 miles from where we are standing here.

The streets are busy behind me in the center of Kuwait City. People are out, it is Ramadan. They are out in the evening taking their families. I am

looking to a gentleman here with his young child on his shoulders. You might see him come into the picture behind me.

I think, it is probably fair to say, if the times weren't so tense, you would not -- you would be seeing a lot more people here. That said, people

in Kuwait City have almost become used to this war happening around them.

This time last night, sirens were going off. Today, five ballistic missiles have been fired incoming to the country. Most of them intercepted, seven

drones, most of them intercepted, a couple falling in open ground.

But Kuwait International Airport today hit by a couple of drones. Infrastructure damaged. No one hurt. An apartment building that was hit

early in the morning. We were down there today right on the shoreline 50 miles across the waters to Iran that was hit by a drone, the apartment

completely blown out, two people injured, being treated in hospital.

So, I think here right now, although you see people behind me out on the streets in the center of the city, I don't think anyone here is believing

that this war is over yet because the rhetoric is hot and what is happening just off their shores here is even hotter -- Richard.

QUEST: And you know, at that time of night, they are getting sort of sitting down to iftar which of course is the evening meal that you have

after a day of fasting which is, I mean celebratory in a sense of people coming together, families, friends always get together for the breaking of

the fast during iftar, which must give a very different complexion at the moment, bearing in mind the worry of drones and missiles and bombings in

the Strait.

[16:10:05]

ROBERTSON: Absolutely, and the government is really reminding people of that. It is telling them, look, normally at this week of celebration coming

up to Eid, you would perhaps have big weddings, big gatherings. The government saying look, don't have weddings, don't have gatherings at this

time. Other years, fine! But right now, the best advice is not to get together in large groups because that creates a vulnerability. The

government is worried about that vulnerability and, you know, I think people here, they don't really need a second telling on it -- Richard.

QUEST: Thank you, Nic. Go and have something to eat yourself. Thank you. Nic Robertson in Kuwait.

The U.S. Energy Secretary, Chris Wright has said the reopening of the Strait is a key military objective, telling us that the war will pay off in

the end.

(BEGIN VIDEO CLIP)

CHRIS WRIGHT, U.S. SECRETARY OF ENERGY: We are going through short-term energy disruption for this huge long term gain. You're seeing Iran's

behavior. They're attacking every country in the region.

We are focused on the military operation and solving a problem. I am not going to guess on short term trading. That's based on psychology more than

flows of oil.

The world is very well supplied with oil right now. Thanks to President Trump's leadership, we are by far and away the world's largest oil producer

by far and away the world's natural gas producer. Both of those are growing.

We are -- we have been moving into an age of energy security, and we are fixing the huge overhang on global energy security, which is Iran's

behavior and Iran's arsenal.

(END VIDEO CLIP)

QUEST: Now, of course, the Secretary there is talking largely about the U.S.' position, the disruption in the Strait, we are seeing that in oil

price spikes and countries scrambling to find alternative supplies.

Most of the oil coming out of the Gulf goes to Asia. That much is very clear and well known. China is the top destination for crude from the

Persian Gulf. Now, in the region they can turn to countries within Asia like Indonesia and Malaysia to make up some of the shortfall.

But their overall production is much less, much, much less than that of the Middle East. And so they can't replace completely. Other options are

further afield. Africa, expensive, and the United States, huge transportation costs. And that is if you can even find sufficient supplies.

Once you do find oil, your next problem is, what sort is it? Because not all crude was created equal. There are different blends based on density,

whether they are sweet or sour, heavy or light. And the refineries where they go to have to be built and they work with a certain type of it.

So with that in mind, Adi Imsirovic is a lecturer in Energy Systems at Oxford University. Sir, I hope that wasn't too basic, but it does make the

point. Youve got light, sweet, crude heavy crude. You've got sour, you've got sweet, you've got this distillery and this refinery. We can't just

simply replace one with the other.

ADI IMSIROVIC, LECTURER IN ENERGY SYSTEMS, OXFORD UNIVERSITY: Absolutely, correct, Richard. There are over 700 different types of crude oil in the

world and when people build the refinery, they normally build the refinery for a particular type of crude oil.

So the refineries in the Mediterranean, for example are generally built for type of crude, like Russian Urals or Kirkuk; Japanese refineries were

primarily built for Saudi crude and so on. So, when you replace that crude, then there is a real problem in trying to refine it. Or if you want, in

simple terms digest it to get the products that you want.

