The U.S. will engage in “technical talks” with Iran and remains committed to finding a solution to the conflict, despite the two countries trading airstrikes in recent days, MS Now reported Thursday, citing a U.S. official.

The official said President Donald Trump had made his position clear and characterized Iran’s attacks on commercial vessels as “acts of terrorism,” according to MS Now.

Those comments come after Trump at the NATO summit in Ankara, Turkey, said that the ceasefire with Iran was “over.”

The memorandum of understanding between the two countries is performance-based, and Iran’s actions constitute “failed performance at an unacceptable level,” the U.S. official told MS Now, adding that talks with Tehran will continue.

The ceasefire signed last month has come under serious strain in recent days with the U.S. and Iranian forces conducting strikes this week. “I don’t want to deal with them [Iran] anymore,” Trump said at the NATO summit. 

On his way back from the summit, Trump said that Iran had called to make a deal to cease the escalating hostilities in the Middle East. “They called a little while ago. They want to make a deal so badly. I just don’t know if they’re worthy of making a deal. I don’t know that they’re going to honor the deal. That’s the problem,” he said.

Iranian officials have accused the U.S. of not honoring the MOU, citing violation of “Iranian adjustments” in the Strait of Hormuz, “persistent threats of further strikes” and reinstating oil sanctions.

The U.S. military conducted renewed rounds of offensive strikes against Iran in retaliation for three commercial vessels transiting the Strait of Hormuz coming under attack. The U.S. Treasury Department subsequently withdrew a waiver that had allowed Iran to sell its oil.

Oil prices were marginally lower on Friday in Asia trading, with global benchmark Brent crude futures for September delivery easing to $76.3 per barrel while U.S. West Texas Intermediate crude futures at $71.87.

NATO had a fractious summit in Turkey this week, with U.S. President Donald Trump threatening to sever trade with one ally and annex the territory of another. But the alliance’s boss was full of praise for the man he called “dear Donald.”

NATO Secretary-General Mark Rutte thanked Trump, describing his push to get NATO nations to increase defense spending as a “staggering” achievement and a “huge win” for the military alliance.

Rutte’s approach of using flattery to win over the president prompted some to question whether this had delivered any tangible benefits for the alliance.

Over the course of two days in Ankara, Trump threatened to sever trade ties with NATO member Spain over defense spending, said he was very disappointed with NATO’s response to the U.S. war with Iran and reignited his feud with Denmark, another member of the alliance, over Greenland.

But for Rutte, Trump had only praise, describing him as a “great leader” and the alliance’s “biggest asset.”

Sat beside one another during a bilateral meeting on Wednesday, Rutte lauded “dear Donald” for getting Canada and European nations to spend an additional $1.2 trillion on defense during his two terms in office, saying he called this the “Trump trillion.”

Rutte used this term during a visit to the Oval Office late last month, where he presented Trump with charts that detailed increased spending by NATO nations.

NATO’s chief also interjected on Wednesday when Trump sharply criticized former U.S. presidents for failing to get the rest of NATO to ramp up their defense spending commitments: “But you did what Eisenhower started trying to do. … And all the other presidents, none of them were successful. You were the first one. It’s your win.”

Trump replied: “That’s why I like him.”

The back-and-forth was a continuation of the approach Rutte, a seasoned diplomat known as a consensus builder during his nearly 14 years as Dutch prime minister, has taken since becoming NATO chief in late 2024.

Marion Messmer, program director for international security at Chatham House, told CNBC that her takeaway from the Ankara summit was that there is no one person who can manage Trump over the long term, and Europe is better off focusing on strengthening its own security instead.

“While Rutte manages to remain in Trump’s good books with his mix of flattery and submissiveness, other NATO leaders are increasingly irritated with what they perceive to be tasteless behaviour,” Messmer said via email.

In part, Messmer said that this is because Rutte hasn’t managed to transform his personal relationship with Trump into a benefit for NATO, as the U.S. president remains obviously dissatisfied with the military alliance.

