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Financial stability risks are rising as AI fuels cyber-attacks, IMF warns; oil below $100 on Iran peace hopes – business live | Business
IMF warns AI tools such as Mythos threaten financial stability
Newsflash: The International Monetary Fund is warning that financial stability risks are rising as artificial intelligence fuels cyber-attacks.
In a new blogpost, just published, the IMF singles out Claude Mythos as an example of how quickly risks are increasing.
The Fund is calling for “resilience, supervision, and international coordination” to safeguard global financial markets, and protect them against attackers with new AI tools.
It warns that AI tools such as Mythos can “dramatically” cut the time and cost needed to identify and exploit vulnerabilities, which raises the risk of weaknesses in key systems being discovered and exploited.
IMF experts Tobias Adrian, Tamas Gaidosch and Rangachary Ravikumar write:
Mythos could find and exploit vulnerabilities in every major operating system and web browser—even when used by non-experts.
This foreshadows how fast‑moving, AI‑driven cyber risks could destabilize the financial system if not managed carefully, and why authorities must focus on building resilience through supervision and coordination—rather than treating these developments as purely technical or operational issues.
AI firm Anthropic announced the existence of Mythos on 7 April but said it would not be released publicly because of its ability to identify unknown flaws in IT systems, which could be exploited by hackers.
But on 22 April Anthropic confirmed it is investigating a report that unauthorised users have gained access to Mythos
The IMF says “The Mythos episode” highlights the governance challenges surrounding AI, explaining:
Cyber risk does not respect borders. As AI capabilities spread across countries, inconsistent oversight could weaken a globally interconnected system.
The Fund is also concerned that emerging and developing economies may be disproportionately exposed to attackers targeting regions with weaker defenses
Key events
In its new blogpost, the IMF cites three ways that AI‑enabled cyber tools threaten financial stability:
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Risks are systemic. Attacks become more dangerous when discovery and exploitation scale rapidly, with implications for financial stability.
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Risks cut across sectors. The financial sector shares digital foundations with energy, telecommunications, and public services. That means AI‑assisted attacks can propagate across sectors that rely on the same infrastructure.
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AI may further concentrate risk and failures with one vulnerability rippling across many institutions. Reliance on a small number of software platforms, cloud providers, or AI models increases the impact of any single exploited weakness.
IMF warns AI tools such as Mythos threaten financial stability
Newsflash: The International Monetary Fund is warning that financial stability risks are rising as artificial intelligence fuels cyber-attacks.
In a new blogpost, just published, the IMF singles out Claude Mythos as an example of how quickly risks are increasing.
The Fund is calling for “resilience, supervision, and international coordination” to safeguard global financial markets, and protect them against attackers with new AI tools.
It warns that AI tools such as Mythos can “dramatically” cut the time and cost needed to identify and exploit vulnerabilities, which raises the risk of weaknesses in key systems being discovered and exploited.
IMF experts Tobias Adrian, Tamas Gaidosch and Rangachary Ravikumar write:
Mythos could find and exploit vulnerabilities in every major operating system and web browser—even when used by non-experts.
This foreshadows how fast‑moving, AI‑driven cyber risks could destabilize the financial system if not managed carefully, and why authorities must focus on building resilience through supervision and coordination—rather than treating these developments as purely technical or operational issues.
AI firm Anthropic announced the existence of Mythos on 7 April but said it would not be released publicly because of its ability to identify unknown flaws in IT systems, which could be exploited by hackers.
But on 22 April Anthropic confirmed it is investigating a report that unauthorised users have gained access to Mythos
The IMF says “The Mythos episode” highlights the governance challenges surrounding AI, explaining:
Cyber risk does not respect borders. As AI capabilities spread across countries, inconsistent oversight could weaken a globally interconnected system.
The Fund is also concerned that emerging and developing economies may be disproportionately exposed to attackers targeting regions with weaker defenses
US stock market hits new highs
Zing! The US stock market has hit new record highs at the start of trading in New York.
With the oil price falling, hopes of a US-Iran peace agreement are spurring shares higher.
The S&P 500 share index has reached a new peak of 7,376 points, while the tech-focused Nasdaq Composite also hit a new high.
Oil price hits two-week low on Iran deal optimism
Brent crude has now sunk to its lowest level in over two weeks.
The benchmark oil measure is now down 5% today at $96.19 a barrel, its lowest level since 21 April.
Investors appear to remain hopeful that Iran might give a positive reaction to the peace deal proposed by the US yesterday, after US President Donald Trump predicted that the war in Iran will be “over quickly”.
Fawad Razaqzada, market analyst at Forex.com, explains:
The latest developments surrounding Iran have kept investors focused firmly on the risk-on trade.
Reports indicate Tehran is reviewing a US proposal that could eventually lead to the reopening of the Strait of Hormuz, while broader nuclear discussions may be delayed until later stages. At the same time, President Donald Trump has continued to strike a relatively optimistic tone, suggesting a deal could potentially be reached within a week ahead of the upcoming summit with Chinese President Xi Jinping on May 14-15.
The number of Americans filing new claims for jobless support has risen, but remains low.