QUEST: Right, but the interesting thing there, of course --

IMSIROVIC: It is not straight forward.

QUEST: Right, but the interesting thing is this sort of cracking ability as you call it, where you can distill and crack out from one to the other.

The U.S. for example, the refineries tend to be very good with heavy oils and yet they manufacture or they produce, I should say light sweet, but

they can mix them, can't they? So what's the problem for the U.S.? Will they face a shortage at any point, do you think?

IMSIROVIC: Well, I think what's happened with the U.S., they now have Venezuelan crude coming their way. They've also been buying a lot of

Canadian crude, which now more and more given all the tariffs and everything is going on between the two countries, is actually going to

Asia, primarily to China.

But essentially there is, you know, they have up until now sufficient supplies. And I don't think that's going to impact the United States as

hard as it is going to impact Asia.

QUEST: Europe and LNG, I mean, such a big effort was made to move off Russia and find -- I mean, Qatar is the number one supplier, of course, of

it for large parts of Europe. That cannot be replaced easily.

[16:15:10]

IMSIROVIC: No, it cannot. To be fair, not that much. Qatar was a sufficient supply to Europe for strategic reasons, but Europe can find alternatives. I

mean, the obvious alternative for Qatari LNG would be United States. We can get LNG from West Africa and so on.

I think, it is actually again, it is Asia that is going to be hit more. But Europe is going to be hit pretty hard, and in particular here in the U.K.,

because gas is our marginal spinning capacity for production of electricity, for generating electricity, what we are going to be hit with

is higher prices.

We have a global market for LNG and that market works very, very well. So if there is a shortage in Asia, Asia bids it up then Europe will end up

paying higher prices and vice versa. At the end of the day, the countries are going to be hit more than anyone else. The poorer countries, such as

Pakistan, Bangladesh and similar importers.

QUEST: When the Energy Secretary says that the short term pain is going to be worth it for the long term benefit, now I am sort of not going to invite

you to comment on that because that's a political aspect of it, which is something off our discussion. But the reality is, do you see this as being

short term gain?

IMSIROVIC: Well, I think you've hit the nail on the head there. I think what the biggest problem is, I used to trade oil for 35 years. And the way

to understand this market and prices actually is to get into the head of oil traders. And I speak to them every day still even though I am an

academic now.

What they are thinking right now, they think of a spreadsheet. What is a shortfall of crude? Currently at least 10 million barrels. What is

happening? We've got IEA releasing the barrels just to give you an idea, United States are saying we are releasing a very, very large volume, 170

million barrels of oil over 120 days, but that's not even 1.5 million barrels a day and you've got a shortfall of at least ten.

So, it is a big gap right there to be filled in. Of course, there are other countries from OECD that will step in and supply their oil. What they want

to know when they are buying and selling is when is the war going to finish, so they can actually work out what the appropriate shortfall is

going to be and what the price is going to be.

QUEST: So, doesn't this show --

IMSIROVIC: And even with that --

QUEST: No, but doesn't this whole -- what you and I are discussing now show that this is a very finely tuned over many years market, but behind it is

real nitty-gritty detail. Is it light, sweet, crude? Is it heavy? Is it going to that refinery? Is it on that ship? Is it going to that market or

that port?

This is not -- I mean, we can talk generalities and principles and, you know, until the ships come home, as they say, but the detail here is what

is really significant in terms of the price.

IMSIROVIC: Exactly. And I think what is very important for your listeners to understand, even if we throw these numbers away and talk about gaps and

shortages and so on, it is a very well-connected over decades perfected supply chain and oil industry is a flow. It is a flow.

When it gets into -- disturbed somewhere, there is a problem. When there is not oil in tank, the appropriate type of oil in tank, refineries have to

cut runs until they get the appropriate oil in tanks, so they can actually produce the products that they are asked to produce, so it is a very finely

tuned in supply chain that very easily can get disturbed if over a long period of time, we have a disturbance.

Short term, it is a very, very resilient market. Traders are there, they will do anything. They will turn a ship around a globe for a couple of

pennies because times two million barrels, it is a lot of money.

And they will make the system work, but when the system is completely broken on several levels, then you have a real, real problem.

And right now, without knowing when this war is going to finish, we do have a problem.

