• New inflation number incoming: The U.S. Bureau of Labor Statistics will publish the Consumer Price Index for March—the first full month of the war—later today. The expectation is that it rose one percentage point to 3.4%, per ING.

Get ready for oil hoarding

Oil prices will stay “high for longer” even if the U.S. and Iran can make a peace agreement because governments don’t believe the peace will last, according to Macquarie analysts Thierry Wizman and Gareth Berry. Even if the Strait of Hormuz is reopened, nations will start hoarding it in fear of a resumption of hostilities, they advised clients:

• “It's the risk of renewed disruption (or control of the Strait by Iran) that will make crude oil appear scarce, and why the industrialized countries will want to hoard supplies immediately. That will push the spot and futures prices higher than they would otherwise be without the tension. And hoarding of crude oil could be just as inflationary as a shut-in of crude oil.”

“Dated Brent” is becoming a problem: There are already signs of stress in the oil market, according to CNBC. The price of “dated Brent,” which reflects cargoes at sea due for delivery between 10 days and a month from now, was at $131.97 per barrel on Thursday.

ONE BIG THING

EXCLUSIVE: Has Anthropic built something too dangerous and too expensive to commercialize at scale?

Anthropic says its new AI model, “Mythos,” is too dangerous to be released because it can be used by hackers to find cyber security vulnerabilities that humans don’t even know exist. That’s an unusual stance for a company valued at around $380 billion and preparing for an IPO, according to Fortune’s Bea Nolan. The company is rolling out Mythos via an invitation-only initiative restricted to organizations focused on security risks, such as Amazon, Apple, Microsoft, and Cisco. That looks like pretty great brand-building, according to Paulo Shakarian, a professor of artificial intelligence at Syracuse University. It “plays really well with the chief security officers of the world,” he said.

But it may also be the case that Mythos is so large, and requires so much computing power, that the company cannot afford to support its release to the general public. “I think it is likely that they simply do not have the GPU and other compute resources available to serve it at scale,” says Richard Whaling, lead researcher of cybersecurity startup Charlemagne Labs.

• Scott Bessent called in U.S. bank CEOs to discuss Anthropic model’s cyber risks - FT

IRAN

U.S.-Iran peace talks begin as the White House goes to war against the media, insider traders, and the Vatican 

Peace talks between Iran and the U.S. are scheduled to start today in Islamabad, Pakistan. Conflict between Israel and Hezbollah, Iran’s proxy terror group in Lebanon, continued overnight and this morning. Live coverage from the BBC here.

President Trump accused Iran of violating the ceasefire agreement: “Iran is doing a very poor job, dishonorable some would say, of allowing Oil to go through the Strait of Hormuz. That is not the agreement we have!” he said on Truth Social.

• Only 12 ships have passed through the strait in the last 24 hours, according to this live monitoring site. That’s up from seven ships the previous day. Normally, 130-plus ships navigate the gap daily.

Inside the White House, staffers were formally warned to stop placing insider bets on commodity indexes and prediction markets like Kalshi and Polymarket. Fifteen minutes before Trump announced there would be peace talks with Iran, $760 million of oil futures contracts changed hands “in less than two minutes,” the Wall Street Journal reports. On Polymarket, three accounts earned $600,000 by correctly predicting the exact time of the Iranian ceasefire.

Trump was angry at the Wall Street Journal last night: “The Wall Street Journal, one of the worst and most inaccurate ‘Editorial Boards’ in the World, stated that I ‘declared premature victory in Iran.’ Actually, it is a Victory, and there’s nothing ‘premature’ about it! Because of me, IRAN WILL NEVER HAVE A NUCLEAR WEAPON and, very quickly, you’ll see Oil start flowing, with or without the help of Iran and, to me, it makes no difference, either way. The Wall Street Journal will, as usual, live to eat their words. They are always quick to criticize, but never to admit when they’re wrong, which is most of the time!”

He also slammed former allies Tucker Carlson, Megyn Kelly, Candace Owens, Alex Jones, and Marjorie Taylor Greene. See the tirade here.

• Must-read story on the Trump Administration denying reports that one of its officials threatened to set up a rival papacy if the Pope didn't tone down his criticisms of the war, via the FT.

MORE FROM FORTUNE

Defense executives worry Trump’s proposed military splurge could backfire - Diane Brady

Schools across America are quietly admitting that screens in classrooms made students worse off and are reversing years of tech-first policies - Marco Quiroz-Gutierrez

EXCLUSIVE: Eva Longoria says she refused to be a ‘struggling actor’—so she worked part time as a headhunter, closing deals from her soap opera dressing room - Orianna Rosa Royle

‘We owe it to the next generation’ to get national debt under control, says think-tank boss, as U.S. borrowing hits $1.2 trillion in just six months - Eleanor Pringle

‘Good for Russia, good for China, bad for America’: how the Iran war is reshaping global economies and power - Nick Lichtenberg

The world’s 500 richest people made more than a quarter trillion yesterday as volatile markets react to fragile Iran war ceasefire - Jacqueline Munis

CHART OF THE DAY

Oil shocks can cause “stagflation” — but it’s temporary 

The long view of what historic oil crises do to GDP growth shows that … it’s not terrible, J.P. Morgan’s Bruce Kasman argues. “Large energy supply shocks weigh on global growth and raise consumer price inflation. However, the magnitude and duration of this ‘stagflationary’ tilt varies greatly. Energy shocks in the 1970s were associated with global recessions and persistent inflationary pressures. The stagflationary tilt in subsequent episodes was more modest and transitory. Global recessions were avoided amidst highly differentiated outcomes across regions,” he said in a research note seen by Fortune.

NUMBER OF THE DAY

30%

The share of renewable energy among European countries’ various energy sources. Non-carbon energy is now Europe’s largest supply source, according to data gathered by ING’s Gerben Hieminga and Nadège Tillier. Renewables were 20% of supply before Russia invaded Ukraine in 2022, pinching Europe’s gas supplies. Gas consumption fell 20% across the continent since then, and now forms only 19% of European energy supplies. Hydro power is 21%, nuclear is 15%, and coal is 8%.

THE FRONT PAGES TODAY

Melania Trump says she's "never been friends with Epstein" in rare address - Axios

When Bill Ackman Vented Over $2 Million, Fellow Billionaires Rushed to Commiserate - WSJ 

UBS Won’t Release Nazi Accounts Settlement Files Sought by Investigator After Court Setback - Bloomberg

Afrika Bambaataa, Often Called the ‘Godfather of Hip-Hop,’ Is Dead - NYT

ONE MORE THING

Without immigrants the U.S will need robots, Pimco says

The U.S. labor force has stopped growing and may be about to shrink, according to a note from Pimco economist Tiffany Wilding. Declining immigration is mostly to blame. Without a supply of new workers, employers will be forced to turn to AI to find gains in productivity, she argues.

“More restrictive U.S. immigration policies along with long-running demographic trends are reducing labor supply growth and employment trends essentially to zero. This means that the U.S. economy now relies solely on real productivity growth to maintain its 1.5% to 2% trend in overall GDP growth—an unprecedented dynamic.”

“Economic growth may largely depend on how quickly and effectively AI implementation can contribute to sustainably higher productivity growth,” she said. “Without a significant boost from AI, stagnant labor force trends could eventually lead to lower investment, slower growth, and lower rates.”