Power Lunch - President Trump's 8 p.m. ET Deadline for Iran Deal Approaches 4/7/26

Episode Date: April 7, 2026

President Trump's 8 p.m. ET deadline for Iran Deal approaches. Transportation Secretary Sean Duffy joins in an exclusive interview with Phil Lebeau.  And former TD Ameritrade CEO Joe Moglia joins with his market playbook.  Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

The future of the Middle East in focus, President Trump is issuing an ominous threat to Iran. Welcome to Power Lunch alongside Kelly. I am Brian. Here is where we stand at this hour. The big three indexes. They're all lower right now, not by a lot, down about four-tenths of 1%. Small and mid-cap stocks, though, they are flat to even higher. All eyes on energy. Oil continues to be front and center. The WTI June contract, just under 100, the Brent.

crude contract at 110, Kelly. Plus, an exclusive interview with Transportation Secretary Sean Duffy, answering tough questions on air travel safety and Boeing 787 Dreamliners as production is said to increase later this year. We begin, though, with President Trump escalating pressure on Iran as his ultimatum nears its deadline. Iranian officials now have less than six hours to allow tankerships to flow through the Strait of Hormuz. If that doesn't happen, the president warned, quote, a whole civilization will die tonight. never to be brought back again. He adds he doesn't want that to happen, but it probably will.

This comes as the U.S. military has struck down targets on Karg Island military targets. It's just a strategic site off Iran's southern coast and the country's primary oil export hub. For more on the geopolitical risks and their impact on the market, let's bring in Joe Muglia. He's the former TD Ameritrade chairman and CEO who's here on set with us alongside Michelle Crusoe Cabrera, CEO of MCC Global Enterprises. Michelle, you know Karg Island well. You visit there back in 2016, seeing these facilities. You might be the only Western journalists ever granted access, which makes today's news, from your point of you, probably even more striking. Yeah, so I don't believe that the president is going to order that every Iranian die tonight

through attacks. I find that highly improbable, and I think you see the market reacting that way because of that. Carg Island, he's talked about taking Carg Island in the past, actually, many years ago. We have Marines deployed to the region. So this is, something I'm going to be watching tonight. Will he order the military to take Carg Island? Why that would matter? That is where 90% of Iran's exports leave from. That's how they get foreign exchange. That's how they get dollars. It is crucial for their economy. Do you think, is there a little bit of a bait and switch going on where he's saying, warning about action over here on the bridges and on the power plants, but really there's

a different operation going on, or is this all part of... He likes to be unpredictable? He tells people that he likes to be unpredictable. So that's possible. I don't pretend to know what's in his mind. I think a lot of people come on TV and try to tell you what they think Donald Trump thinks. I don't know. And I don't think they do either. But certainly that is possible. Should we be shocked, Joe, at how calm the markets appear? Markets are down a little bit today, but they've been up. Small and mid-cap stocks are actually higher this year. Yeah. I don't know, Brian, if we should be shocked at this. I think that this has been going on for a while now. When the president had a speech the other night, he said it was 32 days at that time.

It's 40 days or whatever it is now. So we've been kind of going back and forth anyhow. When the market thinks something good is going to happen, it reacts that way. Bad reacts that way. Right now, the market doesn't know what's going to happen tonight. Per Michelle's point, we don't know. We just don't know what's going to happen. We do know that the longer this goes on, we're going to have oil $125, $150, $150 a barrel.

You believe that. The longer it goes on, yeah. If this is still going on 30, 40 days, now, I can see it's a 125, 135, 135, if it should have not come to an end. And I think the biggest concern that I've got when you think about the Iranian leadership and their mentality, you know, they know they're not going to win this, but from their perspective, they don't have to win it. They just sort of have to wait us out. We're the ones to spend a million dollars a missile, and they're spending $25,000 for a drone.

Over a longer period of time, that's not a good thing for us. So you're an active trader now, and you ran TD Ameritrates. So put on sort of the market hat. Okay, there's three. And if I'm wrong, say something. All right, there's three possible outcomes, really tonight and into tomorrow. Number one, best case, we get some very positive commentary. It looks like we're working toward a real sort of peace deal involving nuclear, whatever. Best case scenario, I think markets rip higher, correct?

I'd agree. Okay. Scenario two is we kind of get a punt, a taco, whatever you want to call it. Some positive words. Well, yeah, you know, what they say is sort of that Trump always chickens out. We don't have it. It doesn't work. We punt it a day or two.