QUEST: I am grateful, sir. Thank you. We will talk more as this progresses because you've given us some very, very good insight. I wish you good

evening in Oxford. Thank you.

When QUEST MEANS BUSINESS continues, more on the breaking news of the attacker who rammed the car into a synagogue in Michigan.

(COMMERCIAL BREAK)

[16:22:46]

QUEST: Law enforcement officials are telling us they are investigating a university shooting in Virginia as terror related. This is different from

the other incident we are talking about. In this case, the suspect is the former Army National Guardsman who was previously jailed for trying to

support Islamic terror groups. Police say, a person has been killed, two others hurt. After that, the suspect opened fire at the Old Dominion

University. The suspect is dead.

And the breaking news out of Michigan, so we are talking about two separate incidents here. The police say the suspected attacker is dead ramming their

vehicle into a synagogue near Detroit. The Sheriff says the suspect drove through the doors of the building before security engaged in gunfire, they

then found what appeared to be a large amount of explosives in the back of the vehicle.

Sources told the police that the suspect's body was badly burned.

John Miller is with me.

Let's parse them out, if we may, John. Let's do this.

The Detroit one first, and I am not minimizing in any way, but it does sound as I was saying earlier to our correspondent, this sounds like just

if you're going to have these events happen, this is how it is supposed to be handled.

I mean, if you haven't stopped them at the gate and they've got this far, this is exactly textbook of what is meant to happen.

MILLER: And not an accident by any measure, Richard, because the sheriff and the Police Chief there, both drilled at that location for an active

shooter drill, just five weeks ago. They have been in daily contact with each other, exchanging intelligence and dealing with the Jewish

organizations that work for the overarching security for Jewish facilities.

They have been in contact with the school and the synagogue, so a lot of that synergy came together today when -- and I mean, try to picture this

and someday we will see this video, but when this vehicle drives through the doors of the school and comes ramming down the hallway, the security

people responded immediately, opened fire on the individual who was driving this vehicle, but also appears from that video because what it looks like

on the video, as you can see, shell casings coming out the window, appears to be firing as he is driving.

[16:25:12]

And now, we understand that there may be an amount of explosives that look like mortar shells in the back of that vehicle. So theoretically, it was a

ramming attack that was meant to run people over a truck that was meant to explode, and a shooter who meant to kill a lot more people than ended up

happening because of that quick response by security.

QUEST: And this other incident that we are looking at in Virginia, terror related said the investigators, university shooting, one person killed. I

mean insofar as there are always going to be these number of events, the war in the Middle East gives it a different focus in a sense. It almost

puts them on steroids because we notice them more. We are much more conscious of them and the possibility of them happening, but they are

always there.

MILLER: Well, Richard, I think if you look at what is really happening here, you might have put your thumb on it because two weekends ago we have

an attack in Austin, Texas, of an individual who attacks a nightlife zone. Last weekend, we had two people at Gracie Mansion throw bombs at protesters

that were supposed to go off and injured and should have injured scores of people, but the bombs didn't function. Police moved quickly.

And then you look at this morning at Old Dominion University, a former ISIS supporter who had just gotten out of jail in 2025, shoots up the ROTC

classroom, killing the instructor before he is stopped and this incident today. That is quite a pace, and it is -- the war between the U.S. and Iran

is stirring the pot because most of these we are going to end up learning, were individuals who were acting alone or acting in the case of Gracie

Mansion, two of them together who met on the internet, got their propaganda and their inspiration on the internet in almost every case.

QUEST: So, one final point, just slightly off piece, as they say. You know, I flew in yesterday from London, landed at Newark, and as I came through

the baggage hall and, you know, take it from me, I've been through there enough times to know that what I saw was not an average day at 10:00 or

11:00 in the morning. I was on the first flight in.

There must have been 12 to 15 CBP officers, all in a long line that you had to walk past before you went out of Customs Hall, stopping some, not

stopping others. It had a much more rigid feel as if security overall had been dramatically upgraded.

MILLER: Well, and that's correct. And you will see that if you walk through Penn Station or Grand Central, you'll see more National Guard people with

long rifles when you walk through that entrance to Immigration.

QUEST: Yes, that's right.

MILLER: Those CBP people are picking people out at random, you know using a numeric formula, but also studying behavior and how people are looking and

acting in terms of you know, how do they react to seeing that security? So there is -- there is an uptick that is meant to be high profile, high

visibility but it is an uphill struggle when you see the randomness of the places and the timing of these attacks.

