U.S. Strikes Iran to Block New Sea Mines in Strait of Hormuz

The US strikes Ronnie in targets near the Strait of Hormuz, sending oil prices higher on concerns of a flare-up in fighting, plus President Trump's China tariffs propelled V&M as manufacturers shift production. These countries were at war 51 years ago, and didn't even have normal relations until the Clinton administration lifted a trade embargo, so they've gone from having no trade to having the biggest trade surplus with the US in just a generation. And NASA sends its next-gen telescope into orbit. It's Monday, August 31st. I'm Luke Vargas for the Wall Street Journal, and here is the AM edition of What's News, the top headlines and business stories moving our world today. Oil prices are rising this morning, with Brent Crude Futures trading above $90 a barrel after fresh fighting yesterday between the US and Iran. According to US Central Command, American forces attacked a pair of Iranian rocket launchers on an island in the Strait of Hormuz, saying they had been preparing to fire rockets filled with sea mines into the waterway. The US, last week, said it had finished clearing mines from the strait. Shortly after the strike, US forces defended against missiles launched at Jordan, which hosts nearly 4,000 American troops. All the conflict in the Middle East, along with the war in Ukraine, has led to a divergence in fortunes for two of the world's great powers, which will be on full display later today. Russian President Vladimir Putin is due to meet with Chinese leader Xi Jinping at a time when Moscow is increasingly dependent on Chinese imports and Beijing buying its oil. Thomas Grove is a journal's Russia bureau chief. What we've seen over the last several years, particularly is Russia's increasing reliance on China as an economic partner, has made it almost hostage in some ways, particularly when it comes to its domestic market. And so, as time progresses, you see a weakening of the Russian economy and a kind of stagnation, whereas China's role is just getting stronger and stronger, both globally, but I think also within the relationship as well. Thomas says Beijing could use that upper hand to push Moscow to the negotiating table with Ukraine or even prevent a Russian attack on NATO. The status quo really suits China so well because it keeps Russia and the Russian economy relatively hostage to China. So I think they would be happy to see things stay as they are and just watch the Russian economy bleed, so to speak. What I think they don't want, though, is any kind of escalation within Ukraine, perhaps, but I think the red line is when you start getting into Europe and NATO. But while the two powers want different outcomes from the Ukraine war, Thomas says their interests converge on Iran. Russia wants to keep Iran afloat by all means it's providing drone technology to Iran. Intelligence, as we reported out, to Iran as well, China has also supported Iran in various ways. And I think this is one focal point for both of them in terms of trying to undermine this kind of Western global order. Well, another potential threat to the global order and the financial system in particular is AI. G20 finance officials meeting today in Asheville, North Carolina are sent to receive that warning from none other than Andrew Bailey, the head of the Bank of England and the G20's financial stability board as our Paul Hannon explains. His job is to make sure or try to make sure that all the regulators are working together to preserve the stability of the global financial system, you know, that they're making sure that their financial institutions do not act as a weak link in a global effort to allow this technology to be developed for good without doing really severe harm. You know, we've seen some recent instances in which they've escaped sandboxes and decided to hack into the systems of other institutions. And that sort of thing really worries financial regulators. Paul Hannon is the economics editor for Dow Jones Newswires. Now, to a few economic updates from China, where the country's three largest state-owned airlines are feeling the pinch as the result of a weak domestic market and high fuel costs. Aircraft fuel for Air China, China Southern, and China Eastern Airlines rose between 35 and 38 percent over the first half of 2026 compared to last year, meanwhile, competition from high-speed rail has weighed on China's domestic aviation industry in recent years, leading the three carriers to shift more capacity to international routes. Well, some similar themes were present in EV Maker BYD's latest earnings, as strong growth in Europe and Latin America helped to overcome soft domestic sales. For the first time, more than half of BYD's revenue now comes from overseas. And Chinese manufacturing activity rebounded more than expected in August, and now sits just shy of a threshold signaling expansion. High tech and equipment manufacturing are leading the way, while heavy and raw material industries still face headwinds, in a bid to address persistently sluggish economic demand Beijing last week