You're an ex-football coach, right? or outcome three, which we don't want to think about, which is what the president kind of implied, said directly this mass bombing of Iran. If that's the case, what happens? The markets are going to crash. I think the market's going to crash. I think as far as the individual investor goes,

if you haven't made changes in your portfolio as of now, now is not the type to panic. You've got to be very careful. One of the things that we did when the war began was we had actually had a war strategy. had a template, and we wanted to go launch stocks like energy, national gas, et cetera, national defense that we thought would do well. We wanted to be short, cruises, and the airlines.

And we shorted the SP500 with the spy. Tonight, to do something with stocks, we're not going to be able to do that. But good news or bad news, the spy futures trade 23 out of 24 hours a day. They'll be trading later on. We'll miss the beginning of that move, but we would cover our short if it's good news. will add to it if it's bad news, the typical individual investor is not going to be able to do that. So you can't panic.

If you haven't done much, now you're going to have to be able to ride it through. I'm thinking, Michelle, what you said about oil and Carg Island and what may happen here. And there's been this weird logic where the U.S. has allowed for Iranian oil to move through the market. And to some extent saying, look, any barrels in the market will keep the oil price lower for everybody.

I don't know if we're trying to throw that scenario out now and say we don't really want them calling the shots. We don't want their oil to be the one that gets through. Like, we're putting it into that now, even if it results in a high. higher near-term oil price. I think the thoughts about Cargo Island are that if they take it, they're able to control more about how much oil actually leaves, right?

Yes, ghost ships have been getting out. Iranians have been able to send oil to the Chinese, their customers, and the U.S. hasn't been against that because oil is fungible. The more oil that's out there, the lower the price is going to stay, right? I think the way I continue to think about this always is to focus very much on what the Pentagon says on any given day. General Kane, day one, came out and said the military objective is to destroy Iran's ability to project power.

That means we're going to destroy their missiles, we're going to destroy their Navy. And we're going to do anything. We're going to have air superiority. And I don't think this is done until they are convinced they have achieved that. Because that is the military goal of this exercise from day one. Just last hour, we spoke with Charles Kupchen, who said he thinks they're surprised by the fact that Iran can still do all of these retaliatory strikes, hit planes, and so forth. they didn't think they would still have this wherewithal at this point of the conflict.

So war games have been done in the past for many, many years where they've said, okay, what if Iran can get off 250 missiles at a time? And day one, they got off several hundred missiles. They got off several hundred drones. They've never been able to repeat that. We've got 40 drones, up to 80 drones, 40 missiles, 20 missiles. Some days it falls to as low as seven. Their ability to project power is definitely degraded a lot because the number of missiles that goes off every day is far small. smaller than it used to be, but they're not done yet. They always said four to six weeks.

So we're at week four. Yeah, but to Joe's point, I think earlier, as we found, and you were there, you saw Carg Island. It's not very big. Apparently there's a gazelle of some kind. There's supposedly gazelles there. Whatever it is. There's supposedly military equipment there as well. I never saw that either, but I was controlled, right? I had a binder. We moved with the jitney in a jitney. But they can cause, and I've been to that region, you can do a lot of damage with a small bomb attached to a speedboat. You blow up one super tanker, Joe, and you scare everybody off, you scare the insurance markets off, you scare oil prices up. They know they've got

the ability, I think, to damage the Western and American economy vis-a-vis oil prices. Do they not? Well, that winds up going back to the point I was trying to make earlier where the Iranians, the leadership within Iranians, the leadership within Iran just has to wait this out. And longer they waited out, the more of a problem is going to be for us. Oil price is going to go higher. And while we know we're energy independent, we're also part of a global economy. If the rest of the world is paying much higher price for oil, we're going to be paying that as well. And that's kind of a real negative impact on trade. And the possible scenario there could be a global recession. If Taiwan or South Korea cannot make microchips or memory chips or semiconductors, because they have a

shortage of natural gas or helium, which goes into all of these things. And that hasn't happened yet, but it gets closer every single day. If we get something like that, does the market fall 10 percent? Stock's here? Ten percent's a big number. But yeah, that could happen. Yeah, that could happen. I mean, the whole point, the way Iran wins this is by doing exactly what we're talking about now. They weighted out. Oil prices go crazy. Chip industry winds up having problems. There'd be a scarcity of supply around the world and all sorts of different things. It becomes a global recession. That's the problem.

I think deep down, that's what the Iranian leadership is trying to do. They're not going to win, but as long as they have one drone left, as long as they can postpone the end of this, the rest of the world could potentially suffer from that. Yeah, they're trying to raise the cost of the war for the entire economy and for the president. How are you, Michelle, thinking through the end game and how to, you know, you mentioned watching the military officials for kind of their description of the campaign. Of how it's going, right? And how it's going and what the goals are. And, you know, again, that's what the market's trying to get to. Yeah. So, you know, I was disappointed yesterday when they held the news conference to talk about the very dramatic and amazing rescue of the airmen. And there was no update on the state of the war.