QUEST: John, I am always grateful as always and thank you very much indeed.

MILLER: Thanks, Richard.

QUEST: QUEST MEANS BUSINESS, the impact of the Middle East War being felt globally, just talking there, the price ordinary people in Africa may have

to pay. There are fears of an economic impact and it could be enormous.

In a moment, we will talk about that.

(COMMERCIAL BREAK)

[16:31:51]

RICHARD QUEST, CNN INTERNATIONAL ANCHOR: Hello, I'm Richard Quest. We have together a lot more QUEST MEANS BUSINESS. I'm going to tell you how the war

is also impacting African economies, and they depend on imported petroleum from the Gulf. And Dubai's wealthiest people, they left and now need to

return. Why? To avoid paying taxes elsewhere. That's the point about tax havens.

We'll only get to that taxing issue in a moment. It's CNN and here on the news it'll always come first.

Iran's new supreme leader is vowing revenge on the United States and Israel. In his first purported message, Mojtaba Khamenei says Tehran will

keep the Strait of Hormuz closed as a tool of pressure. He said Tehran believes in friendship with its neighbors and claims Iran is only targeting

U.S. bases in the region. Excuse me.

The police say a suspected attacker is dead after ramming their vehicle into a synagogue near Detroit, in Michigan. The sheriff says the suspect

drove through the doors of the building before security engaged in gunfire. They found what appeared to be a large amount of explosives in the back of

the vehicle.

U.S. Congressman James Clyburn said he will run for the 18th term in House of Representatives. Now he's 85 years old and he's one of several Democrats

who had resisted calls to make way for younger candidates. Clyburn is the only Democrat from South Carolina in Congress. He was last reelected by

more than 20 percent margin.

in the last few hours, Donald Trump has posted to Jerome Powell should cut interest rates now, and that the necessity is to cut interest rates. Well,

the Fed probably won't take too much notice of that but they will have to take into account rising oil prices when it sets interest rates next week.

Goldman expects the rate cut next one will be in September rather than June. It's also warning that persistently high oil prices pose a threat to

economic growth. Goldman has raised its forecast for core PCE, that's the one that the Fed looks, at the preferred gauge to 2.4 percent in December.

It's slightly lowered its forecast for GDP growth.

Richard Haass is with me, president emeritus at the Council on Foreign Relations. He's also held senior roles in the U.S. State Department.

Richard, it is good to have you as always, sir. Before we get to the Feds and interest rates, how foreseeable was all this mess as a result of higher

oil prices? How foreseeable was it knowing the region, knowing the difficulties that if you start a war, you're not going to be able to

contain it?

RICHARD HAASS, PRESIDENT EMERITUS, COUNCIL ON FOREIGN RELATIONS: Look, it's easy to say in hindsight but I actually thought it was pretty foreseeable,

which is the reason that not just me, but quite a lot of people were critical from the get go.

[16:35:10]

Given the nature of this Iranian regime, the idea that even if it were militarily defeated on the battlefield, the idea that the government would

unravel seemed to me wishful thinking. The vulnerability not just the straits but regional facilities was great. So the idea that we'd be in

something like where we are, it was not a -- it was not all that hard to divine, to be perfectly honest.

QUEST: And the risk is, to use that horrible phrase that economists use and the market makers use, the risk is what, on the upside or the downside at

the moment?

HAASS: I would say it's still on the upside. I don't think any of us can feel comfortable that this, you know, is on its way, winding down where you

began before, as Iran has clearly decided that it can perhaps endure a longer conflict better than the United States and its partners can. So I

think it's premature not just to be declaring victory, but to be saying that this is going to be a short duration crisis and then we go back to the

status quo ante. All of that seems to me to be wishful thinking.

QUEST: Economically it's a pain point for the president, isn't it, which, how much he's prepared to? Now, we've had a raft of administration

officials of one stripe or another saying that short-term pain is necessary for long-term gain. Chris Wright, the Energy secretary, is the latest one

who's been touting that particular line. But they have to say that because the alternative is too unpalatable.

