As Netanyahu vows Iran payback, markets watch for dangers of further escalation
Israel’s Iron Dome anti-missile system intercepts rockets, as seen from Ashkelon, Israel, October 1, 2024
Amir Cohen | Reuters
Israel’s government has vowed a severe response to Iran’s unprecedented missile barrage into Tel Aviv, leaving the Middle East on edge as fears rise over a possible all-out war between the two long-time foes.
On Tuesday evening, Iran launched roughly 180 ballistic missiles at several sites across Israel, an attack Tehran said came in response to the Israeli assassination of Hezbollah chief Hassan Nasrallah the week prior.
Israeli authorities say there were no casualties as a result of the offensive, and that most of the strikes were intercepted. But the event marked a turning point in a series of escalatory tit-for-tat moves, as Tehran appeared adamant to re-set deterrence and prove to Israel that it could — and would — attack at a time of its choosing.
Markets are now braced for what could follow a likely Israeli retaliation against Iran. Defense stocks are rallying — and long-subdued oil prices may also be set for increases, as industry watchers now see a real threat to crude supplies.
As much as 4% of global oil supply is at risk as oil infrastructure in Iran — one of OPEC’s largest crude producers — could become a target for Israel.
Oil prices gained over 5% in the previous session following the missile strike, before tapering to a 2.5% climb. The December delivery contract of global benchmark Brent was trading at $75.37 per barrel at 10:30 a.m. in London, while front-month November U.S. West Texas Intermediate futures were up 2.68% to $71.70 per barrel.
“I think this focus might be on Israel, but the focus should really be on Iran, and whether there will be attacks on regional infrastructure. That really is the one event that we are looking for, and which could determine a more dangerous path for stock markets, for risk assets in general,” Frederique Carrier, head of investment strategy for the British Isles and Asia at RBC Wealth Management, told CNBC’s Capital Connection on Wednesday.
“We know, looking at the acts of war since the 1940s, that those which create an oil crisis [and] a prolonged increase in oil prices are the ones which have a long-lasting impact on stock markets.”
She added that so far, there is “no indication” of that.
Oil infrastructure ‘tempting targets for Israel’
Lewis Sage-Passant, an adjunct professor of intelligence at Sciences Po in Paris, described energy markets as jittery, as investors watch for Israel’s next moves.
“Iran depends on a handful of ‘chokepoint’ export terminals, such as Khark island, which will be tempting targets for Israel,” Sage-Passant said. “Energy sector teams seem nervous about an escalating tit-for-tat of strikes against regional infrastructure. Even without direct targeting, much of the world’s oil infrastructure sits under these missile’s flight paths, so naturally everyone is very nervous.”
Following the Tuesday attack, U.S. National Security Advisor Jake Sullivan warned of severe consequences for Iran, saying that the U.S. would staunchly support Israel. But Washington’s efforts to de-escalate and prevent a region-wide conflict have clearly failed, according to Roger Zakheim, a former U.S. deputy assistant defense secretary and director of the Ronald Reagan Institute in Washington.
Iran’s attack and the subsequent Israeli response “may result in impact on oil, energy markets, certainly aviation, and I think certainly the defense sector … Investments in missile defense and ammunition, those companies that manufacture and produce those systems, for sure are going to be impacted by what’s playing out in the Middle East,” he said.
Immediately following the Iranian strikes, U.S. defense stocks hit record highs. Their European counterparts also ticked higher on Wednesday morning on the rising conflict risks, with Saab and BAE Systems adding 2.2%. Thales and Rheinmetall both rose more than 1.3%.
“Israelis now will respond, not only in kind, but do what is necessary to restore deterrence,” Zakheim added.
Deterrence, or full-blown war?
Questions remain whether a strong Israeli response would restore deterrence or trigger further escalation from Iran and tip the nations into a full-blown war. In a statement following the country’s missile salvos, Iran’s Foreign Minister Abbas Araghchi said: “Our action is concluded unless the Israeli regime decides to invite further retaliation. In that scenario, our response will be stronger and more powerful.”
Aside from geographical choke points in the oil market, “there are plenty of facilities on [the] Iranian side and also [on the ] Israeli side that could all be targeted in terms of critical infrastructure,” Sara Vakhshouri, founder and president at SVB Energy, told CNBC’s Capital Connection on Wednesday.
“That infrastructure is all connected,” she said, stressing that the sheer size of Iran means “it is impossible to somehow secure all of it.”