And I didn't know if that was because they wanted to keep it very focused on the heroism, which was just incredible. right? But, you know, we haven't heard the latest. There are reports that come out every day out of Israel, where you get a sense of how things are going, where they continue to target so many different locations in Iran. We've targeted 13,000 locations. Wow. It's a lot. We've gotten off 13,000 flights in that region. So they are highly degraded. Is it enough is the question? And is it enough to what the president keeps basically saying he wants them to surrender surrender their nuclear program, come to come some kind of deal? Who knows?

Who knows? We hear different descriptions. It's being mediated through Pakistan. See, Wyckoff is in charge. D.D. Vance is involved. I don't know what the framework for a deal looks like at all. What I do know is the goal is to make sure they cannot keep bombing people in the region. They cannot keep sending missiles out.

And now we've learned that they have much more ability to project much farther than they did when they tried to attack Diego Garcia. They'd always said that their ballistic missiles couldn't go that far. Well, guess what? Now we know they can. So I think the administration and the rest of the world gets nervous as well as to, okay, just what is left there? Well, we got about six hours to the 8 o'clock Eastern Time deadline that Trump has imposed. Again, we do not know what may happen, what will happen.

The world, I think, Joe, it's fair to say, is going to be watching. And to your point, there are things that trade almost 24-7. And nowadays, any positioning you're making between now and tonight? We actually looked at the options market. Maybe have puts or calls for 24 hours, even 48 hours, whatever it might be. But the cost of those people is so now expensive. The volatility with regard it is just so expensive. It didn't necessarily make sense for us to do that.

Plus, we're really investors that do a decent job of paying attention to our portfolio and we'll adjust them when we need to. We're not like crazy traders. So we looked at that this morning. We don't think that makes sense. But we will be ready to either add to the short or cover the short and maybe add to a long if something good or bad happens tonight. Anything in the middle of that, we stay pat. All right.

We'll leave it there. Thank you both so much for your time. Michelle Cruz. So Cabrera, Joe, actually, we'll see you a little bit later in the show. I really appreciate you being here. Yeah. And just a quick reminder, folks, you can sign up for our forthcoming energy-related newsletter called Power Insider. It's going to be a weekly piece, key news, meeting power players and more.

It's going to launch next week, April 4th. 15th. Use the QR code. Sign up today. All right, coming up and exclusive with Transportation Secretary Sean Duffy. Phil will be speaking with him. What about Jetfield? Is there a risk of shortages here? I'm sure there's a lot to do. At first, we've got a news update on Anthropic. That'll be right after. You have a news alert on Anthropic announcing a new cybersecurity initiative. It involves partnering with some of the biggest tech companies. Kate Rooney is here from San Francisco. Go, Kate, anytime they make news like this, you've got to watch shares of the publicly traded names. Kelly, today it's going to be cybersecurity stocks that we should watch.

So Anthropic is rolling out a new advanced AI model specifically for cybersecurity. It is only available to a select group of companies, tech companies, because the AI company says it fears it could be used by bad actors for nefarious use cases. It's called Project Glasswing. The market had been anticipating this after a publicly available description of the model had been found. by Fortune last month. Cybersecurity stocks, the I-Share cybersecurity ETF, did take a hit on that

report about this model leading up to all of this. Right now, the model, as I mentioned, is only available to 40 companies. You've got Apple, Google, Microsoft, NVIDIA, and Amazon, AWS, specifically for defense security work. CEO Dari Amadeh said in a video provided by the company

that the model wasn't specifically trained to be good at cyber. Quote, we trained it to be good at code, but as a side effect, it is also good at cyber. goes on to say, quote, more powerful models are going to come from this company and from others, so they need a plan to respond to this being the cybersecurity risk. It says that they have spoken to officials across the U.S. government and have offered to collaborate on this. But it does come at a tense time for this company with the U.S. government as it's battling back and forth

about that supply chain designation, risk designation, guys. Right. And I think, Kate, we've seen that when they make inroads and claim to have these cybersecurity capabilities, it does put the whole industry on notice, but I don't know quite how these would measure up with what's currently out there. It's right. Well, they're also partnering with some of the companies that also do cybersecurity.

