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Ukraine and Middle East Conflicts Boost US Arms Makers Profits

Ukrainian servicemen ride a military buggy, amid Russia's attack on Ukraine, in the Donetsk region, Ukraine, October 21, 2025. (Reuters)
Ukrainian servicemen ride a military buggy, amid Russia's attack on Ukraine, in the Donetsk region, Ukraine, October 21, 2025. (Reuters)
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Ukraine and Middle East Conflicts Boost US Arms Makers Profits

Ukrainian servicemen ride a military buggy, amid Russia's attack on Ukraine, in the Donetsk region, Ukraine, October 21, 2025. (Reuters)
Ukrainian servicemen ride a military buggy, amid Russia's attack on Ukraine, in the Donetsk region, Ukraine, October 21, 2025. (Reuters)

Weapons makers Lockheed Martin and RTX predicted strong profits for the rest of this year on Tuesday as their results benefited from surging demand for arms from conflicts in the Middle East and a protracted Russia-Ukraine war.

Missiles, munitions and air defenses were important drivers for both companies, while Lockheed has been awarded an $12.5 billion contract from the Pentagon, for a total of 296 F-35 jets.

Sales at RTX, formerly Raytheon, were also driven by a shortage of new commercial jets as maintenance and repair service providers like RTX worked to maintain airlines flying older, cost-intensive fleets. It also benefited from better jet engine sales.

To be sure, Northrop Grumman trimmed its full-year 2025 sales outlook, but said that it would be more profitable than expected this year.

The company said that timing of certain awards to build weapons dimmed the forecast.

Beyond the replenishment of weapons that have been expended in global conflicts, the Trump administration's flagship Golden Dome missile defense system has bolstered the growth outlook for defense prime contractors.

RTX management told Wall Street analysts on a post earnings call that in addition to munitions replenishment, Raytheon was eyeing billions the US will put towards Golden Dome: "Those things are not in our backlog today. So those are potentially, additive to the backlog."

The Golden Dome system is estimated to cost $175 billion, but uncertainty looms over the basic architecture of the project because the number of launchers, interceptors, ground stations, and missile sites needed for the system has yet to be determined.

Contractors such as Lockheed, Northrop, RTX, and Boeing, have a variety of missile defense systems that are expected to play a role in the missile defense shield.

Northrop CEO Kathy Warden told analysts on Tuesday "we're very pleased to see the urgency the administration is placing on protecting the homeland and the set of opportunities that creates."

STRONG RESULTS

Lockheed Martin, the largest defense contractor in the world, raised its 2025 forecast for revenue and profit on Tuesday, driven by sustained demand for its fighter jets and munitions amid escalating geopolitical tensions.

Lockheed, which makes the F-35 stealth fighters, said its aeronautics segment sales jumped 11.9% to $7.26 billion in the third quarter.

Lockheed now expects a profit of $22.15 to $22.35 per share for 2025, compared with its previous estimate of $21.70 to $22.00.

The company also raised the lower end of its sales outlook to $74.25 billion from $73.75 billion, while maintaining the higher end at $74.75 billion.

Aerospace and defense giant RTX raised its full-year profit and revenue forecast on Tuesday as well, as rising demand for its missiles and services bolstered its ability to weather negative fallout from tariffs.

A shortage of new commercial jets is also driving sales at maintenance and repair service providers like RTX, who are banking on airlines flying older, cost-intensive fleets.

RTX, which makes the GTF engines and competes with CFM International, has benefited from booming demand from planemakers as they ramp up production.

RTX now expects its full-year adjusted sales between $86.5 billion and $87 billion, from its previous forecast of between $84.75 billion and $85.5 billion.

It also raised its adjusted profit forecast to between $6.10 and $6.20 per share for 2025, from $5.80 to $5.95.

Northrop Grumman, which also reported results on Tuesday, was the outlier, raising its 2025 profit forecast for a second straight quarter but trimming its full-year 2025 sales outlook. It now expects between $41.7 billion and $41.9 billion, compared with its previous forecast of $42.05 billion-$42.25 billion.

