Geopolitics and Business Report, Oct. 25, 2026: Black Sea Peril, French Bond Stress

Economic Warfare & Trade Policy › Sanctions

Good evening, this is The Boston Report, and welcome to the geopolitics and business report for Sunday, October 25, 2026. Tonight we follow the money along four fault lines: a Black Sea now deadlier for sailors than the Strait of Hormuz, a London court fight over how war-zone shipping gets priced, sanctions questions around a gas project in Alaska, and a weekend of elections and protests that traders will sort through when markets open Monday.

War Zones Rewrite the Cost of Shipping

We start at sea. More than 570 merchant vessels have been struck in the Black Sea so far this year, killing at least 40 sailors, according to maritime security firm Ambrey and the International Maritime Organization, the Financial Times reported on Sunday. That compares with 24 confirmed deaths around Hormuz. The pace has picked up sharply. About 387 ships were hit between July and September, more than five times the previous quarter, and Ambrey says Russia accounted for roughly 90 percent of strikes on shipping over the past 45 days. “This is a different ball game,” said Bridget Diakun, research director at Lloyd’s List Intelligence. The Boston Report covered one of these attacks in our story on the drone strike on a cargo ship off Romania.

The business damage shows up in insurance and trade. Underwriters told the FT that war cover in the Black Sea could reach 15 percent of a ship’s hull value, almost double the Gulf rate. Ports in Greater Odesa handled fewer than 10 ships last month, down from about 400 in July, according to port operator TIS. Ukraine’s farm exports by sea fell to 1.4 million tonnes in August, about three quarters below prewar levels. Grain buyers as far away as Indonesia are turning to Australia instead.

Meanwhile, the war with Iran has reached the courtroom. Starting Monday in London’s High Court, commodity trader Mercuria is challenging the Baltic Exchange, the 282-year-old body that publishes benchmark freight rates. Mercuria argues the Baltic should have suspended its flagship index for supertankers carrying crude from the Gulf to China after U.S. and Israeli strikes on Iran began in February. Mercuria is not seeking damages, only a ruling that rates published since early March are invalid. Lawyers for the Baltic warned a win for Mercuria would have “chaotic marketwide consequences,” and chief executive Mark Jackson said the Baltic believes the claim “is without merit.” The stakes are real, because the International Energy Agency says shipping a barrel of oil now costs as much as five times what it did last year on some routes.

Sanctions Questions Hit a $25 Billion Alaska Gas Venture

Next, sanctions. Polar LNG, a 25 billion dollar venture launched in March to repurpose a partly built gas terminal from Russia’s Novatek for use in Alaska, has lost most of its leadership. Former chief executive Joel Riddle told the Financial Times that he found Novatek was already financing and directing the project before U.S. Treasury approval had been granted. Riddle resigned in September, and almost the entire executive team followed. Polar LNG called Riddle a “disgruntled employee” and says it complies with U.S. law. A Treasury official said the department takes potential sanctions violations “extremely seriously.” People familiar with talks between Washington and Moscow told the FT that one proposal would trade Novatek’s expertise for lifting sanctions on its Arctic LNG 2 project. Novatek denies that its help depends on any sanctions relief. For background, see our investigation into whether the Russian oil price cap is working.

Bond Markets and Central Banks Under Political Pressure

In Europe, the street is moving the bond market. France’s Interior Ministry said 410,000 people marched on Saturday, while unions put the figure at twice that, and clashes broke out in Paris and Marseille after dark, CNBC reported. French 10-year borrowing costs hit their highest level since 2002 last week, and the gap over German debt is the widest since November 2011. The CAC 40 stock index is down 4.5 percent over the past month, and Carrefour shares plunged more than 14 percent on Wednesday after the grocer cut its profit outlook, citing the unrest and higher energy costs. On Friday, Moody’s kept its Aa3 rating on France, with a negative outlook. Lawmakers return to the budget’s tax measures on October 27, and unions have called a national strike day for November 5.

Writing in The American Prospect, co-editor Robert Kuttner, who teaches at Brandeis University’s Heller School in Waltham, argued that France, as a medium-sized economy, “is more dependent on the bond market than the U.S. is.” In Asia, The Economist reports that the Reserve Bank of India has used ever harsher tools to defend the rupee, including buying tens of billions of dollars’ worth of its own currency, curbing speculation and, on October 10, raising costs for companies that hedge. The rupee has recovered from just under 97 to the dollar to just under 95.

Ballot Boxes Markets Are Watching

Finally, elections. Brazilians voted on Sunday in a run-off between President Luiz Inácio Lula da Silva and right-wing senator Flávio Bolsonaro, who won the first round 47 percent to 45 percent, a result that sparked a market rally, the Financial Times reported. Investors are focused on Brazil’s large budget deficit. Our earlier coverage looks at the U.S. position in Brazil’s run-off. In Serbia, former president Aleksandar Vučić conceded defeat on Sunday to the grassroots Student List after 14 years in power in one role or another. And in Canada, British Columbia’s Conservatives won a majority, with 64 seats. Their leader, Lorne Doerkson, has pledged to double the province’s liquefied natural gas production by 2032 and to back Prime Minister Mark Carney’s plan for a pipeline carrying one million barrels of oil a day from Alberta to British Columbia.

Closer to home, the U.S. midterms are nine days away. In a New York Times op-ed, former Treasury Secretary Robert Rubin warned that an attempt to manipulate the vote could hit the economy, writing that “the markets are not pricing in what I consider a meaningful risk.” Kuttner, in the Prospect, countered that Rubin’s own deregulation of finance was a risk markets also failed to price.

That is the geopolitics and business report for Sunday, October 25. Watch the Mercuria hearing in London and the French bond market on Monday morning. For The Boston Report, good night.

Sources

• Financial Times: The Black Sea is now the world’s deadliest shipping route (also: Romania’s President Nicușor Dan accused Russia of escalating the war on the edge of NATO territory; Joint War Committee expanded its top risk zone to almost the entire Black Sea in mid-September)
• Financial Times: Mercuria challenging the ‘Dow Jones of shipping’ in court after Hormuz losses (also: rival Platts suspended its Hormuz oil assessments two days after the war began; the Baltic launched a new Fujairah-to-China benchmark this month)
• Financial Times: US executives quit $25bn gas venture over claims of secret Russian control
• CNBC: What next for France as riots rattle markets? (also: France targets a deficit of 5% of GDP in 2027, from a projected 5.4% in 2026; ING named retail, hospitality and transport as most exposed)
• The American Prospect: Robert Kuttner on France’s protests
• The American Prospect: Robert Rubin, Faux Statesman
• The Economist: India has stabilised its currency. But at what cost?
• Financial Times: Bolsonaro and Lula face off in knife-edge Brazil election
• Financial Times: Serbia’s ex-president Vučić concedes defeat to Student List (also: Vučić said he expected the Student List to win up to 140 of 250 seats; turnout was near 65%)
• Financial Times: Carney’s energy ambitions boosted by Conservative victory in British Columbia (also: Canada supplies about 60% of U.S. oil imports)