Bracing for the worst

The global energy crisis may be about to get worse — potentially much worse.With Russia’s invasion of Ukraine lifting the cost of filling ga [View in browser]( [Bloomberg]( Follow Us [Get the newsletter]( The global energy crisis may be about to get worse — potentially much worse. With Russia’s invasion of Ukraine lifting the cost of filling gas tanks, heating and cooling homes and powering industry across the globe, leaders are scrambling for ways to halt a spike in living costs that have sparked deadly protests from Africa to Sri Lanka. Key reading: - [Worst of Global Energy Crisis May Still Be Ahead, IEA Says]( - [US Believes OPEC Has More Capacity to Raise Crude Production]( - [Treasury Says Russian Oil Price Cap Key to Avoid New Cost Shock]( - [London Hit With Dangerous Heatwave That Could Get Worse]( - [European Heatwave Risks Curbing French Nuclear Power Production]( In the US, officials warn that a vast swath of the nation, from the Great Lakes to the West Coast, is at risk of power blackouts. Scorching weather in Europe — following the third-warmest June on record — underscores the consequences of a warming planet. It’s the most extreme energy crisis the world has ever witnessed, says Fatih Birol, the head of the International Energy Agency, and it may have “serious implications for the global economy” as winter approaches. US President Joe Biden is on a tour of the Middle East this week in which he hopes to convince OPEC members Saudi Arabia and the United Arab Emirates to raise crude output to help tame high global energy prices. Group of Seven leaders also agreed last week to explore capping the price of Russian oil exports. That’s unlikely to be enough. Big companies have been laying off employees and going dark since last month over soaring utility bills. High temperatures also pose potentially lethal danger, with officials in London issuing an alert requiring health-care services to protect high-risk groups. While urging people to conserve energy, governments are also firing up coal plants again to plug the supply gap, a move that risks exacerbating the climate crisis. Still, there’s a possible silver lining. Birol suggests that, just as the energy crisis of the 1970s and 1980s drove the development of nuclear and other technologies, today’s squeeze may accelerate a push into renewables. As Chris Bowen, Australia’s climate change and energy minister, said today: “There’s no time to waste.” — [Michael Winfrey]( Even as use of solar and wind energy rise, Europe still relies mostly on fossil fuels. Photographer: Bartek Sadowski/Bloomberg Click [here]( to follow Bloomberg Politics on Facebook and share this newsletter with others. They can sign up [here](. Global Headline Scrutinizing Trump | The House committee investigating the Jan. 6 attack on the US Capitol in 2021 will zero in today on whether former President Donald Trump [conspired]( with or encouraged far-right extremists who carried out the insurrection. [Billy House]( and [Chris Strohm]( lay out some key things to watch for. - Elon Musk said Trump should “[sail]( into the sunset” rather than run for president again and predicted Florida Governor Ron DeSantis will easily beat Biden if the two square off in 2024. Air power | Iran is preparing to provide Russia with hundreds of [drones]( including some capable of carrying weaponry, US National Security Advisor Jake Sullivan told reporters, adding that the Islamic Republic may begin training Russians to use them this month. Moscow has relied heavily on the unmanned aircraft in its invasion of Ukraine, while the US has supplied drones to the government in Kyiv. - The Kremlin says that Russian President Vladimir Putin will visit Iran next week. - The Kremlin is using a combination of [criminal]( charges and pressure on technology companies to try to censor Russian-born social media influencers living outside the country who are critical of its war. - Follow our latest coverage of Russia’s war in Ukraine [here](. Amid a rising wave of nationalism, Chinese shoppers have mounted at least 78 boycotts of foreign companies since 2016, a new study found. In general, firms quickly [apologize]( when they’re being boycotted for issues around territory China considers sovereign, but far less frequently when it comes to alleged human rights violations. Premiership pitch | Former Chancellor of the Exchequer Rishi Sunak sets out his [bid]( to be the UK’s next prime minister today, pledging to cut taxes once inflation is under control. Sunak is currently the front-runner in the 11-strong field that will start to be whittled down today, with contenders needing the backing of 20 MPs to make it onto the first ballot. - The risk of a UK [recession]( in the next 12 months is now almost 50-50, according to a Bloomberg survey. Best of Bloomberg Opinion - [Biden Can Unite US Allies in the Middle East: Hussein Ibish]( - [UK’s Imperial Nostalgia Should Follow Johnson Out: Pankaj Mishra]( - [Expect More Hostage Diplomacy From a Desperate Iran: Bobby Ghosh]( Next generation | While Sri Lanka’s President Gotabaya Rajapaksa is set to resign tomorrow, faced with widespread anger against his family’s rule, a younger [relative]( is looking to the future. [Sudhi Ranjan Sen]( reports that his 36-year-old nephew, Namal Rajapaksa, is already thinking of how the dynasty can salvage its reputation. Explainers you can use - [Thirteen ‘Perfect Storms’ That Are Sweeping the World Right Now]( - [Why Central Banks Got Serious About Digital Money]( - [Los Angeles Considers Ban on New Gas Stations and Fuel Pumps]( Laid to rest | A private funeral was [held]( in Tokyo today for family and associates of former Prime Minister Shinzo Abe, whose assassination last week shocked Japan. Current premier Fumio Kishida pledged to pursue Abe’s policies, including attempts to change the country’s pacifist constitution to bolster its defenses. Crowds lined the streets outside a Buddhist temple where the ceremony took place. Akie Abe, wife of Shinzo Abe, prepares to leave her residence with her husband’s body. Photographer: David Mareuil/Anadolu Agency/Getty Images Bloomberg TV and Radio air Balance of Power with [David Westin]( weekdays from 12 to 1 p.m. ET, with a second hour on Bloomberg Radio from 1 to 2 p.m. ET. You can watch and listen on Bloomberg channels and online [here]( or check out prior episodes and guest clips [here](. News to Note - Senior US officials are fanning out across Asia in a [diplomatic]( push, a further sign of intensifying competition with China for influence in the region. - Tension is spreading through Shanghai as residents watch the Covid-19 caseload tick higher, fueling fears they’re headed back into [lockdown]( just weeks after exiting a bruising two-month ordeal. - Mexican President Andres Manuel Lopez Obrador will use his White House visit this week to urge Biden to allow more legal [immigration](, which he says would help curb inflation. - India is expected to [surpass]( China to become the world’s most-populous nation in 2023, four years ahead of an earlier estimate by the United Nations. - The WeChat app became so [powerful]( in China that it could have posed a real threat to Beijing’s rule, according to a new book. - Brazil is negotiating to buy cheaper diesel from Russia as part of a [strategy]( to reduce domestic fuel prices, according to President Jair Bolsonaro. And finally ... Biden unveiled one of the first full-color pictures from the James Webb Space Telescope, the $10 billion observatory designed to view deep into the cosmos and time to provide the sharpest views of the early [universe]( ever captured. It depicts the galaxy cluster SMACS 0723 as it appeared 4.6 billion years ago and shows tiny faint structures in distant galaxies never seen before. NASA will release more images today. The first image released from NASA’s James Webb Space Telescope. Source: NASA/STScI Like getting this newsletter? [Subscribe to Bloomberg.com]( for unlimited access to trusted, data-driven journalism and subscriber-only insights. You received this message because you are subscribed to Bloomberg's Balance of Power newsletter. [Unsubscribe]( | [Bloomberg.com]( | [Contact Us]( [Ads Powered By Liveintent]( | [Ad Choices]( Bloomberg L.P. 731 Lexington, New York, NY, 10022