“There is a concern that Rutte’s approach to managing Trump does not help the alliance as a whole and might send the wrong message to Russia, that European states feel weak without the US and are willing to bind the US to Europe no matter what,” she added.

In contrast to NATO’s Rutte, Denmark’s prime minister, Mette Frederiksen, struck a defiant tone following Trump’s latest push for U.S. control of Greenland, a self-governing Danish territory.

Asked by CNBC’s Steve Sedgwick whether Denmark would be prepared to defend Greenland militarily in the event of an attack, Frederiksen replied: “We are ready to defend every inch of NATO, including our own territory.”

A day earlier, Finnish President Alexander Stubb had sought to defuse any tensions regarding Trump’s Greenland comments. Speaking to CNBC, Stubb said: “Be more Arctic, be more cool. If it is about Arctic security, we have seven countries that are Arctic nations in the alliance.”

He added: “Finland has trained 1 million soldiers in Arctic conditions; we basically live in Arctic conditions. Let’s keep that in mind. Let’s, you know, continue the process that the Danes, the Americans and the Greenlanders have.”

Rutte and Trump’s “bromance” was a topic of conversation during last year’s NATO summit in the Netherlands, when the alliance made history by announcing a defense spending hike to 5% of individual members’ gross domestic products by 2035.

At that time, journalists questioned Rutte’s approach and particularly his description of the U.S. president as “Daddy,” something Rutte later described as “a question of taste.”

A year on in Ankara, a reporter asked NATO’s secretary-general about his “self-respect” during a news conference, who suggested he had failed to come to the defense of NATO nations threatened by Trump during the summit.

Rutte said that he was keen to “acknowledge when praise is due, and I think we should praise Donald Trump for the fact that NATO is so much stronger.” He added that Europe’s increased defense spending made the Continent “more relevant” to the U.S. as a strategic partner.

Not everyone was critical of Rutte’s approach to managing Trump at the summit, however.

“Mark Rutte is secretary-general of NATO, not secretary general of the European Union, not the president of the Commission, his only job is to keep [the] alliance running,” Latvian President Edgars Rinkēvičs told CNBC’s Steve Sedgwick on Wednesday.

“His only job is to [keep the] trans-Atlantic relationship intact. His only job is to do whatever it takes to have this alliance working, and he does [a] great job,” he added.

South Korea’s stock benchmark, Kospi, has gone from being the world’s hottest equity market to entering bear territory within a few weeks, highlighting how investors have soured on artificial intelligence plays and underscoring concentration risks.

The Kospi fell more than 5% on Wednesday, which brought it 20% below its June 19 record high, according to LSEG data. It closed slightly higher on Thursday in choppy trading.

“South Korea’s recent drawdown has been driven by heightened AI skepticism on the part of global investors, coupled with extreme market concentration,” said Manishi Raychaudhuri, CEO of Emmer Capital. 

The speed of the reversal brings to light a central feature of this year’s rally: South Korea’s outsized dependence on the AI trade. Chipmakers Samsung Electronics and SK Hynix accounted for more than half of the Kospi’s weighting as of June, data provided by Emmer Capital showed. That extreme reliance has both lifted and sunk the index.

“The correction has been driven more by positioning than by a deterioration in fundamentals,” said Jung In Yun, founder of Fibonacci Asset Management Global. Korean equities had become “one of the most crowded AI trades globally after a very strong rally, so it did not take much to trigger profit taking,” he added.

Rising global uncertainty and concerns that earnings upgrades could moderate have also made investors more cautious, although he described the drop in Kospi as “a healthy reset rather than a fundamental change in the outlook.” 

Peter Kim, global investment strategist at KB Financial Group, argued that the move also reflects a broader shift in how modern markets behave.

“The gamification of finance has led to such gyrations driven less by fundamentals but by news flows and fads,” he said, adding that retail fund flows, leveraged exchange-traded funds and AI-driven concentration have made swings of 5% to 10% increasingly common. The Kospi volatility index has surged over 200% since the start of the year.

