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Global Briefing May 4

Europe Drafts Post-American Security Plan as Iran War Shocks Spread

European officials are quietly drafting a 'European NATO' contingency in case Washington withdraws Article 5 backing, the Wall Street Journal reported. Brent held at $126 with the Strait of Hormuz fully closed, and 2007 and 2022 oil-shock task forces were revealed to have rejected modelling a closure as not credible. Türkiye's manufacturing PMI plunged to 45.7 and CPI rose to 32.37 percent, Germany's Ifo auto index fell to minus 23.8, and UK food prices are tracking 50 percent higher than 2021. A drone struck Zaporizhzhia NPP's radiation lab; a Russian Iskander killed five civilians in Merefa.

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Drone hits external radiation lab at Russia-occupied Zaporizhzhia nuclear plant; IAEA seeks access

A drone struck the External Radiation Control Laboratory at the Russia-occupied Zaporizhzhia Nuclear Power Plant on 3 May, the International Atomic Energy Agency said. The lab sits outside the plant's perimeter; the IAEA reported no injuries and has requested access to assess possible damage. The strike follows a 27 April drone attack near the plant that killed a vehicle driver and triggered the facility's 15th loss of external power since the full-scale war began.

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UK food prices on track for 50% rise since 2021 as climate, energy and Iran-war shocks compound, ECIU finds

UK food prices are on track to be 50 percent higher this November than at the start of the 2021 cost-of-living crisis, research from the Energy and Climate Intelligence Unit shows. Beef is up 64 percent over five years and olive oil has more than doubled, with the Bank of England forecasting food inflation to reach 7 percent by year-end on higher fertiliser, energy, and transport costs. The Iran war is expected to push prices further as oil and gas surge, the analysis warns.

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Turkish manufacturing PMI plunges to 45.7 in April, deepest production cut since COVID, on Iran-war shock

Türkiye's Istanbul Chamber of Industry manufacturing PMI fell to 45.7 in April from 47.9 in March, the steepest production cut since the COVID-19 pandemic, S&P Global said. The reading marks 25 consecutive months of contraction, with new orders and export business both falling by much more than in March as the Iran war drove higher input costs and supply-chain disruption. Firms responded by cutting employment, purchasing, and inventories. The PMI plunge sits alongside a record April export reading of $25.4 billion the same week.

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Russian Iskander missile strike on Merefa kills five, injures 19

A Russian Iskander ballistic missile struck the town of Merefa in Kharkiv Oblast on the morning of May 4, killing five civilians and injuring 19, according to the Kharkiv Regional Prosecutor’s Office. Four people died at the scene, and a severely injured woman later died in hospital. The attack damaged residential buildings, shops, a restaurant, a car repair shop, and cars.

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