introduced rules to lower credit barriers for home buyers and property developers, leading some economists to forecast an improvement in conditions over the rest of the year. Coming up the EU suffers a reputational blow, as Icelanders vote against restarting talks to join the bloc, and in President Trump's new global trade order, one country is coming out on top. We'll look at who after the break. Voters in Iceland over the weekend rejected restarting talks to join the European Union. Iceland's debate on EU membership shifted over the past year after US tariffs sparked a breakdown in global trading norms, and President Trump ramped up efforts to acquire Greenland. Although Iceland has adopted many of the EU's rules, as a member of the European economic area, General reporter Kim McCraill, says that the island has long been wary of seeding more power to Brussels. Greenland is Iceland's closest geographic neighbor, and for some Icelanders, Trump's comments about Greenland were enough to make them wonder about their own security. It's important here to be aware of two particular facts. Iceland doesn't have a military, and its population is only 400,000. A lot of people who were voting no for holding talks with EU said they already felt protected by the fact that Iceland is a member of NATO, and they also have a defense agreement with the US. The no vote is a bit of a blow for the EU's reputation, and that's because it had tried to position itself as a counterweight to Trump. Iceland's government said it would respect the outcome of the vote, and that it would continue to cooperate with the EU. While a little over a year into President Trump's push to rewire global trade in America's favour, Vietnam is emerging as a major winner. New federal data shows that over the first half of this year, Vietnam achieved a $114 billion trade surplus with the US, managing to top China, Mexico, and even semiconductor hub Taiwan. Over the first six months of this year, US imports from Vietnam increased 40% to 123 billion from the same period in 2025. One big reason is that while President Trump raised tariffs everywhere, he put the highest on China. So if you're say an American furniture maker in China, you're thinking, okay, these tariffs are pretty high. Why not shift my manufacturing across the border to Vietnam, which has a pretty good manufacturing base? That's journal reporter Stu Wu, who since the shift to Vietnam didn't happen overnight. One particular issue is that the White House Trade Advisor Peter Navarro said, "We think Vietnam is a huge hub for illegal transshipment. What does that mean?" Well, that means what if I took a nearly finished piece of clothing from China and I sent it across the border to Vietnam and they just stitched on a new net label and said it's made in Vietnam. He doesn't like that. So the White House is considering cracking down on practices like that. About 60% of Vietnamese exports to the US are labeled as machinery, electronics, or appliances. That are dominated by big companies with Vietnamese operations, including Samsung, Intel, and electronics maker Foxconn. Though the White House is taking issue with some made in Vietnam labels. It's been in the works for almost a decade because in 2018, President Trump put high tariffs on Chinese goods because he thought China had some unfair business practices. So you had some big companies like Nike, Lululemon, and Apple shifter manufacturing from China to Vietnam because wages were a little bit lower but they were really sophisticated in the stuff they were producing. And what happened over the past year is just a continuation of that trend. Well, Vietnam has benefited from a lower tariff rate Trump has said he wants to cut down on the trade deficit to level the playing field for American businesses. And finally, officials at NASA were beaming with excitement yesterday as the agency launched its new flagship telescope aboard a SpaceX rocket in Florida. From its future orbit about a million miles from Earth, the Nancy Grace Roman Space Telescope will have a range of view at least 100 times larger than the Hubble Observatory thanks and part to repurposed spy gear. Senior project scientist Julie McEnnery said the tech will enable the telescope to potentially measure light from a billion galaxies. Roman is going to understand or give us the data that we need to understand the nature of the universe we live in. What we can do is we can make measurements of billions of galaxies. We can precisely measure the shape of hundreds of millions of galaxies. We can precisely measure the position and distance and we can use that to measure how the structure in our own universe has grown over cosmic time. NASA expects the telescope's mission to last at least five years. years at a total expected cost north of $4 billion. And that's it for what's news for this Monday morning. Today's show was produced by Hattie Moyer and Daniel Bach, our supervising producer, is Sandra Killhoff, and I'm Luke Vargas, for the Wall Street Journal. We will be back tonight with a new show, and until then, thanks for listening.