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Coming Up This Week

  • On Wednesday, the U.S. Federal Reserve releases a policy statement and its first new set of economic projections since December. (The OECD also releases its forecasts on Wednesday).

  • This week marks six months since Pres. Xi Jinping became involved in the coronavirus response and China announced it had mapped the coronavirus genome. Even though there were known cases before that, those events are widely seen as marking the start of the pandemic.

LME Commodity Spot Prices

  • Aluminum: $1,554/ton

  • Copper: $5,588/ton

  • Cobalt: $29,500/ton

  • Gold: $1,680/toz

U.S.

  • There were massive protests over the weekend against racism and police brutality in U.S. cities and around the world. Several U.S. cities faced calls to defund their police departments and redirect that funding to other programs.

  • Despite isolated violent incidents, experts don’t see any evidence that extremist groups from either end of the political spectrum are coordinating to cause violence.

  • New York City began reopening today, after over two months in lockdown.

Afghanistan

  • U.S. envoy Zalmay Khalilzad met the Taliban’s deputy leader Mullah Baradar in Doha and Pakistan’s Chief of Army Staff in Islamabad yesterday. He discussed the Afghan peace process in both meetings (but didn’t release details of the discussions).

Venezuela

  • Venezuela’s new system for gas sales isn’t solving its problematic lengthy gas lines—at least not at the stations selling subsidized fuel (lines are shorter at the stations selected to sell gas at prices closer to those in the international market). Many Venezuelans can only afford the subsidized price, so have no choice but to wait 10+ hours in lines at subsidized stations.

  • A Post article pasted below criticizes Pres. Trump’s tough policies on Iran and Venezuela for doing more to bring America’s foes together than to bring them down.

Libya

  • There are new reports that Khalifa Haftar proposed a ceasefire in Libya to start today—although the GNA has yet to accept. Haftar’s so-called “Cairo declaration” (because Egypt’s Pres. Sisi announced it after talks with Haftar in Cairo) calls for the withdrawal of all “foreign mercenaries” from Libya, as well as the dismantling of militias in Libya.

  • The GNA is still pressing ahead with plans to capture strategic sites in Libya, including Sirte and the Al Jufra airbase that currently hosts Russian Su-24s. Russia, which allies with the LNA, has warned the GNA against advancing.

Other News

  • There are reports that illegal loggers and miners in Brazil have been taking advantage of coronavirus-induced chaos to grab resources while police are absent.

Maximum pressure on Iran and Venezuela has brought them together to embarrass the U.S. (WaPo)

THROUGHOUT THE covid-19 pandemic, the Trump administration has relentlessly pursued its “maximum pressure” campaigns against Iran and Venezuela, heaping on more sanctions in the apparent hope that one or both regimes would crack under the combined strain of the virus and economic strangulation. Yet the most visible result of the policy to date has been to bring the two nations together to orchestrate an embarrassing display of U.S. impotence.

Last Tuesday, the last of five Iranian tankers arrived in Venezuela, sailing past U.S. warships deployed in the Caribbean. They were delivering an estimated 60 million gallons of gasoline to fuel-starved Venezuelans, in defiance of U.S. sanctions on both countries. Secretary of State Mike Pompeo derided the delivery as “just enough gasoline for a couple of weeks.” But that understates the deal between the two countries: Iranian aircraft have also delivered parts and technicians to repair Venezuela’s crumbling refineries, and the government of Nicolás Maduro is believed to have repaid Tehran with gold bars worth between $500 million and $700 million, according to several reports.

The Trump administration tried to stop the shipments with threats of sanctions: Two additional, Liberian-flagged tankers were induced to turn around. But it elected not to intercept the Iranian ships after the regime of Ayatollah Ali Khamenei vowed to retaliate. Iran’s capacity to attack oil shipping in the Persian Gulf months before the presidential election was evidently enough to deter President Trump.

The result was a propaganda victory for the Maduro and Khamenei regimes, which show no signs either of yielding to U.S. pressure or succumbing to domestic unrest. More cooperation between them seems to be in train: Mr. Maduro said he would soon visit Tehran, and he recently appointed Tareck El Aissami, a key ally of Iran, as oil minister.

Adm. Craig Faller, the head of the U.S. Southern Command, said last month that recent Iranian contacts with Venezuela had included the Quds force, the elite military unit formerly commanded by Qasem Soleimani, the general killed in a U.S. drone strike in January. Adm. Faller said Iran’s objective was to “gain positional advantage in our neighborhood in a way that would counter U.S. interests.”

U.S. officials say they will not tolerate systematic Iranian supplies of gasoline to Venezuela, and it’s not clear Tehran will have the capacity to continue them as its pandemic lockdown eases and Iranians return to their vehicles. But the strengthening alliance between the two states illustrates the downside of Trump policies that aim for regime change, but aren’t able to deliver it — or even to contain the inevitable blowback.

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