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Business

Iraq’s Oil Hub Slows to a Crawl as Strait of Hormuz Shutdown Strangles Exports

01 April 2026, Iraq, Erbil: Smoke rises from a motor oil depot on the outskirts of Erbil, after it was hit by a drone attack. Photo: Ismael Adnan/dpa
01 April 2026, Iraq, Erbil: Smoke rises from a motor oil depot on the outskirts of Erbil, after it was hit by a drone attack. Photo: Ismael Adnan/dpa
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Iraq’s Oil Hub Slows to a Crawl as Strait of Hormuz Shutdown Strangles Exports

01 April 2026, Iraq, Erbil: Smoke rises from a motor oil depot on the outskirts of Erbil, after it was hit by a drone attack. Photo: Ismael Adnan/dpa
01 April 2026, Iraq, Erbil: Smoke rises from a motor oil depot on the outskirts of Erbil, after it was hit by a drone attack. Photo: Ismael Adnan/dpa

Iraqi oil fields once alive with the buzz of workers are nearly deserted. Ports that pulsed with the churn of cargo have fallen still, the din of commerce replaced by the soft rhythm of waves.

A month after the war in Iran started, workers at ports and oil fields in the province of Basra, where almost all of Iraq's crude is produced and exported, have grown accustomed to rockets streaking across the sky, aimed at US air bases and other strategic facilities, The Associated Press said.

The war, which began with US-Israeli strikes, is dealing a heavy blow to Iraq's economy. Iraq relies on oil revenues for roughly 90% of its budget, and most of its oil is exported through the Strait of Hormuz, the narrow mouth of the Arabian Gulf where Iran has effectively stopped cargo traffic during the conflict. The war also has led to a sharp reduction in the volume of imported goods reaching southern Iraq's ports, while attacks have halted traffic at the border it shares with Iran.

Unlike other countries in the Middle East touched by the war, Iraq hosts both entrenched Iran-aligned forces and significant US interests, leaving it exposed to attacks from both sides. Since the war started, oil production in southern Iraq, where Basra is located, has fallen by more than 70% and the volume of imported goods reaching the country's ports has been cut in half. Drone and missile attacks have targeted American companies and military bases. Iran's allied Iraqi militias also have struck oil fields and energy infrastructure. Many foreign workers have left.

The Iraqi government should have enough funds to get through mid-May without new oil sales, according to experts, but then it will have to borrow money.

“After that, the government would resort to issuing bonds,” said Ahmed Tabaqchali, an expert in Iraq’s economy. “But not without consequences.”

Oil production suspended

Across southern Iraq, the closure of the Strait of Hormuz has prompted oil fields to scale back production and focus on domestic needs, while oil prices around the globe have risen. Basra’s Zubair oil field, once producing around 400,000 barrels per day, has seen output drop to roughly 250,000, officials said.

Iran has offered assurances that Iraqi crude can safely transit the strait, said Bassem Abdul Karim, the head of the state-run Basra Oil Company, which oversees production in the province. However, because Iraq lacks its own tanker fleet and depends on chartered vessels, shipments ultimately hinge on whether tanker owners are willing to accept the heightened risks of making the journey. Most are not.

At a degassing station in Zubair, where crude is processed, production has also slowed dramatically. “It’s quiet now because of the reductions,” said chief engineer Ammar Hashim. “Of course we are worried.”

The downturn in Zubair reflects a broader decline in Basra. Output has dropped from 3.1 million barrels per day to roughly 900,000 across the province, according to Abdul Karim.

“Exports are currently completely halted. At the moment, we are considering alternative loading areas, but none are fully operational,” he told The Associated Press.

That morning, a drone crashed in the Majnoon oil field north of Basra without detonating. A security official said it's an increasingly common occurrence, adding that the drone was likely headed toward US bases in Kuwait. Production at the field has been suspended due to the frequency of these events. The official spoke on condition of anonymity because he was not permitted to speak to news media.

Hundreds of employees from American, British, Italian, French and other international oil companies have left Iraq due to the war. The departures accelerated after a March 6 drone strike hit the Burjisiya complex in Basra, a key logistics hub for Iraq’s oil industry used by numerous companies. The attack targeted US oil services company KBR, striking its chemical storage facility.