Some market watchers are warning oil could hit $100 per barrel.
Vakhshouri expressed doubts over such a forecast, noting that geopolitical events often only affect oil prices temporarily. The extent and duration of any market impact “depends on where the destruction would be and how much oil is going to be taken off the market,” she said.
“Definitely, prices will have an upward trend. [But] the other thing is that the market is focusing on huge uncertainty on both sides … [whether] it’s the demand side or the geopolitical side.”
A longer-term issue underpinning oil prices is the broader global demand picture. Brent crude hit a 33-month low in mid-September and had hovered around $70 per barrel until Iran’s missile attack on Israel, based on slowing global demand and abundant supply, particularly from non-OPEC+ producers.
“So it’s very interesting moment now,” Vakhshouri said. “We have the prices being resilient due to the fear of low demand in the market, but also the geopolitical factor is real. Any side could really push the market, and we have seen just in the past few days, how the prices go up and down, depending on how the sentiments are triggered in the market.”
While other semi truck brands hide delays and missed deadlines behind press releases and fake updates, Volvo Trucks is busy cementing its position as the heavy-duty EV leader, thanks to great market share and a certified dealer network that’s seen 8,200% growth this decade.
Beginning with TEC Equipment in Fontana as the company’s only certified EV dealer in July 2021, Volvo Trucks’ BEV sales network has expanded quickly to 83 certified locations across 33 US states and four Canadian provinces, with four new dealer groups recently joining the program and another 13 rooftops currently in the certification pipeline. Those dealers have helped Volvo Trucks gain a leading position globally and maintain more than 30% market share in the North American electric truck segment over the past five years.
“Reaching this milestone is a testament to our customers’ commitment to sustainable transportation and our dealer network’s dedication to supporting them every step of the way,” explains Peter Voorhoeve, president, Volvo Trucks North America. “The path to zero emissions is shaped by market conditions, which are moving slowly. We remain committed to our vision to create a world we want to live in by using zero emissions solutions in combination with fuel efficient combustion engines with reduced climate impact. Solutions that will work for our clients where sustainability meets affordability.”
So far, those dealers have deployed over 700 battery electric semi trucks (out of 5,700 globally) that have logged more than 20 million zero-emission miles and eliminated an estimated 34,000 metric tons of CO2 – the equivalent of over 7,000 passenger cars.
Electrek’s Take
I’m struggling to reconcile Volvo’s true net zero rhetoric and seemingly dedicated push towards progressive and sustainable business practices with the US branch’s recent attempts to weasel out of their deal with California and, more specifically, CARB. Volvo is a leader in this space, and they should also lead by example where it matters.
SOURCE | IMAGES: Volvo Trucks.
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ALSO, the electric bike spin-off from EV-maker Rivian, just dropped some welcome news: a more affordable version of the bike is coming. Officially called the TM-B, the new model will launch at $3,500, coming in a full $1,000 under the previously announced $4,500 TM-B Performance we saw last month.
While the Performance model leaned heavily into premium components and higher output, the new TM-B appears designed to bring the platform’s eye-catching design to a wider audience.
The TM-B includes much of the same design and basic feature set as the TM-B Performance, though the $1,000 lower price tag does come from the company filet-ing a few corners. The bike drops from the 10x assist of the Performance edition to just 5x assist (presumably meaning half the power, but it’s hard to say since e-bike companies generally don’t list power as a multiple of rider input). It also has a smaller battery, more basic coil spring shock instead of the nicer and lighter air shock, fewer ride modes, and doesn’t come with the same premium styling options.
The bike does retain ALSO’s interesting drive-by-wire solution though, which means that there isn’t a physical connection between the pedals and the bike. Instead, riders turn pedal cranks connected to a generator that converts pedaling energy into electrical energy to feed the rear wheel through a Gates carbon belt drive.
Hydraulic disc brakes along with ABS-braking come standard on both models, and the cockpit includes a compact color display with app connectivity, offering basic ride metrics and configurable assist modes.
ALSO hasn’t committed to an exact delivery date, but reservations are now open.
Electrek’s Take
A $3,500 entry point is undeniably better news for fans of ALSO’s design language who weren’t ready to shell out $4,500. However, I still seem to be one of the few in the industry who are hesitant to believe there is a path to profitability here. Americans don’t buy $4,500 e-bikes, at least not in high volume, and they don’t really buy $3,500 e-bikes, either.