I would mention, though, in this blog post, they said that they found thousands of vulnerabilities in some of the existing code out there. Talked about state-sponsored actors, which is top of mind, of course, with everything going on with Iran, and they really are looking to partner with these companies, and it's sort of this double-edged short

where we talk about the power of these models, the capabilities for coding and software. We don't talk a lot about the downside and the risk here. And these companies keep reminding us. That is very much one of the big risks as we talk about AI is cybersecurity and companies, including Amazon, and we spoke to earlier at this conference where we are, they're really worried about it. And they're really having to invest in it and spend to make sure that kind of the good guys

are better equipped than the bad guys, to put it simply. Yeah, absolutely. Kate, thanks very much for now. Appreciate it. Kate Rooney. Thanks, Cal. All right, back to Stocks. and the market. One of your big calls of the day, we're going to tell you what it is,

who it is, and the analyst behind it. There is other stuff going on. We've got it right after this. Welcome back. UBS says it's time to scoop up shares of Morgan Stanley calling it best in class and financials, saying it's resilient in the face of these headwinds like the Iran War and these risks in private credit. Analyst upgrading the stock to buy with a price target of 196 today. Morgan Stanley shares have soared 65 percent. in the past year, outperforming the broader market that's up about 13%. For more, is the analyst behind the call. Erica, Nigerian. She covers large-cap banks and consumer finance at UBS.

Erica, it's great to see you again. I mean, let's just kind of set the scene here. It's been a tough stretch for financials all of a sudden. Do you have a comment on that before we dive into Morgan Stanley in particular? Yeah, absolutely. Look, I mean, first of all, we had the concerns over, you know, disruptive employment. sort of backrop from AI. And then you give way to a poor February jobs print, and then you give way to the conflict in the Middle East. But honestly, just taking a step back, if you think about

what's going right in banks, you have capital markets, activity being robust, you have direct lending actually going strong. And the consumer is still spending. And so while the stocks are down, the estimates are actually flat to higher. And we thought that, you know, why not take advantage of that down draft to recommend adding quality in portfolios. And that's how we came to upgrade Morgan Stanley today. Right. And we can definitely get into that. And kind of the larger point being, is this down draft happening because of one-off factors where you can look back in five years and say, wow, what a great opportunity to kind of, you know, get in on this winning franchise? Or are we going to look back and go, well, geez, now we're in recession?

Look, I mean, who knows how long the Gulf conflict is going to last, right? And then, you know, we certainly then would be in a more visible path for recession. But even in that case, Kelly, then Morgan Stanley is definitely the most resilient among the stocks that I cover. So yes, while, you know, there could be, you know, events that would precipitate, you know, a longer conflict, I think Morgan Stanley's defensibility would still be best in class, even in that situation. I think of them as being a really strong asset manager.

I don't know if there's any threats there kind of from AI or what have you, or even literally from some of the private credit stuff. You know, there's obviously kind of capital market stuff to talk about, maybe some big IPOs coming and that sort of thing. How do they stack up against J.P. Morgan Bank of America? So they're definitely best in class, I would say. And let me just parse out some of the topics that you mentioned. You know, first on, you know, wealth management, asset management in AI.

You know, I think Morgan Stanley is absolutely best in class in terms of the ability of seeing the future and not being afraid to disrupt itself. So case and point, they bought e-trade a while back when they said, okay, you know, something is changing in terms of the way we're going to gather assets. And so if AI becomes a bigger part of how, you know, entry-level clients start engaging, you know, in terms of managing their wealth, Morgan Stanley will be at the forefront of it, either developing their own technology or buying superior technology. On the, you know, capital markets front, you know, software is only 6% of Morgan Stanley's pipeline. So I think they're going to be significant participants in some of the activity levels that you're seeing,

particularly given the blockbuster IPOs that we're anticipating. And, you know, on the private credit side, we're not really worried about sort of any sort of spillover with regards to the company itself. And the company's always been very cautious about, you know, selling alternatives into retail and making sure that suitability is really the primary focus for us before distribution. And so for the sector, and appreciate the granularity there then, Erica, would you say for the sector broadly that, you know, be comfortable with people adding exposure here? Or is this kind of more of a Morgan Stanley specific story? No, absolutely. We finally got a chance to get a little bit of a better price for Morgan Stanley. But, you know, to this end, the stocks are down, but the estimates are

up, especially for the G-Sibs. And the deregulatory momentum. continues to be very strong from Washington. So yes, for the big U.S. banks, we do think this is a buying opportunity ahead of what we're going to think will be a pretty strong quarter. All right. Shares of Morgan Stanley down 5% year to date. Erica, thanks for joining us on the back of that. We appreciate it. Thank you.

All right. Now it's time for a quick bond report. Steady yields here. 10 years about 4.34%, though you heard earlier in the 1 p.m. show, the exchange with Kelly Evans. check it out, that mortgage rates have been kind of on the move higher. It's not exactly a great spring selling season. Things are a little different overseas, maybe a little bit worse. The 10-year German yield approaching 310 in early trading.