Kospi has been hammered lately despite strong earnings from the companies at the center of the sell-off. Samsung on Tuesday reported blockbuster profit, while memory pricing continues to strengthen. The chip giant’s shares, however, tanked on concerns about AI spending.

“The market is questioning the pace of earnings growth rather than the sustainability of AI demand itself,” Fibonacci’s Jung said. “This distinction is important because it suggests we are seeing a valuation adjustment rather than the end of the AI cycle.” 

Underscoring strong demand, Rolf Bulk, head of semiconductors and infrastructure at Futurum Group said that memory prices rose between 50% and 80% sequentially in the second quarter, with further increases expected later this year.

Fundamentals for memory makers remain intact, Bulk added, citing a multi-year supply shortage and long-term contracts with hyperscale customers. KB Financial Group’s Kim echoed that “fundamentals and visibility of earnings makes the current correction an opportunity for those who can withstand the short-term volatility.” 

The Kospi is still up more than 70% this year, having gained over 75% last year.

“While volatility may persist in the near term, I believe the medium-term outlook remains constructive,” said Fibonacci’s Jung. “Once global risk sentiment stabilizes, foreign investors are likely to revisit Korea given its central role in the global AI supply chain.”

The timing of any sustained recovery in South Korea’s stock market, however, remains difficult to predict and will depend in part on broader global market conditions, experts said.

The U.S. listing of SK Hynix on Friday could provide a near-term boost for memory stocks, according to Bulk. Constructive management commentary on the durability of the memory cycle through the second half of 2026 could help lift both chipmakers and the broader Kospi, he added.

“2Q26 earnings disclosures from SK Hynix and Samsung Electronics later this month can be a further positive driver: constructive commentary from both companies on the sustainability of the cycle in the second half of 2026 could support the stocks and the broader Korean market.”

Hello, this is Priyanka Salve, writing to you from Singapore.

Welcome to the latest edition of  “Inside India“ — your one-stop destination for stories and developments from the world’s fastest-growing large economy.

India, one of the world’s most prolific IPO markets, was gearing up for issues worth $50 billion as tension in the Middle East were subsiding. But U.S. President Donald Trump’s decision to end the ceasefire with Iran on Wednesday poses a major risk to the multiple large IPOs lined up in India.

Any thoughts on today’s newsletter? Share them with the team.

After a slow start in 2026, India, one of the world’s busiest markets for public listings, was gearing up for a deluge of stock market offerings worth $50 billion. Plans for multiple large IPOs were announced last month after tensions in the Middle East simmered down.

But U.S. President Donald Trump’s decision on Wednesday to end the ceasefire with Iran has put these listing plans at risk. Indian markets slumped more than 2%, reacting to Trump’s announcement, underscoring the growing significance of geopolitical risks in global financial markets.

The relative lack of artificial intelligence-related stocks in India combined with the macroeconomic stress due to the Middle East conflict has already led to a muted performance of Indian equities this year.

“IPO activity could accelerate in the second half of the year if secondary market conditions improve,” Hari Shyamsunder, vice president and senior institutional portfolio manager of India Equities at Templeton Global Investments, told CNBC.

IPO issuances would be driven by the “market’s ability to absorb new offerings,” he added. 

IPO activity in India so far in 2026 has lacked the enthusiasm seen in other major markets like the U.S. and Hong Kong.

Companies in the U.S. have already raised $128 billion by June across 72 initial public offerings, while those in Hong Kong saw 84 listings raise $27 billion, according to an EY report released on Tuesday.

In sharp contrast, IPOs in India have raked in just $4 billion in proceeds through 102 issues, many of which are not listed on the main stock exchange but rather the one for small-and-medium-sized companies. During the first six months, just 31 companies listed on the main exchange, raising just 244 billion rupees ($2.6 billion), according to Mumbai-based IPO intelligence firm Prime Database.

This had been set to change.

Abhay Laijawala, chief investment officer for India at global investment firm Lighthouse Canton told CNBC’s Inside India on Monday that a pipeline of $50 billion worth of IPOs had been expected to hit the Indian markets, leading to a “deluge” of issues.