HAASS: Yes, short-term pain leading to long-term pain is not exactly a winning bumper sticker. No, it'd be a lot easier to take those kinds of

comments seriously if there was a clear strategy with achievable objectives. And let's be blunt, that isn't the case. So I hope I'm wrong

here, but it comes off as happy talk. And as we're seeing, it's not keeping the price of oil down. It's not reassuring the equity markets. And I think

that's telling you something.

QUEST: Can I just put it to you? I keep hearing people say that there is no definable or goal that the president has said. But when I read, for

example, Hegseth, who says -- the Defense secretary, who says, look, the goal is really simple. It is degrade Iran's capability, destroy its forces

so that it can't wage war, and it can't get a nuclear bomb.

The president says the same sort of things. Is that not in of itself a goal sufficient?

HAASS: It is a goal. And we have degraded Iran's ballistic missile force. We've degraded its Navy. We've probably degraded to some extent their drone

capabilities, but a lot survived. A big part of their nuclear capabilities survived, and uranium -- enriched uranium in the vicinity of Isfahan, who

knows where else in the country. Some of it might be stored.

So I think there's a limit to what military force can accomplish. It can't prevent Iran from doing the sorts of things it's doing to disrupt shipping,

to attack and potentially water or gas and oil facilities. It can't bring about a change in regime in the ways we want, or at least there's no

guarantee it will. So I think, on one hand, you can make progress on the battlefield but not bring yourself any closer to your objectives, and not

be in a position to prevent the other side from imposing real costs on you. Multiple things can be true at one and the same time.

QUEST: And I'm grateful, sir, for you. How kind of you to give us time tonight. Thank you, sir. I'm grateful.

HAASS: Thank you.

QUEST: The war with Iran is also impacting African economies. They depend on imported petroleum from the Gulf and there are fears they could see much

higher fuel costs, in a moment.

(BEGIN VIDEOTAPE)

LARRY MADOWO, CNN CORRESPONDENT: This tanker is delivering more fuel to a gas station in Nairobi so stocks still exist right now. The government in

Kenya reassuring citizens that there are no immediate fears of a fuel shortage. Prices have also not spiked as yet. People are still fueling at

regular prices. Governments across Africa, many of them reassuring their citizens that they have stocks to last them for the time being.

But they can't make long-term guarantees because many African nations depend on imported refined petroleum from the Gulf. That is where the

challenge is.

(Voice-over): This conflict just crossed the 12-day mark, and one economist tells CNN African nations should start preparing for a catastrophic

scenario.

KWAME OWINO, CEO, INSTITUTE OF ECONOMIC AFFAIRS KENYA: While North African countries are directly involved in the conflict, we still suffer quite

substantially. Governments need to adjust. What does it mean for governments to have. So for instance, the government of Kenya has some of

the highest taxes globally on fuel prices so adjusting fiscal policy to allow for greater affordability is important, even if it means that

government will have a lower take.

[16:40:08]

MADOWO: Africa's most advanced economy, South Africa, is one of those exposed to the oil price shocks. It is a net importer of fuel. This is

video from Thursday at gas stations. One South African airline, FlySafair, announced it would be adding a temporary dynamic fuel surcharge after jet

fuel prices rose by 70 percent in one week. At South African airports, other airlines including national carrier South African Airways said they

were monitoring prices.

I also want to show you this video from gas stations in Nigeria. It is Africa's most populous nation, one of the largest economies. It is also a

crude oil producer, so it's likely to cash in on the increase in global oil prices alongside other countries in Africa that produce oil, such as

Angola. But Nigeria still imports refined petroleum, so it is not immune from the shocks that the global markets are seeing.

The bigger picture here is that African economies are more fragile than stronger, more advanced economies.

OWINO: These economies are small and fragile. They are dependent on those imports. So when there's a global conflict such as the one that it does, it

affects these economies. And African economies also tend to recover slowly, much -- to have a slower path of recovery.

MADOWO: Fuel prices are holding steady right now. But if the conflict with Iran drags on, just about everything here in Kenya and across the African

continent will get more expensive. Adding more pain for African consumers.

Larry Madowo, CNN, Nairobi.

(END VIDEOTAPE)

QUEST: President Trump is again claiming victory in the Middle East war and oil markets are absolutely saying, hey, not so fast. Some are asking if

Trump is trying to do a TACO. You know what that is, of course. We'll explain how it applies in this case.