Last time we saw that was last March. And in Japan, 10-year holding above 240, doesn't sound hot to us, but it's their highest trading level since 1998. Yields globally on the way up. Important point. Next, what is the real state of air travel? Are your flights at risk? Transportation Secretary Sean Duffy joins Phil Aboe to talk about that very topic next. All right, you can see the Dow is down 197 points for about four-tenths of 1% all as we approach tonight's 8 p.m. Eastern Time deadline that Trump has imposed on Iran.

All right, in the meantime, let's talk about all things flying and transport related and get right down to Phila Bow, who's with Transportation Secretary Sean Duffy in an exclusive. Bill. Thank you, Brian. Mr. Secretary, good to have you here. What a backdrop, too. Yeah, isn't that fantastic, right? We'll talk about this in a bit, but let me first start with, we're a couple of weeks removed from the crash at LaGuardia.

And once again, it's highlighting air traffic controller staffing, and staffing at all airports. You're making the big push. How close are you to making a real indent in that deficit of air traffic control? So I'll say, too, it's number one staffing, and the other part is technology. regard to staffing, we had the biggest year of hiring in six years at the, at the air traffic controllers. So we hired 2,400 new controllers in the last 12 months. We have more controllers

for the first time since pre-pandemic. We have big classes coming through. Next week we're going to announce a new class of air traffic controllers. We're thinking differently. We have a 30% washout rate. So how do we bring that rate down? Again, we want to have a washout rate, but 30% is too high, getting the right young adults to get into. the school is what we're thinking through right now. So that part is going well. We still have a deficit. I've also included those controllers who are eligible to retire. I'm offering them a 20% upfront cash bonus to not retire to stay on the job. But when we look at LaGuardia, again, we had two controllers in the tower, but I'm looking at how do I update this system to make sure

we have the best technology? So humans can always make airs. So how do I have great air traffic controllers and I backed them up with great, great technology. I got $12.5 billion that I'm working on right now. The next two and a half years, we're going to spend that building out. We're going to have new telecom. We're going to have new radar, new voice switches. But the next part is we need new software to manage the system. Congress has to give me money for that. Let me ask you about what's on top of mind for most people who are traveling right now. Higher airfares because jet fuel prices have almost doubled since the beginning of the year. Two questions here. One, should we be worried about the jet fuel supply, given the fact that there's not oil flowing through the Strait of Hormuz, as we usually see?

And two, what do you say to the people who are looking at these airfares and are saying, wait a second, I can't take my family to California this summer? It's ridiculous. That's a good question. So thanks to President Trump, you know, in American energy dominance, we have a ton of energy in the U.S. So we are less reliant on the Strait of Hormuz than we would have been, say, 25, 30 years ago. of fracking. I've talked to all the airline CEOs and I've talked about their supply for jet fuel. They have a deep supply chain. They all feel really good about the supply, but it's a global market, right? So when global jet fuel prices go up, that affects us here in the U.S. And I think we have to think about it, you know, this is short term. The president thinks about this short term. And we do have a blip in an increase in prices. But in the long run, if we bring more stability to the supply of oil and gas, globally, I think we're going to be better off as a country,

but also as everyone purchases this great energy. Because of these jet fuel prices and costs for the airlines, let's be honest, you've got two airlines that are bulk of the profits, and the other airlines are all struggling. Nobody's going bankrupt. But there is growing chatter in the industry that perhaps one of the big four airlines gets even bigger and buys one of the smaller airlines. That would have to meet with your approval. Would you like to see one of the larger airlines buy one of the smaller airlines? Listen, that's going to come through us, but also President Trump, he loves to see big deals happen.

He'd have to review that kind of a deal. It has to go through DOJ and it'll come through DOT. I think who knows who's going to match up, right? There's always chatter, but is there room for some mergers in the aviation industry? Yeah, I think there is. Even here in the United States? Yeah, yeah, I think so. Now, again, there's a lot of chatter, and a lot of different people are talking, you know, amongst themselves about what that should look like.

I'm going to wait and see, is there a deal that's brought to the table? How does it look? What impact does it have on competition? What is it going to do for the consumer and the pricing of the consumer? What does it do for us to be competitive globally to make sure that we are in America have the biggest and the best airlines competing around the world? But what if that means one of the airlines no longer has just 20 percent, and the big four, all around 20 percent? market share, what if they go up to 30%, 35%, would you be okay with that? Well, again, we have to look at a case-by-case basis. And, again, if there was a merger between some of the larger airlines, they're going to have

to peel off some of their assets, right? We don't want to have, you know, this massive infrastructure with one airline in America. Again, I think that will affect pricing in the long run because there would be a lack of competition, which we love competition. So, again, I'm not going to pre-commit to anything. I'll look at whatever comes across my desk. Another president will look at that as well. Quickly want to ask you about why you're here today, taking a tour of the Dreamliner production line.