But the ongoing U.S.-Iran conflict could upend those plans. Experts told CNBC that investors need a fair degree of predictability while pricing IPOs and certainty that a listing will yield decent returns. But persistent geopolitical uncertainty and volatility make that process more unpredictable.

“The Strait of Hormuz being choked did not just choke oil; it strangulated the Indian IPO market,” Laijawala said.

According to Prime Database, roughly $22 billion worth of IPO issues are in the process of seeking regulatory approval, which could take 2-3 months, while $29 billion worth of issues have already been approved.

Among the big companies that have already secured regulatory approval for IPOs are quick commerce firm Zepto and solar photovoltaic manufacturer Avaada Electro. Both issues are estimated to raise around a billion dollars, as per Prime Database.

India’s largest wireless telecom company Jio Platforms and its biggest bourse, the National Stock Exchange, filed for IPO papers last month and are estimated to raise 377 billion rupees ($3.5 billion) and 300 billion rupees ($3.1 billion), respectively, it said. Walmart-owned digital payments company PhonePe is also awaiting approval to start its listing process.

Multiple hospital chains are also part of India’s IPO line-up this year, including Singapore sovereign wealth fund Temasek-backed Manipal Health Enterprises, which plans to raise over a billion dollars.

For the past two years, Indian IPO markets have seen frenzied activity, luring even multinational companies to list their India business units. Carlsberg India filed papers for an IPO last week, while Coca-Cola’s India business unit is also exploring a listing in the country.

The Indian economy is transforming as large parts of it are formalizing on the back of widespread adoption of digital technologies and changes in tax structure.

A government policy push has led to the rise of new manufacturing industries, while funding from private equity firms has led to the rise of consumer tech companies and scaled-up businesses like hospitals and hospitality chains, experts said.

All these businesses are now seeking to list to unlock the next phase of growth.

“Several times in the past, strong IPO pipelines have disappeared, and mega IPOs shelved if market conditions are not supportive,” Pranav Haldea, managing director of Prime Database, told CNBC.

“IPOs need stable, if not buoyant markets to balance the risk of new paper,” he added.

India fashion retailer Trent’s June quarter revenue growth disappoints Street
One of India’s biggest fashion retailers, Trent, reported standalone revenue of 56.66 billion rupees ($595 million) for the quarter ended June, up 19% on year on Monday. The shares of the company tanked over 10% on Tuesday as the revenue growth was lower than expected. Trent operates fast fashion stores primarily in India under the brands Westside and Zudio. 

Meta’s woes deepen in India as child abuse ads on Instagram draw government ire
The Indian has warned of action against two of Meta‘s three major platforms, WhatsApp and Instagram, within a week, underscoring the growing regulatory risks the U.S. social media giant faces in a key market. On Saturday, the government issued a “stern notice to Meta” over the presence of child abuse material in paid. Meta has a “Zero tolerance policy” for child abuse-related content, a spokesperson for Meta told CNBC in an email. 

Coming up

July 10-11: Prime Minister Narendra Modi to visit New Zealand.

July 13: India consumer price inflation data for June.

Singapore state investor Temasek Holdings saw its net portfolio value climb to 518 billion Singapore dollars ($401 billion) for the year ended March 31, a second straight annual record.

Temasek recorded a 10.5% total shareholder return in the financial year, which it said was driven by the strong performance of its Singapore holdings as well as gains from divestments.

The Straits Times Index rose more than 23% from April 2025 to March 2026, powered by the Equity Market Development Programme announced by the country’s monetary authority to unlock greater value in stocks.

Returns would have been better if not for the Iran war that broke out on Feb. 28, which dragged down portfolio value by about 2%. A stronger Singapore dollar also reduced the one-year total shareholder return by about 2 percentage points, Temasek said in a media briefing.

Singaporean companies that the investor holds stakes in include DBS Bank, Southeast Asia’s largest bank, Singapore Airlines, and telecommunications firm Singtel.