(COMMERCIAL BREAK)

QUEST: Even as the Middle East war rages, President Trump is claiming the U.S. has won. The president's timeline for the war keeps shifting. He

previously said it could take up to six weeks, then on Wednesday, he insisted the U.S. has already gained the upper hand.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: Over the past 11 days, our military has virtually destroyed Iran. It's a tough country. Their air

force is gone, totally gone. That took, that took the better part of about three hours. They no longer have radar. They don't have anti-aircraft

equipment. They don't have anything. Their missiles are down 90 percent.

[16:45:02]

Their drones are down 85 percent. We're blowing up the factories where they're made left and right.

(END VIDEO CLIP)

QUEST: This may be Donald Trump's way of trying to correct course, as he did with tariffs and Greenland. This pattern of escalation and de-

escalation, it's known on Wall Street as TACO, the TACO trade, if you like. Trump always chickens out. The man who's heard this more often than not is

the man who coined the phrase, Robert Armstrong.

I sometimes wonder, sir, whether when we all use that phrase TACO you have an involuntary twitch and sort of hit your head against a brick wall. You

must be -- a bit like bricks and Jim O'Neill.

ROBERT ARMSTRONG, U.S. FINANCIAL COMMENTATOR, FINANCIAL TIMES: I'm sorry that (INAUDIBLE) every time.

QUEST: Not yet, not yet. But listen what I want to know, Robert, is what, for you, what does TACO look like in this scenario of this war?

ARMSTRONG: It looks different. I think that's the crucial thing. Of course, that phrase came around and became popular around the issue of tariffs as

you mentioned. And the key feature of tariff policy is at least until the Supreme Court had its say, it was completely under Trump's control. He can

tariffs into existence and he could make them disappear with the stroke of a pen.

I think what we've discovered here in the last few days is that he can't do that with wars halfway around the world. So he may want to TACO, and I

think that's what you saw in that big speech a couple of days ago, that we just heard some of. But it's not so easy.

QUEST: But surely, forgive me, they're not so naive or so blinded by their own position that they don't realize that no amount of saying we are

winning will make it true if they're still blowing up oil tankers in the strait.

ARMSTRONG: I think you mentioned exactly the right point. What takes this out of Trump's control is that either that strait is open or it's closed,

and if it's closed, 20 percent of the world's crude oil supply is stuck. And that is something that people are going to notice. You can't rhetoric

your way out of $5 gasoline, for example. And if the price of oil stays consistently above $100, $5 gasoline is what we're going to get.

QUEST: So then I realize this is hypothetical and humor me if you will, if they manage to get the strait open, it's a big if, but humor me. If they

get the strait open and they then sort of TACO down with, we've won, it's open, oil prices come back down again, can you say that's a TACO when, for

instance, there's still a regime that's highly unfriendly to you? They can still live to fight another day. But if you say often enough we've won,

then people might just go with it.

ARMSTRONG: I think that's entirely possible, and I think that's the scenario that Wall Street was really hoping for going in, that there --

that bombs would be dropped, Iranian war-making capacity would be diminished. And then both sides would be able to -- would be able to claim

victory. Iran would say we survived. America would say we won, we've crushed the enemy, and everybody could go home and focus on something else.

But, I mean, you know as well as I do, that's just not how it looks right now.

QUEST: Sure. Robert, I'm so grateful. Thank you for joining us. Send the royalties bill for the TACO references to the usual place. Thank you, sir.

ARMSTRONG: I will. Cheers.

QUEST: Now, there are many people were desperate to leave the Gulf region. And for very good reason. Now they want to go back. Getting back to the UAE

could be vital if you want to avoid being taxed in another jurisdiction. We'll explain.

(COMMERCIAL BREAK)

[16:51:53]

QUEST: When the bombs started dropping in the Middle East, many foreign nationals immediately looked for ways to get out and fly home. They're

trying to find a seat on an outbound flight. Now some residents of the UAE are desperate to get back to places like Dubai because of tax, lack of it.

The UAE doesn't tax salaries or wages and to be eligible, you need to spend at least 183 days in the UAE during a -- it's a very complicated. The rules

and the deadlines and all that sort of stuff.

If you're away too long, your tax status could be at risk. And if you are in another jurisdiction, like, for example, the U.K. and you hit the

residency test there, you could end up being taxed in that jurisdiction instead.

Ronald Graham is a lawyer, joined to explain the rules, managing partner of Taylor Wessing, a global firm, who joined us from Dubai.