They're going to go up to 10 per month production, at least they hope to by later this year. You've been at a lot of the Boeing facilities. How much have they improved relative to where they were a year and a half ago? I think there was a lot of frustration at Boeing. You go a few years back. And I think now what we see is a lot of Americans are cheering them on. We do our job as we do oversight with the airline and have strict controls on how many aircraft they can produce. per month, but we have seen them take leaps and bounds of steps in the progress in their

manufacturing capability and the training and the way they're performing, building these airplanes. So they're in a great place, but we're crawling, we're walking, we're taking our time, but they continue to get better every single day. This is the greatest export of any company in America. This does more to offset our trade imbalance Boeing than any of the company. So what we build here, whether it's in Washington or here in South Carolina, is sold around the world. This is great American manufacturing, American innovation. And I'm proud of them.

I think this is a comeback story for Boeing, and they're doing a great job. Transportation Secretary, Sean Duffy. It's good to have you here. It's good to see you. Thank you. Heck of a backdrop. Can't beat it. It gets better looking all the time.

Yeah. Send it back to you guys. Gentlemen, thank you both. Really appreciate it, Philo, Secretary Duffy. Let's get over to Angelica Peoples now for the CNBC News Update. Hi Angelica. Hey, Kelly, American journalist Shelley Kittleson, who was abducted in Baghdad by an Iranian-A-Line militia, will be freed today after a week in captivity.

Kittleson, who has reported on the Middle East for various outlets, was set to be released in exchange for several imprisoned members of the militia that was holding her. Used car prices are now at the highest point since the summer of 2023. According to Cox Automotive, prices are rising amid relatively tight supply, but demand remains strong. The average list price in February for a used car was $25,000 compared to $49,000 for a new car. And the crew of the Artemis II captured what NASA's administrator called an absolutely stunning photo of the moon eclipsing the sun. The astronauts took this picture from their Orion Space capsule, which made a six-hour flyby of the moon yesterday. NASA chief Jared Isaacman

told CNBC this morning that this is why we send astronauts farther into space. space than ever before. Brian, back over to you. That is a very, very cool photograph, best to them. And thank you to the Artemis crew. All right, coming up, maybe a little good news. Your next guest says oil prices may fall faster than you might expect. And he's got two ways. You can play that trade. Your market navigator is next. Welcome back to Power Lunch. I'm Dominic Chu. Higher energy prices have put a dent in the budgets of many Americans out there. But once they do come down and people have a little bit more money to spend, who could benefit the most from that? Our next guest has some specific ideas about the companies to focus on. Joining us now

as Chris Brigotti, Chief Investment Officer over at SWBC. So Chris, when those oil prices do come down and hopefully it's sometime soon, what exactly would you be focusing on from that kind of consumer discretionary spending standpoint? point. There's some consumer discretionary standpoint is the types of stocks that can benefit because people basically have more money in their pocket. And one of those ideas is chewy, the pet food and pet supply company. They're very well positioned. And they've actually got a good entry point right now. So if you're looking at an opportunity for something that's going to benefit when people have more money to spend, this is the type of stock that will. People spend about $1,000 on average

of disposable income on their pets each year. And so when they're ready to spend again, this is one way to take advantage of that. And do you feel as though the price action right now is conducive to starting to leg into positions in Joey? I do. I do. I think we've seen a little bit of a hit because of the higher oil prices affecting people's wallets and pocketbooks. They don't have as much of that disposable income. So the prices come down a little bit. So part of this is going to be a bounce back and then it's going to be upside potential, just getting back to normal pre-oil crisis, for lack of better way of putting it. And where else would you go where you would try to find a dip to buy bigger picture-wise outside of, say, pets?

This one, it's kind of obvious to me that it's things that people kind of pair back from when they don't have money to spend and it's traveling destination. And so one of those ideas is Disney Company. So, you know, they kind of come down in price a little bit of late. Again, same story is chewing and that people don't have this much money to spend. So they pair back on this kind of spending. Now, now everybody does. One of my golf buddies, Oprah and Knickerbocker just came back from Disney. And they're spending money down there for sure.