Temasek made SG$31 billion of divestments in the period, among them a reported S$8.18 billion stake sale in Schneider Electric India in June 2025.

Five-year total shareholder returns were 4.6%, depressed by headwinds in China’s markets from 2021 to 2024, Temasek said. The firm portfolio exposure to China has been pared down in recent years, from 24% in 2016 to 2026’s figure of 17%.

However, Temasek said it “remains committed” to China, pointing out that in absolute terms, its exposure to the world’s second-largest economy increased by SG$10 billion over the past year.

On a 10-year basis, total shareholder returns stood at 7.1% in Singapore dollar terms.

Temasek said it sees opportunities in three areas: artificial intelligence, private credit, and what it calls “core-plus” infrastructure such as renewable and nuclear energy, energy storage, and decarbonization technologies. This “core-plus” area will be increased to 5% in the next five years, Temasek said.

The firm intends to boost AI-related exposure in its portfolio to 15% by 2031, up from the current 6%.

While current investments include Anthropic and OpenAI in the U.S., Temasek said it intends to deploy capital across areas of the value chain including cloud service providers, foundation models, and AI applications.

“[We] see the rapid advancement of AI as a pivotal phase that will create vast new opportunities.”

Temasek also aims to more than double its portfolio value for private credit to 5% by 2031, from the 2% currently.

The firm intends to focus on senior secured structures that will provide downside protection and strengthen diversification such as corporate lending, asset backed financing and real estate credit.

Temasek Holdings increased its China exposure by 10 billion Singapore dollars ($7.7 billion) last fiscal year — the biggest annual increase in five years, as the state investor repositions its portfolio in the country for a new growth cycle led by artificial intelligence and advanced technology.

“We saw a rebound in China,” Chief Executive Officer Dilhan Pillay said at the firm’s annual review Wednesday, adding that the firm’s China exposure has grown by about SG$24 billion over the past decade.

Temasek’s 5-year total shareholder return stood at 4.6% for the year ended March, weighed down by headwinds from China’s capital markets from 2021 to 2024, it said, adding that its exposure last year grew alongside a rebound in market valuations.

While Temasek’s underlying country exposure to China declined to 17%, from 29% in 2020, it remains the fund’s third-largest market after Singapore at 27% and the Americas at 26% — which rose from 24% a year earlier.

Within China, the firm is rotating away from sectors that characterized earlier phases of its portfolio — consumer and real estate — toward what it called “hard tech,” such as AI-related hardware and infrastructure, robotics, biotech, energy transition.

China “is no longer the high-growth economy — it’s becoming a maturing economy,” said Chia Song Hwee, CEO of Temasek Global Investments. “We need to be selective in when we invest [and] construct a portfolio that is more relevant in this current regime.”

For consumption, Temasek sees opportunities in spending on experiences over goods, and homegrown consumer brands that have proved innovation capabilities, over foreign brands. But recovery in domestic consumption remains “uneven and not yet broad-based,” it said, and additional policy easing remains unlikely.

New investments made during the year included Luckin Coffee and logistics group ANE in China, Anthropic and OpenAI in the U.S. and Ermenegildo Zegna Group in Europe.

Temasek, which had held indirect investment in the coffee chain through private equity firm Centurium Capital, disclosed a 6.4% stake in Luckin in a May regulatory filing.

Once on the brink of collapse after a $300 million fraud scandal that forced it to delist from Nasdaq in 2020, the coffee chain has staged a sharp comeback. In 2022, Luckin announced that it had completed the restructuring of its financial debt and emerged from Chapter 15 bankruptcy proceedings.

Temasek invested in Luckin only after the company’s legal and governance issues were resolved, Chia said, brushing off questions about a relisting, saying Luckin’s priority should be building a durable business first.

“We decided to invest because we believe that the shareholder and management team has been doing the right thing and on the right trajectory, so it was only then that we invested,” Chia said.

Temasek was also part of a consortium with Centurium Capital and True Light Capital, a private equity firm under Temasek, that took ANE private in February.

