Some spats are cooling off

Good afternoon, ladies and gentlemen. The price of the war is being negotiated in two places this morning: In whatever channel Washington and Tehran are now using, and in the fare tables airlines are drawing up for next summer.

The US and Iran are exploring a phased agreement to reopen the Strait of Hormuz and lift Washington’s blockade on Iranian ports, as we note in this afternoon’s War Watch, below. One Iranian official framed it as solving the crisis in stages: Tehran gets relief from economic pressure, Washington gets lower fuel prices. Brent is trading around USD 105 and eased on the report, with Houthi missile fire toward Saudi cities keeping a floor under it.

Airfares will need to rise 10-20% next summer if oil stays where it is, Ryanair’s Michael O’Leary said, according to Reuters. Jet fuel rose 7.4% last week to USD 194.9 / bbl, more than double its 2025 average of USD 90, and Middle Eastern carriers flew 9.5% of global traffic last year into what is the industry's peak season.

Meanwhile, at least one of Washington’s spats is looking calmer, as Trump and Xi extended their trade truce by two months before they sat down. The expiry moves to 10 January, the New York Times reports, buying time to negotiate. The terms keep select US tariffs suspended in exchange for continued Chinese supply of rare earths.

Closer to home: Morocco has elected the parliament that will oversee the last stretch of its USD 20 bn World Cup build-out. The liberal, centrist PAM took 97 of 395 seats, up from 87, moving from junior coalition partner to first place, Reuters reports, on provisional results delivered by Interior Minister Abdelouafi Laftit.

The late addition that moved the scales: Fouzi Lekjaa, football federation chief and twice government budget manager, credited with the national team’s rise and with overseeing the 2030 infrastructure spend, who joined weeks before the vote and is now a leading candidate for prime minister — the king picks from the winning party, and PAM leader Fatima Ezzahra El Mansouri is the other name in frame. Turnout fell to about 38% from roughly 50% five years ago — worth holding onto, given PAM campaigned on USD 37 bn and a mn jobs aimed squarely at youth discontent. –Salma