The price of Brent oil soared above $126 a barrel on Wednesday, its highest level since 2022, after Donald Trump warned the US blockade of Iranian ports could last months and peace talks remained stalled.

Surging more than 13% in 24 hours, Brent crude hit a record price since the war began on 28 February. Not since Russia’s 2022 invasion of Ukraine has Brent topped $120, with the price then peaking at $139.

Oil markets have been spooked this week as Trump appeared willing to maintain the US Navy blockade of Iranian ports, with Iran responding by keeping the strait of Hormuz all but shut to other oil tankers.

US-Iran talks set for Islamabad in Pakistan over the weekend failed to materialise, so the stalemate grinds on.

Trump on Wednesday said Iran “better get smart soon” and in a meeting with oil executives discussed what steps could be taken to “continue the current blockade for months if needed,” according to a White House official.

US officials hope the blockade will force Iran to cap its oil wells and shutter production once its oil facilities, such as Kharg Island, have filled to the brim. Analysts are unsure how long that could take.

“The blockade is somewhat more effective than the bombing,” Trump told Axios. “They are choking like a stuffed pig.”

The war is about to enter its 10th week, despite Trump’s initial projections of a 4-6 week conflict before Tehran would buckle. Global oil supplies drop by nearly 20 million barrels every day the strait is choked off.

Oxford Economics warned in a blog post that a six-month impasse in the strait could send oil prices as high as $190 by August.

Jim Reid, a market strategist at Deutsche Bank, said the jump in the oil price was feeding “growing fears about an extended stagflationary shock”, and pushing up the interest rates – or yields – on government bonds.

“Overnight we’ve seen Japan’s 10-year yield move up to 2.51%, which would be its highest closing level since 1997. It was a similar story in Europe too, with the 10-year [German] bund yield at a post-2011 high of 3.11%, whilst 10-year [UK] gilt yields hit a post-2008 high of 5.07%,” Reid added.

The economist Paul Krugman, a former New York Times columnist, said he believed most analysts have been “far too sanguine” about the effects of a prolonged Hormuz crisis.

“In my view, a full-on global recession is more likely than not if the strait remains closed for, say, another three months, which seems all too possible,” he wrote on his Substack on 20 April.

In 2008, during the global financial crisis, oil surged to record highs, with crude briefly hitting about $147. Two weeks after the US and Israel launched their first strikes on Iran, Tehran said the world needed to prepare for $200 barrels of oil.

Beyond ramping up the cost of petrol, the effects of the supply shock have cascaded through the global economy, causing inflation to rise and sparking some fears of a looming global recession.

US inflation soared in March, with prices up 3.3% over the year. Across the Atlantic, Britain is facing a £35bn economic hit and the risk of a recession in 2026 because of the war, a thinktank warned.

While Congress was questioning the US defense secretary, Pete Hegseth, over the war’s rising costs and strategy, Iran’s foreign minister, Abbas Araghchi, spent the day making phone calls to India, Kenya and Poland, trying to shore up support in his country’s staring contest with the US.

The Guardian

Electric car giant BYD has become the first Chinese business to be raised in the European Parliament over allegations of labor abuses in Hungary, CNBC has learned, following a watchdog’s investigation into working conditions at the site.

Contractors hired to build BYD’s factory in Hungary allegedly kept thousands of employees working seven days a week, with shifts lasting more than 12 hours a day, according to a report published on April 14 by New York-based watchdog China Labor Watch (CLW). The group said it interviewed 50 workers and visited the factory site three times since October 2025.

China Labor Watch, a U.S.-based nonprofit organization that has tracked worker conditions since its founding in 2000, shared the report’s findings with EU government representatives. Earlier this month, three members of the European Parliament formally asked the European Commission about the alleged labor abuses in Hungary.

The allegations by China Labor Watch mark the first time claims of labor abuses linked to a Chinese-owned auto business manufacturing in the European Union have been brought to the attention of the European Commission, according to checks by CNBC. 

In February, a worker reportedly died on-site during a crane operation. Citing conversations with workers, CLW founder Qiang Li told CNBC there had been more deaths on site.

He added that, based on conversations with workers, broader medical support was inadequate as individuals were not always employed on work visas with corresponding medical insurance.

Hungary’s National Ambulance Service told CNBC Thursday that since Feb. 1, emergency medical services were called to the factory site 12 times, with one death. 

The latest allegations come as BYD has expanded into an automotive powerhouse, surpassing Tesla as the world’s largest electric car manufacturer in 2025. BYD is among a wave of Chinese companies expanding overseas, aiming to sell more than a million cars outside China this year as sales in its home market slump.

One contractor named in the report, AIM Construction Hungary, is a subsidiary of Jinjiang Construction Group — the same firm linked to a 2024 scandal at BYD’s factory in Brazil that national labor authorities said, following investigations, involved conditions “analogous to slavery.” 

BYD claimed in December 2024 that it stopped working with Jinjiang Construction’s Brazilian subsidiary in the wake of the scandal. But the CLW report allegations indicate BYD hired another subsidiary of the same Jinjiang group to build the factory in Hungary.  The report said CLW reviewed a sample labor contract for jobs at BYD’s Hungary factory, which included the option of being sent to Brazil and Turkey, where BYD is also building a factory.