The state investor’s net portfolio value surged to a record SG$518 billion ($401 billion) for the year ended March 31 from SG$49 billion, marking its third straight annual increase.

Oil prices rose Tuesday after Iran attacked a tanker from Qatar near the strategically vital Strait of Hormuz.

The attack near the waterway, which typically handles around 20% of the world’s oil traffic, reaffirm the fragility of the U.S. and Iran’s interim peace agreement, as they negotiate a permanent end to their war.

Brent crude futures, the international benchmark, settled 3% higher at $74.16 per barrel. U.S. West Texas Intermediate futures advanced 2.8% to $70.44.

Iran attacked the Qatari liquefied natural gas tanker Al-Rekayyat while it was transiting near the Strait of Hormuz, said Dr. Majed al Ansari, the spokesperson for Qatar’s Ministry of Foreign Affairs.

“We demand that the Islamic Republic of Iran immediately cease all practices that undermine regional security or threaten the safety of international maritime navigation,” al Ansari said in a social media post. “We hold it fully legally responsible for this attack & for any resulting damages & consequences.”

Qatar’s confirmation of the attack comes after the United Kingdom Maritime Trade Operations Centre reported Monday that a tanker was struck by an unknown projectile about 8 nautical miles east of Limah, Oman. The UKMTO is a maritime security alert service.

Another tanker transiting Hormuz on Tuesday was apparently hit by an unidentified projectile and is believed to have suffered structural damage, the UKMTO said in another incident report.

Washington and Tehran signed a memorandum of understanding last month to bring their nearly four-month war to an end.

Prices, however, extended gains after hours after the U.S. revoked Iran’s license to sell its oil. “As President Trump and the administration have repeatedly affirmed, the MOU in effect with Iran is entirely performance-based,” a U.S. official said to CNBC.

Brent popped 5.6% to $76.04 in after hours trading, while WTI jumped 5.4% to $72.25.

“The situation around the Strait of Hormuz remains unsettled. But as we have argued since March, both sides should ultimately have an interest in containing the conflict,” Holger Schmieding, chief economist at Berenberg, said in a research note published Friday.

“Ahead of the mid-term elections to Congress on 3 November, US President Donald Trump wants low oil prices whereas the Revolutionary Guards in Tehran covet the money from potential sanctions relief,” they added.

Correction: This story has been revised to reflect that Brent crude futures settled at $74.16 per barrel. A previous version mischaracterized the price.

Ukrainian drones struck a major oil refinery in the city of Omsk in western Siberia, in what appears to be one of Kyiv’s deepest attacks on Russian territory since the full-scale invasion of Ukraine.

Ukraine’s military general staff said Monday that the strike caused a fire at the facility, which is situated nearly 2,500 kilometers (1,553 miles) from Ukrainian territory and close to Russia’s border with Kazakhstan.

The attack, which was confirmed by local Russian officials, provides further evidence of Kyiv’s enhanced long-range drone capabilities and comes on the eve of a crunch NATO summit. Heads of state from 32 countries are expected in Turkey’s capital from Tuesday for the two-day conference.

“Today, our long-range sanctions reached the oil refinery in Omsk – nearly 2,500 kilometres from Ukraine,” Ukrainian President Volodymyr Zelenskyy said in his daily evening address, according to a translation.

“Upgraded Fire Point drones have put Siberia within reach of Ukrainian precision. This is a significant blow to Russia’s oil economy and an important achievement for the Armed Forces of Ukraine,” Zelenskyy said.

Based in Kyiv, Fire Point is a leading Ukrainian defense-technology company that specializes in drone and missile systems for modern precision warfare.

The Omsk oil refinery represents the largest of Russia’s 11 gasoline producers to be hit by Ukrainian forces, Ukraine’s military said.

The facility is estimated to have a refining capacity of more than 21 million metric tons of crude oil per year and specializes in the production of a range of fuels, lubricants and petrochemical products.

Omsk regional governor Vitaly Khotsenko said via Telegram on Monday that emergency services were working at the scene following a Ukrainian attack at the facility. No casualties were reported from the incident.