Another drone struck the British-Petroleum operated Rumaila oil field, prompting some foreign workers there to leave, said Abdul Karim. The field is still operating, he said. On Wednesday, multiple drones attacked a fuel warehouse linked to BP in northern Iraq.

Efforts to reroute Iraq's oil face major constraints: The country doesn't have the capacity to boost exports via its northern pipeline, and trucking through Jordan and Syria is costly and inefficient, said Abdul Karim.

Shipping lanes closed Umm Qasr, Iraq’s primary deep-water port, was once so noisy with imported cargo that it could give you a headache, workers there said.

Now, with the Strait of Hormuz closed, large mother ships bringing shipments to Iraq can no longer get to the port. Instead, they dock in the United Arab Emirates, where the cargo is carried by trucks and then smaller ships to get to Umm Qasr, a costly workaround.

The port’s jetties are running well below their former capacity, with volumes halved by the war, according to port director Mohammed Tahir Fadhil.

When the AP visited, just one cargo ship from the U.A.E. had docked.

The threat to shipping lanes escalated after Iran destroyed two tankers on March 11 in Iraqi waters, the Marshall Islands-flagged Safesea Vishnu and the Malta-flagged Zefyros.

“Today, our only gateway for goods is the United Arab Emirates,” said Farhan Fartousi, director of the Iraqi Ports Company.

Trade disrupted

On Sunday morning, Haidar Abdul-Samad, deputy director of Basra’s Shalamcha border crossing with Iran, was on the phone with an Iranian official, complaining about electricity cuts that had halted trade, urging a quick resolution. The power cuts followed an airstrike that hit the Iranian side of the crossing.

Such disruptions, local officials say, have become routine.

Before the war, the crossing saw constant movement, reflecting strong familial and commercial ties between Iranians and Iraqis in the area. It is also a key transit point for traders and pilgrims heading to Shiite holy sites in central Iraq.

That morning, trucks were backed up for miles.

“Priority is given to food supplies to prevent price increases,” Abdul-Samad said. “Passenger movement is not at the same level as before; activity has declined due to the war in Iran.”

Once electricity was restored, 30-year-old Iranian trader Atefa Al-Fatlawi arrived with her husband and young son. She buys goods at lower prices in Basra to sell back home.

“We are scared because of the bombings,” she said. “Shalamcha was targeted. Today, there were no transport vehicles at the garage because of the attack.”

Business

Gold Prices Retreat as Trump Threatens Further Attacks on Iran

An Indian woman displays a gold jewelry piece at a jewelry store in Bangalore (AFP)
An Indian woman displays a gold jewelry piece at a jewelry store in Bangalore (AFP)
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Gold Prices Retreat as Trump Threatens Further Attacks on Iran

An Indian woman displays a gold jewelry piece at a jewelry store in Bangalore (AFP)
An Indian woman displays a gold jewelry piece at a jewelry store in Bangalore (AFP)

Gold retreated from two-week highs on Thursday after US President Donald Trump said that Washington would continue its military campaign in Iran in the coming weeks, pushing crude prices sharply higher and dampening hopes of interest rate cuts.

Spot gold was down 2% at $4,664.39 per ounce, as of 0439 GMT, snapping a four-day winning streak, while US ‌gold futures slid 2.5% ‌to $4,691.10.

The pullback followed bullion's climb to ‌its ⁠highest level since March ⁠19, prior to Trump's remarks, said Reuters.

In a prime-time address to the nation late on Wednesday, Trump said the United States would carry out aggressive strikes on Iran over the next two to three weeks and was nearing "completion of its main strategic objectives" in the conflict.

"Gold is pulling back after two superb days, as ⁠President Trump was quite bellicose in his tone, referring ‌to aggressive plans over the coming ‌weeks... it suggests the optimism of the last few days was exuberant ‌and there will be some retracement ahead of the long ‌weekend," independent metals trader Tai Wong said.

Markets reacted swiftly: the 10-year US Treasury yield and the dollar index both advanced, pressuring dollar-denominated gold.

Meanwhile, Brent crude surged more than 6% after Trump indicated continued targeting of Iran's energy ‌infrastructure, raising supply concerns.

Gold had already been under pressure, dropping 11% in March, its worst monthly performance ⁠since 2008, ⁠following the outbreak of the Iran conflict on February 28. The surge in oil prices has fueled inflation concerns, complicating the Federal Reserve's monetary policy outlook.