But the opportunity for this bounce back is going to be beneficial. in the long run. And I think one of the things we can see is the price going up meaningfully from here. All right. So Chewy and Disney, the places you could go for that consumer spending picture. Chris Pagotti, thank you so much. We'll see you again soon, sir. Thank you. All right, Kelly, I'll send things back over to you. Don, thank you very much. Coming up, Brent, above 100 barrel 109 WTI, now below 100. What does it all mean for you? We'll dive further into the oil prices right after this. All right, Dow's down about a half a percent. Not a huge move there. But the

energy market, it remains on edge. It, like the rest of the world, is waiting for any new developments out of the Middle East. WTI's June contract, June, suffering around $100 a barrel. The May contract, about 115, Brent Crude is trading nearly on the flat line. And we've got just over five hours left before President Trump's ultimatum expires. Still no confirmation on whether Iran will allow full tanker traffic through the Strait of Hormuz. That, a live tracking feed of vessels in that choke point, data from Kipler and our friends at Marine Traffic Show. Just seven ships made that transit yesterday.

Three sanctioned vessels. Now, seven is more than zero, but it's still well off where it was. Let's talk more about energy and gasoline and diesel. Joining us, Patrick DeHan, head of petroleum, Manalysis is a gas buddy, and Joe Mowgli is back with us, executive chair of Greenland, a Greenland-focused energy company, Joe. Good to have you back on as well. Patrick, I want to stay focused on diesel in the middle of the country.

Again, paying about a buck more gallon for gasoline than they were one year ago. That's a pain, probably a little more manageable for most families. But on the coasts and with diesel fuel, especially in places like California, it's getting a little bit out of hand. Yeah, certainly, Sully. And to your point, something developing here in the last couple of hours is a big jolt is about to come to those in-law. areas. As we see a little bit of an equalization, the ARB's closing a little bit. It looks like product may be flowing away from some of those plain states, and they could see diesel prices now jumping 35 to 65 cents in those cheap states like the Dakotas in the nation's section. These states there

are going to now start catching up to that surge we've been seeing in diesel nationally. We're right now at about 563 a gallon for diesel and solely, I think in the next 72 hours, we'll be setting a new all-time record high when it comes to the average price of diesel. I guess, Joe, the question, Joe Mowgli is, and you're involved with the company, it's a microcaps. We won't talk about the stock, but you're involved in a Greenland-focused energy company. Look out next year, three years, five years. How does what's happening now and all the stuff we just talked about with the straight-of-form Moos, a little bit around Bobo Mandeb, the Middle East, how does that change how we should think

about energy investing? I think we live in an age with geopolitical stress, is. as great as we've ever seen in the span of our lifetime. The center of that is energy. It always seems the energy becomes the focus point about so many things that are going on in the world. I think more than ever, I think we've got to think about how we're going to diversify where we're going to get our energy energy from. So you think about Greenland, there's an example.

Greenland is at the intersection of geopolitics and energy. I want to go back a little bit to 1980s and 1990s. And when Arcoe, Atlantic Richfield, spent about 15 to 20 years and 275 million, dollars in today's dollars in terms of geological exploration. They were pleased with what they found, but from a business perspective, oil price of the 80s and 90s were crazy, and the country of Denmark took a 35% premium off the top of their revenues. They got to the point where they could handle it from a business perspective.

They fired 12,000 people. They got out of there. But the geological fines that they found was very, very, very real. the only company in the world that has rights to be able to drill in the Jameson Basin in Greenland is Greenland Energy. That's part of the reason why he'd gotten involved with them. So the potential there's 13 billion barrels. They're the only people that could possibly do that. They're going to start.

Now, again, as you pointed out, Brian, they're small and they're not going to have a good thing. Yeah, I don't want to talk about that stock. No, longer term. No, longer term. I'm not talking about the stock of it, but longer term. this is the type of thing we need. And the potential there's 13 billion ballots. Is your interest there related to the president's interest or completely unrelated?

It's unrelated, but because of the situation that happens to be in, it's a choke point for where missiles are going to be flying over. So if we had a successful business there five years from now, let's say, wouldn't it be in the United States best interest to make sure we had some sort of military base just to protect our businesses that are there? And by the way, this is a partnership with the country of Greenland as well. So I think from a strategic perspective, that could be a major, major plus to something like this. Well, and we're looking to get away from choke points like the straight in it. You know, like Bryant has pointed out many a time, at least Saudi Arabia because of the Iran-Iraq War, they have all these pipelines. So there's another way to get product through that choke point.

But, you know, we're still short about 10 million barrels a day. So we need to get all of that supply back in the market. And I don't know. That's what this all really comes down to. I agree, Calab. That's the reason why we have the dilemma we have. That's the reason why a small little country like Iran can almost hold the world hostage because of this. Yeah. So that's the issue.