Ukraine has stepped up its attacks on Russian oil facilities in recent months, seeking to deplete President Vladimir Putin‘s war chest as the Kremlin’s more than four-year war drags on.

Ukraine’s president said Monday that the country’s armed forces had also been able to strike Russian oil facilities in the Yaroslavl region, as well as other areas of its neighboring country.

Russia had launched a barrage of missiles and drones against Kyiv in the early hours of Monday, killing at least 19 people, authorities said. The attack followed a separate deadly assault on Ukraine’s capital last week.

U.S. President Donald Trump held separate calls with Russia’s Putin and Ukraine’s Zelenskyy over the weekend and said Monday that a resolution to the conflict is “getting closer than people realize.”

Trump is expected to hold talks with Zelenskyy on the sidelines of the NATO summit in Ankara.

Iran’s push for control over the Strait of Hormuz has prompted some energy market participants to worry about the introduction of tolls on the Strait of Malacca, one of the world’s most important energy and trade choke points.

It follows reports that Iran and Oman, which sit on opposite sides of the Strait of Hormuz, have presented the U.S. with a proposal to jointly administer the narrow maritime corridor, including the collection of administrative fees.

The U.S. and Iran agreed in a memorandum of understanding last month that ships could safely and freely navigate the waterway for 60 days. The Strait of Hormuz typically handles around 20% of the world’s oil traffic.

Thereafter, the future administration and maritime services of the strait will be defined by Iran and Oman after talks with other Persian Gulf states, “in line with the applicable international law and the sovereign rights of coastal states of the Strait of Hormuz.”

The notion of some sort of service plan to transit the Strait of Hormuz has sparked alarm across the globe, not least by investors who fear it could be replicated in other strategically vital maritime corridors.

Maritime experts, however, have said they remain deeply skeptical about the prospect of fees being introduced in the Strait of Malacca.

Janiv Shah, vice president of commodity markets at Rystad Energy, said some investors were starting to get “a little bit jittery” about the prospect of an oil shock in the form of tolls in the Strait of Malacca.

“I think part of the reason here is, if we see a potential toll booth with Iran, sort of, enacting upon the Strait of Hormuz, that something similar could be enacted on others, and of course, the most important from a volume metric perspective is … the Strait of Malacca,” Shah told CNBC’s “Squawk Box Europe” on Monday.

“The way that it will be enacted, of course, I’m unfortunately unable to share a little bit more on that, but it probably will take a lot of time because it is, from a volume metric perspective, significant,” he added.

The Strait of Malacca, which is the primary choke point in Asia and Oceania, accounted for 29% of total maritime oil flows in the first half of 2025, according to the U.S. Energy Information Administration.

Crude oil is estimated to make up just over 70% of total oil flows through the waterway each year, with petroleum products accounting for the remainder.

Spanning about 900 kilometers, the waterway provides the shortest sea route from East Asia to the Middle East and Europe. It is bounded by Indonesia, Thailand, Malaysia and Singapore.

In April, Indonesia’s Finance Minister Purbaya Yudhi Sadewa suggested the country could introduce tolls on ships using the Strait of Malacca, before walking back the idea. Indonesia’s coastline forms the entire southern edge of the Strait of Malacca.

The establishment of a tolling system would be illegal under international law, which guarantees free passage through straits used for international navigation.

Indonesia President Prabowo Subianto and Singapore Prime Minister Lawrence Wong both reaffirmed their commitment to the unimpeded passage of vessels through the strait shortly after a meeting in Indonesia’s capital on Monday.

Hunter Marston, director of the Southeast Asia program at the Sydney-based Lowy Institute, said in a note published June 23 that while the Malacca Strait “easily” meets the definition of a choke point, it is not a flashpoint.

“Institutions matter,” Marston said, pointing out that the Malacca Straits Patrol (MSP) ensures the waterway remains open to global trade. The MSP is jointly managed by four states: Indonesia, Malaysia, Singapore and Thailand.