Expectations for U.S. rate cuts remain low through most of 2026. Bets for a December reduction have fallen to just 12%, down from around 25% before Trump's latest comments.

While gold typically benefits during periods of inflationary pressure and geopolitical tension, higher interest rates reduce its appeal by increasing the opportunity cost of holding the non-yielding asset.

In other metals, spot silver fell 4.6% to $71.67, platinum dropped 2.5% to $1,914.61 and palladium shed 1.4% to $1,451.92.

Business

Oil Rallies, Stocks Tumble as Trump Says US to Hammer Iran Further

Oil prices surged and stocks sank after Donald Trump's address to the nation. Alex Brandon / POOL/AFP
Oil prices surged and stocks sank after Donald Trump's address to the nation. Alex Brandon / POOL/AFP
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Oil Rallies, Stocks Tumble as Trump Says US to Hammer Iran Further

Oil prices surged and stocks sank after Donald Trump's address to the nation. Alex Brandon / POOL/AFP
Oil prices surged and stocks sank after Donald Trump's address to the nation. Alex Brandon / POOL/AFP

Oil prices spiked and stocks sank on Thursday after Donald Trump reiterated that US forces would hammer Iran for another two to three weeks but offered no solution to the closure of the Strait of Hormuz that has crippled global markets.

Investors appeared to be unimpressed with the US president's much-anticipated address to the nation, in which he again called on countries that rely on the waterway for their energy supplies to reopen it themselves, AFP said.

The comments came amid growing fears about the economic impact of the crisis, which has seen governments introduce support measures, with the World Bank saying it was "extremely concerned".

In a speech lasting less than 20 minutes, Trump added little to what he has said in the past, warning that "over the next two to three weeks, we are going to bring them back to the Stone Ages, where they belong".

He also told the nation that US forces would meet all their battlefield goals "very, very shortly".

The address dented a nascent recovery in world markets that had come after Trump said earlier this week that the war would be ending "very soon", while his Iranian counterpart said his country had the "necessary will" to end it.

Brent crude, which had fallen back below $100 a barrel Wednesday, surged as much as five percent to hit $106.29, while West Texas Intermediate jumped more than four percent to as high as $104.29.

Trump "spoke of objectives met, but not of resolution. Of continued strikes, not withdrawal. Of optional escalation, not closure", wrote Stephen Innes at SPI Asset Management.

"The message was not one of panic, but it was unmistakably one of unfinished business. And in markets, unfinished business is oxygen for volatility.

"So oil did what oil always does when the illusion cracks. It surged, not because the war suddenly worsened, but because the market had prematurely priced in the expectation that it would end."

The reaction among equity traders was no better, with Seoul -- which soared more than eight percent Wednesday -- losing three percent. Tokyo, Hong Kong, Shanghai, Singapore, Taipei and Sydney were also well down.

The speech "did not contain what the market had hoped for -- namely, indications of an end to the fighting", Jumpei Tanaka, of Pictet Asset Management, said. "Instead, he suggested a potential escalation of the situation, which is a clear negative for stocks."

Markets have endured huge volatility since the US-Israeli war on Iran was launched on February 28, with the president frequently U-turning after making policy statements, particularly with regards to foreign relations and military operations.

His announcements that Washington and Tehran were in peace talks have often been denied by the Iranian republic, while its Revolutionary Guards insisted the strait will remain closed to the country's "enemies".

Trump's repeated demand that countries that rely on energy through the Strait of Hormuz "get your own oil" comes as Britain prepares to host a meeting of about 35 nations Thursday to discuss how to reopen the waterway.

The meeting will "assess all viable diplomatic and political measures that we can take to restore freedom of navigation, guarantee the safety of trapped ships and seafarers and resume the movement of vital commodities", UK Prime Minister Keir Starmer said.

Meanwhile, the World Bank Managing Director Paschal Donohoe said he was fearful about the global economic impact of the crisis.

"We are extremely concerned regarding the effect that this will have on inflation, on jobs and on food security," he told AFP as the Bank announced a new partnership with the International Monetary Fund and International Energy Agency to coordinate aid responses.