AIM Construction Hungary was previously known as China Jinjiang Construction Hungary, according to company records from Hungary’s Ministry of Justice, accessed through an authorized data provider.

BYD and the Jinjiang entities did not respond to CNBC’s requests for comment. Authorities in the EU also did not respond.

The facility in the southern Hungarian city of Szeged is one of five BYD sites in Hungary, where the automaker established its European headquarters nearly a year ago during a visit by chairman Wang Chuanfu.

Forced to stay

The EU raised tariffs on China-made electric cars in 2024, in a bid to localize production. But China-made vehicles still climbed to a record 9.3% of new cars sold in the bloc in December, according to Rhodium Group.

BYD is rapidly growing its market share. New BYD cars registered in the EU more than doubled in the first two months of the year to 29,291, exceeding Tesla and gaining 1.8% of the market, according to the European Automobile Manufacturers’ Association.

By model, BYD’s Seal U ranked third in January registrations, behind models from Renault and Skoda, according to European Commission data. More than two-thirds of new passenger cars sold in Europe in January were electric.

Hungary received the bulk of China’s growing automotive investment in Europe over the last three years, according to Rhodium Group data.

BYD’s Szeged factory is slated to produce 300,000 cars per year at full capacity, though the timeline to reach that target is unclear.

As construction of the factory progressed, workers, mostly from China, were allowed to rest only when inclement weather halted work, according to CLW.

Managers “wanted to begin production of cars in January [2026], so they were rushing the project’s timeline — they weren’t letting workers leave,” Li said in Mandarin remarks translated by CNBC.

The Szeged facility manufactures BYD’s Dolphin Surf model, according to a company statement citing BYD Executive Vice President Stella Li. Local media reported in January that trial production had begun.

CLW’s Li said the contractors used a range of financial levers to keep workers on-site. Some were promised free plane tickets home if they worked for more than six months; others had wages withheld until their contracts were fulfilled, or incurred miscellaneous charges such as recruitment fees even before arriving on-site, according to the report.

Employees were directed to tell labor inspectors that they only worked “five days per week, eight hours per day, with one hour of overtime,” the report said. CLW alleged their actual working hours directly violated Hungary’s Labor Code — which limits working hours to eight per day, and no more than 48 hours a week — and that their conditions resemble the International Labor Organization’s definition of forced labor.

When CNBC contacted Hungary’s National Directorate-General for Aliens Policing about the allegations, the government department said it “took the necessary measures within the scope of its authority to conduct examinations of the matters described in the [CLW’s] submissions.”

Political fallout

In Brazil, BYD’s labor issues have led to political ripple effects.

Luiz Felipe Brandao de Mello, head of Brazil’s agency tasked with enforcing national labor standards, was removed from his post, according to an official government gazette. Reuters reported, citing two sources close to the matter, that de Mello lost his position due to a decision to add BYD to a blacklist restricting its access to loans.

Brazil’s labor ministry had added BYD to the list days earlier — only to have a Brazilian court reverse that decision until a final ruling was made.

Brazil’s national association of labor inspectors did not respond to CNBC’s requests for comment.

CNBC

Iran’s Foreign Minister Abbas Araghchi held high-level talks with Oman’s Sultan Haitham bin Tariq in Muscat, focusing on cooperation among Hormuz littoral states to “ensure safe maritime transit” amid the ongoing war with the US and Israel.

In a post on X, Araghchi stated: “Appreciative of my gracious hosts in Oman. Important discussions on bilateral matters and regional developments. As only Hormuz littoral states, our focus included ways to ensure safe transit that is to benefit of all dear neighbors and the world. Our neighbors are our priority.”

The meeting took place at Al-Baraka Palace in the Omani capital on Sunday, according to Press TV.

Discussions centred on the evolving regional situation, including efforts to resolve crises through dialogue and diplomatic engagement, alongside strengthening cooperation between the two countries.

Oman’s support for dialogue, mediation

During the talks, Araghchi briefed the Omani leadership on Tehran’s perspective regarding recent developments and outlined Iran’s diplomatic initiatives to address ongoing conflicts.

He also expressed appreciation for Oman’s continued support for dialogue and mediation aimed at enhancing regional stability.

Sultan Haitham bin Tariq reiterated Oman’s commitment to facilitating diplomatic solutions, emphasising the need to prioritise dialogue to mitigate the impact of crises on people across the region.

Sustained engagement

He underlined that sustained engagement and mediation are key to achieving long-term peace and security.

The meeting comes amid heightened tensions following the US-Israel conflict involving Iran, with Tehran stepping up diplomatic engagements across multiple capitals.

Oman has historically played a mediating role in regional disputes, particularly in facilitating indirect talks involving Iran and Western countries.

Following his Oman visit, Araghchi travelled to Pakistan, where he met senior civil and military leadership, including Chief of Army Staff Asim Munir, as part of efforts to sustain dialogue on the evolving situation.

He later departed for Russia to continue consultations with senior officials.

GN