“The arrangement benefits all parties as well as the global economy. Without this institution, the Malacca Strait would be just as vulnerable to capricious closure as the Strait of Hormuz,” he added.

Analysts at the Center for Strategic International Studies (CSIS), a Washington-based think tank, said Iran’s actions regarding the Strait of Hormuz had showcased that controlling a maritime choke point could “significantly augment” a country’s power and deterrence.

The stakes are “even higher” in the South China Sea, analysts at CSIS said, particularly given the existence of two strategically important waterways that connect many of the world’s major economic centers: namely, the Strait of Malacca and the Taiwan Strait.

“Iran’s efforts to control and toll traffic through the Strait of Hormuz have renewed fears that states could try to do the same to the Malacca Strait. China’s threats to use force against Taiwan have also put the Taiwan Strait at the epicenter of one of the world’s most high-stakes geopolitical hotspots,” analysts at CSIS said in an analysis published July 1.

“If either of these two major straits is interrupted, rerouting options exist, but they will come at a cost,” they added.

Toyota Motor on Monday announced that it is investing $3.6 billion to move production of the Tacoma midsize pickup truck from a plant in Mexico to its San Antonio, Texas, manufacturing campus.

The investment is expected to create 2,000 U.S. jobs at the facility, add a second vehicle assembly line and roughly double the size of the 2.7-million-square-foot plant by 2030, the automaker said. It will expand the plant’s annual capacity from roughly 200,000 to 350,000 units, Toyota said.

The announcement is part of Toyota’s stated plans to invest up to $10 billion more than previously expected domestically in the U.S. through 2030. It comes less than a week after the Trump administration confirmed it would not extend its trilateral trade pact with Canada and Mexico, instead opting to conduct annual reviews.

A Toyota spokeswoman said the company is “maintaining its operations in Mexico” as Tacoma production transfers from Tijuana to Texas over the next four years, but she declined to share additional details. The company plans to continue to produce Tacoma pickups at another Mexican plant in Guanajuato, she said.

“This investment expands Toyota’s manufacturing capacity and complements our broader North American production network,” she said in an email to CNBC.

The move comes more than six years after Toyota confirmed it would shift Tacoma production from the Texas plant to the Toyota Motor Manufacturing de Guanajuato plant in Mexico.

The Texas plant currently produces the Toyota Tundra full-size pickup truck, including a hybrid variant, and the Toyota Sequoia SUV hybrid. Toyota previously announced it was investing $531 million in a 500-million-square-foot rear axle plant on the campus that is slated to begin production in the fall.

Potential plans to expand the San Antonio plant, codenamed Project Orca, were first reported in May by Automotive News.

“Toyota’s continued investment in North America is a testament to our confidence in the region’s workforce, innovation and long-term growth potential,” Toyota Motor North America CEO Ted Ogawa said in a release. “By expanding our San Antonio plant, we are deepening our commitment to American manufacturing, creating meaningful and sustainable jobs, while advancing our mission to deliver high-quality vehicles that meet the changing needs of customers today and into the future.”

Toyota, which employs 48,000 people in the U.S., says it has invested $8.3 billion in the San Antonio plant since its groundbreaking in 2003.

The increased investment and production capacity could assist Toyota — the world’s largest automaker — in becoming the No. 1 carmaker in U.S. sales.

Toyota is forecast to narrow the gap in U.S. sales with America’s largest automaker, General Motors, this year as hybrids get more popular and all-electric vehicles sputter, according to Cox Automotive.

The Japanese automaker’s sales were up 0.5% through the first half of the year compared with 2025, to 1.24 million. GM, meanwhile, reported a 6.8% decline during that time, to 1.34 million vehicles sold.

Toyota’s gains come as the automaker has rolled out new models, including all-electric vehicles, while continuing to double down on its hybrid vehicles, where it’s been a leader for decades.

GM, meanwhile, heavily invested in all-electric vehicles instead of hybrids, many times referring to them as a transitional technology. The Detroit automaker’s sole hybrid is a Corvette, while it offers a full lineup of EVs for luxury brand Cadillac as well as many models for other brands.