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Good morning and welcome to FirstFT. In today’s newsletter:
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Nato and EU officials squabble over defence spending
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Spain’s Repsol to regain control of Venezuelan oil operations
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Gulf states raised $10bn in wartime borrowing spree
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UK investor builds $500mn stake in TikTok owner
We begin with the EU and Nato, which are at odds over how to manage an extra $1tn a year rearmament drive prompted by Donald Trump’s threats to European security.
‘Turf war’: The US-led military alliance has long opposed Brussels taking on defence powers. But the US president’s demands on allies to invest more in their own militaries have forced an overhaul of arms production policy in the EU.
“There’s a turf war over defence industrial policy,” said an official. “This is about who manages the production scale-up, and what impact that has on the weapons Europe will be using in the future.”
Sticking point: One key aspect of the debate is what role US weaponry should play in the rearmament push, with Nato opposed to the EU’s “Buy European” approach across its wider industrial policy strategy.
Henry Foy has more from Brussels.
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Paying for defence: Security is the first duty of any government, but achieving that comes at a cost to society, writes Chris Giles.
Here’s what else we’re keeping tabs on today:
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UK: February GDP figures are due out. They will give an important signal of the effect of surging energy prices from the conflict in the Middle East and whether a recession is on the cards. A Reuters poll points to a 0.2 per cent expansion from January.
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Results: BNY, Netflix and Tesco report earnings.
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Five more top stories
1. Exclusive: Repsol is poised to take back operational control of its oil assets in Venezuela and boost production following a deal signed with the Caracas government. The Spanish energy group is expected to announce the agreement today, which will include plans to triple production from its Venezuelan operations within three years.
2. Gulf states have raised almost $10bn in private sales of bonds this month in their first international borrowing since the Iran war delivered a major hit to their economies. Since the start of April, Abu Dhabi has sold $4.5bn, Qatar $3bn and Kuwait $2bn in private placements of US dollar bonds.
3. Exclusive: A London-based tech investor has accumulated a ByteDance stake worth more than $500mn, betting that the Chinese social media and AI group is undervalued compared with its Silicon Valley rivals.
4. Exclusive: Nissan has held talks with China’s Chery about building cars at the Japanese group’s Sunderland plant, the latest effort by legacy carmakers to partner with rivals as they seek to safeguard the future of European and UK factories.
5. Norway’s sovereign wealth fund, the world’s biggest, does not intend to shed US assets, according to the finance minister, despite concerns over the Middle East war and mounting US debt. Jens Stoltenberg added that America’s presence in capital markets is so large that big funds will always have exposure to it.
News in-depth
Regional tensions have long focused on Iran’s nuclear or missile programmes. But for Tehran it is the Strait of Hormuz that has become its most important point of leverage. Najmeh Bozorgmehr writes on how using the waterway as a weapon could affect the regime.
We’re also reading . . .
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Patient data: Some NHS employees are opposed to using Palantir but it doesn’t make sense to abandon software that gets results, argues John Gapper.
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Narrow window: Hungary and the EU have a fleeting chance to improve regional defence and correct the bloc’s dysfunction, writes Zselyke Csaky of the Centre for European Reform.
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Art market: Sotheby’s made a $53mn pre-tax profit in 2025, ending years of losses at billionaire Patrick Drahi’s auction house.
Chart of the day
Pope Leo XIV has emerged as a fearless foe of Trump. As he steps up his criticism of the Iran war, the first US-born pope’s attack on White House policies could have electoral consequences in the pontiff’s native country, while risking political peril for the president.
Take a break from the news . . .
The design for V&A East, London’s latest cultural spot, was inspired by a Balenciaga dress. For Edwin Heathcote, the resulting building looked weird. On the other hand, he found the galleries inside a true delight.