It’s not that the bike isn’t worth it – ALSO’s engineers should be commended for stuffing a crazy amount of tech and innovation into this bike. But it simply won’t matter when the bike doesn’t sell very many units and ALSO has to keep making payroll on its huge workforce comprised of many expensive engineers and other tech roles. It’s very close to the same playbook that we watched sink other tech-forward e-bike companies like VanMoof, which went bankrupt after it couldn’t keep up with servicing its expensive and proprietary e-bike tech while trying to float a massive workforce.
Frankly, I’m a bit confused. Most basic e-bike media seems to be going nuts over the thing, and I’m the only one pointing out that the king appears to be walking around naked.
Also, the timing here is… odd.
Good news usually gets announced on a Tuesday morning, not sent to us at 4:56 PM on a Friday, right as everyone logs off and heads into the weekend. The classic “Friday news dump” is where companies hide things they don’t want attention on – not where they brag about slicing $1,000 off the entry price of a new model. A head scratcher all around.
Either way, a lower-priced TM-B is objectively good news. The problem is, it might just be shouting into the wind.
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Founded in 1689, Husqvarna was a musket maker for the king of Sweden – but now, the company best known for quirky motorcycles and commercial riding mowers is becoming an innovator in the field of robotics, and its latest fleet of electric autonomous mowers are eager to get grazing.
Husqvarna’s autonomous lawnmowers made history earlier this year at the AIG Women’s Open, when they became the first autonomous groundskeeping solution to see duty during a UK Major golf week.
“At the AIG Women’s Open, the Husqvarna portfolio is helping us deliver this goal through improved resource management, regular lightweight mowing and reduced carbon usage,” explains Royal Porthcawl’s Course Manager, Ian Kinley, who has championed the use of robotic technology at the course. “With the AIG Women’s Open set to be the largest-ever women’s sporting event in Wales, we know there’s tremendous pressure to produce playing surfaces that are worthy of such a high-profile event.”
The robots themselves operate a bit differently than Husqvarna’s traditional line of big, bad, zero-turn riding mowers that whip through thick grass once or twice a month with heavy, whirling blades. Instead, they employ a series of tiny razor blades that gently nibble at the grass daily – just like little electric sheep grazing on the turf.
“That cutting system, developed by Husqvarna engineers, has then become the basis for the entire robot mower industry, of which we’re the market leader,” Nick Rawson, VP of Strategy and Business Development at Husqvarna told Forbes.
Events like the AIG Women’s Open are proving that the little robot Huskies can get the job done quietly, sustainably, and with significantly less operator input. As such, you’d think everyone at Husqvarna would be excited about them.
You’d be wrong. The company’s franchise dealers have been hesitant to push them forward, effectively putting the parent company in the position of going B2C, or going home.
“Dealers live and breathe the previous technology,” said Yvette Henshall-Bell, Husqvarna’s President of its Forest and Garden division for Europe, in that same Forbes piece. “They want to protect that servicing, that aftermarket revenue. Whereas if they really thought about what the customer’s problems are and the job to be done, they would be looking at a completely different solution.”
A solution, frankly, that looks a lot like a little robot mower.
The things, themselves
Husqvarna offers three types of autonomous electric mowers aimed at commercial golf courses, but the Husqvarna CEORA for large-area mowing, and Husqvarna Automower, for smaller, steeper and more complex areas, are the models relevant to this story.
The bigger CEORA can handle up to 18 acres of ground twice each week, while the Automower, with its 80V battery and pinpoint precision EPOS (Exact Positioning Operating System) software, can handle another 2.5 acres. Both are fully electric, and can guide themselves back to their pens to recharge as needed.
Prices aren’t public, but the Husqvarna CEORA and Automowers are available as part of a custom lease package through Husqvarna Finance that will include access to the company’s customizable back end and ongoing support. Check with your local dealer for more.
Electrek’s Take
As a typically pro-union, pro-labor type of guy, I am hesitant to heap praise upon a robot taking away anyone’s job. That said, it does seem to be difficult for landscapers and construction crews to keep and find good labor at rates they can afford (and, let’s face it – the current Trump Administration isn’t going to be making that any easier). As such, if companies like Husqvarna and John Deere and Einride and others can build a demonstrably better mousetrap at a compelling price point … good for them. (?)
Let us know what you think in the comments.
SOURCES: Forbes, Golf Monthly; images by Husqvarna.
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