And that is the issue, Patrick. And I think the point around Greenland and whatever else it is, is will we, do you think that in a year from now, two years from now, we're going to change how we look at acquiring energy, where we acquire energy, or when this is over, however that may be, whenever that may be, we're going to go back to just doing it. the way we were doing it before because it's over. And in five years, 10 years, 20 years, we might be here again because we do seem particularly with energy to relive the past over and over again. Yeah, Brian, I think, you know, some excellent points being made here. And to Joe's point, geopolitical tensions, you know, whether they're overseas or even in the United States,

you look at where the investment money is flowing. And it's to the lowest risk areas. you look at a place like California, which has isolated itself through rules and regulation, refineries are leaving the state because the environment for operating refinery in that state just continues to close in. It's not a profitable place. If you have a small refinery, there's so many rules there that now you're seeing investment from some companies like Sinclair and Kinder Morgan, Phillips 66, and One Oak. California has become such a difficult logistical challenge and a nightmare to operate in that you're not. seeing three pipelines that want to connect areas of the nation's interior, whether it be Oklahoma or Texas, those pipelines could potentially flow east to west, much like the Saudi pipeline that

is now diverting around the Strait of Hormuz. So even here in the United States, you have a little bit of a subset of the same problems. Political views are dictating where the investment is flowing to. You look at some of the biggest refinery expansions in recent years. They're down in Texas. So we're very politically fractured here by where the investment is flowing to, and that's creating a lot of hotspots. You look at Arizona. Arizona estate now completely reliant on essentially California and a little bit of flow of oil and gasoline, diesel and jet fuel from Texas. But a lot of this, you know, global picture also happening in a microcosm here in the United States. Yeah.

And again, as we see along the West Coast, we have prices over $5 on average. Patrick, thanks very much. Patrick DeHan of gas buddy. Joe, thanks as well. Joe Muglia. Kelly. Dow's down 308. More power lunch after a quick break. All right. There is a lot of serious stuff going on right now. Got a couple hours to that Trump deadline. But Joe Mowgli is still with us. And in the last couple of minutes we have together, one that put on that cap, that big cap here is one of many that you've had running. You ran TD Ameritrade, but you also were college football coach.

Very successful one, by the way, at Coastal Carolina. You also did an internship at the University of Nebraska. By the way, I hate to say it, congratulations to Michigan last night, winning the national basketball title. I have been pretty open on my daughter as a former D1 athlete. I know you played college sports. Kate Rooney did as well. How broken is college sports right now with money? Well, it's a mess.

As an example last night, a great, great NCAA series. Great game. Michigan, all five starters, everyone was a transfer. So when you think about now, it's still a great product. They still get a lot of television. They get all those things. But it's a business now. it is totally a business in academia and the NCAA, frankly don't know how to run it as a business.

So I think I applaud the president for coming out with his executive order. I think that's just the step in the right direction. There's probably going to be legal conflicts associated with that. But I think the only way there's going to be a long-term fix is that it's a business running like a business. So I think you've got to take power for football. That's where a lot of the money. Most of the money is. You break it away.

And instead of the NCAA, they become the PCAA, the professional collegiate athletic association. Wow. They model themselves after the NFL, which, by the way, if the NFL ran themselves like colleges today, they go out of business. So it's a great business. So you use them as a model. That means you have real, real management. You have real contracts that matter. You have salary caps.

You have collective bargaining. You're running like a business. I think that could potentially be a home run. You got the Super Bowl. You've got the PCAA National Championship. Then the group of five schools, that'd be the NCAA National Championship. And then maybe you do it for a group of five schools or you do it with basketball. But right now, to fix everything at once,

you're not going to be able to do it. Can I go for option B, just go back to the way that it used to be? I guess that's not on the table. Joe, you're smart about all the stuff. What's your take on prediction markets, which have turned into a conduit for sports betting for kids who aren't technically old enough to get old. I think legalized betting, I think everybody bets.

So I think to be able legalize that, I think is the right way to go. I think anything, AI, right? We talk about AI and the tremendous impact that can have, maybe to find greater energy sources for us. but there's going to be disruption, right? With regards to the prediction markets, you can abuse those. And that's part of what's happening now. So is there a way to be able to have those and still be able to maybe temper some of that?

Hopefully. I think that's the way they're going. Listen, 10% of Joe Mowgli is 100% in most people, so we're glad to have you on. Joe Mowgli, thank very much. Great conversation there. Folks, that's it for us. Thank you very much for watching Power Lunch. As stocks head back towards session lows, closing bell picks things up right now.