This is tricky, isn't it? And, you know, let's not have any schadenfreude because we're a business show and we talk about these sort of issues. The

fact is, if you've set yourself up as being taxed nonresident then you need to make sure that you are -- you follow the rules and now you could be in

trouble.

RONALD GRAHAM, MANAGING PARTNER, TAYLOR WESSING: Yes, that's quite right. And I like the last point you made, Richard, which I think is actually the

more important point is that people who quite rightly for safety or welfare reasons are deciding to go back to their original company country, their

home country, it could be the U.S., it could be the U.K., it could be many others those are the jurisdictions that you need to be most careful of.

And if I can expand on that and I will keep this quite general rather than getting too deep into the tax, obviously the U.S. has a worldwide

citizenship taxation that would apply. So you might say, well, that doesn't really matter then because you're always going to be paying tax. But

there's a nice little exemption in the U.S. tax law that allows you to not pay tax if that income is classified as foreign earned income.

However, you must spend 330 days outside of the U.S. so barely five weeks are allowed back in the U.S. before you would lose the tax exemption on

130,000 which is the amount, $130,000, which is the amount you can you can be. So U.S. citizens are not completely out of this. They do have a nice

advantage by being in Dubai, and many of them obviously have gone back to the U.S. But some of them, because of this rule, have gone to Europe

instead rather than go into U.S.

QUEST: So who do they need to be most worried of? Let's say HMRC, IRS or the Dubai authorities?

GRAHAM: Definitely IRS and HMRC. The Dubai rules, let's come to them. You mentioned the 183-day rule. That's true. Any person without any ties to

Dubai who spends 183 days or more in the UAE, it will be classified as tax resident and can go along and get a form and say, yes, I'm tax resident in

there.

QUEST: Sure.

GRAHAM: But the UAE has a codified modern tax residency regime and it's to be complimented on that.

[16:55:04]

It introduced it in 2023. And there is a second tier, which is a 90-day rule and that was brought in, Richard, to cover people that are travelers.

QUEST: Right.

GRAHAM: That have essentially a base in Dubai. They have their residency permit, they bought a house or they have a job there so they're very much

based in the UAE but they are global citizens. And many of the expats and the resident tax residents in Dubai are global citizens.

QUEST: I want to just finish, you know, you, your family, your colleagues, how are you all bearing up in all of this? Because I know from all my

colleagues who are with -- who are in the UAE nightly you hear the explosions of the intercepts. You can see sometimes the bangs and that your

children get concerned. How are you all bearing up? What's life like?

GRAHAM: You know, it's been a tough 12 days since it started. I would describe the situation as tense but calm. I, my family, have no plans to

leave. I've been in the office most days. I was in the office today. I can't say it's business as normal but people are working as normal, albeit

most of them are working from home.

People are concerned if, you know, shrapnel has fallen or they've had particularly loud explosions but I think the, you know, the UAE government

is to be commended for the very high rate of interception of missiles and drones and that has given many, including myself, a very high degree of

safety in the UAE and that's why I'm going to remain here.

QUEST: I'm grateful, sir. We'll talk more about this as it progresses. And as I always say to any time a lawyer is on the show, send the bill to the

usual place. Thank you, sir.

GRAHAM: Thank you.

QUEST: And we will -- I'm not sure I could afford your fees, actually, but there you are. We can make the offer. We'll have a "Profitable Moment"

after the break. QUEST MEANS BUSINESS. Good evening.

(COMMERCIAL BREAK)

QUEST: Tonight's "Profitable Moment."

It's starting to get a little bit wearying when the U.S. administration keeps telling us that victory is here and that it's all over bar the

shouting and that prices will come down. Because for one simple reason, they cannot know that. What we are now seeing was entirely predictable. And

indeed it was predicted that if you had a full scale war in the Middle East of this nature, then oil prices would rise because the very choke point

that you are talking about, the strait, is under the control of somebody else.

And no amount of wishing of president, defense secretary, energy secretary, can change that simple fact that as long as Iran has the chokehold of the

strait and we have bombs and we have tankers blowing up the oil price risk must be on the upside. And that's not going to change because somebody says

short term pain.

And that's QUEST MEANS BUSINESS for tonight. I'm Richard Quest in New York. Whatever you're up to in the hours ahead -- I'll have a second one. I hope

it's profitable. I'll see you tomorrow. It's Friday.

END