Last week there were 200,000 new ‘initial claims’ for unemployment insurance, up from 190,000 in the previous week.
That’s lower than expected (economists forecast a rise to 205,000), and suggests US firms are still holding into workers despite the jump in energy prices since the Iran war began (although the Challenger jobs report earlier suggested job cuts were rising….)
Oil near two-week low
Oil is dropping closer to a two-week low, as Iran continues to ponder the US’s latest peace proposal.
Brent crude is now down more than 3% to just over $98 a barrel, near the lows seen yesterday after Tehran said the strait of Hormuz could reopen under new procedures.
There don’t appear to be any major breakthroughs yet, but key mediator Pakistan remains optimistic.
The Pakistani foreign ministry spokesperson, Tahir Andrabi, would not disclose details of the ongoing diplomatic efforts but said a deal could be reached soon.
He told a news briefing:
“What I can tell you and this is what I have stated before that we remain positive, we remain optimist, and we hope the settlement will be soon rather than later.”
Our Middle East crisis liveblog has the latest developments:
Sterling is having a calm election day.
The pound has gained 0.15% against the US dollar, which is generally weaker amid hopes of a US-Iran peace breakthrough.
The UK currency could be more volatile tomorrow as local election results from England, Scotland and Wales are announced.
There are forecasts that the Labour Party could lose as 1,800 council seats, or 75% of the seats it is defending. The worse the result, the greater the pressure on prime minister Keir Starmer – potentially creating fresh political instability.
Malaysia has joined the ranks of central banks leaving interest rates on hold while it assesses the impact of the Iran war.
Unike Norway, which hiked borrowing costs today (see earlier post), the Bank of Malaysia left its Overnight Policy Rate unchanged at 2.75%.
It also warned that sharp increases in energy and commodity prices from the Middle East crisis, and supply chain disruptions, are beginning to hurt global growth momentum, adding:
Downside risks to global growth remain elevated stemming from the uncertainties surrounding the length and severity of the conflict, tighter global financial conditions and concerns over valuations in financial markets.
The surge in building materials costs following the Iran war may make some UK construction projects unviable, warns Kelly Boorman, national head of construction at audit, tax and consulting firm RSM UK:
“Today’s figures show sentiment in the sector has fallen significantly as the industry braces for the impact of the Middle East conflict. Mobilisation is slowing as UK construction faced cost pressures on slim margins further challenged by the weakening economic backdrop.
“Pipelines are currently strong, particularly for large infrastructure projects including defence, healthcare and data centres. There are however some significant challenges around reassessing the viability of projects and extending mobilisation start dates, as oil price increases hit the supply chain, increasing material and fuel costs.
“With the increased volume of infrastructure projects committed to in prior years, outputs remain strong. However, local elections this week could cause further uncertainty among contractors around where future infrastructure spending will be focused. Uncertainty around planning decisions and concerns around new work to replace completed projects in April could create a shrinkage in the pipeline in the future that will create further instability for the industry. There is a significant risk that some planned projects will become unviable in the current economic climate, particularly for long-term fixed price projects, so we may see some large infrastructure projects put on hold.
Barclays’ AGM disrupted
Pro-Palestinian and climate protesters have interrupted the opening minutes of Barclays’ annual general meeting in Westminster, London, PA Media report.
The disruption broke out as chairman Nigel Higgins delivered his opening remarks, with several protesters standing up holding Palestinian flags and shouting “Free free Palestine”, “Everyone here is profiting from genocide” and “Barclays bank, you can’t hide, you’re supporting genocide”.
Mr Higgins responded that the board had “heard your point” and would take questions on the topic during a later Q+A section.
Security staff escorted, and in some cases carried, the protesters out of the meeting room as they continued shouting.
A few minutes later, climate protesters rose from their seats at the AGM and started singing: “Stop, in the name of love, before you break this Earth.”
One shouted:
“This bank is financing the climate and nature crisis that we have to stop. Softly-softly, slowly-slowly is not good enough. You are endangering life on Earth.”
China’s central bank loaded up on gold for an 18th straight month in April, Reuters reports.
They cite data from the People’s Bank of China which shows that China’s gold reserves rose to 74.64m fine troy ounces at the end of April, up from 74.38m at the end of March.
The total value of China’s gold mountain has risen too – to $344.17bn, up from $342.76bn a month earlier. The gold price stabilised in April after falling by 11.5% in March.
A motorbike and BMW car crashed early on Thursday, with three people arrested.
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Nathan Gothard knocked David Darke to the ground days before Christmas last year.
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UK News
Rubio meets Pope Leo in bid to ease tensions after Trump’s criticism of the pontiff – Europe live | World news
Rubio leaves after meeting with Pope Leo amid tense relations between Vatican and US
Meanwhile, US secretary of state Marco Rubio has now left the Vatican after meeting Pope Leo after some two hours there.
He met initially with the pontiff before sitting down with senior Vatican officials, including top diplomat Italian cardinal Pietro Parolin, Reuters reported.
The Vatican and the US state department did not provide any immediate details about the talks.
I will bring you more if/when we get it.
Key events
Airlines still have to pay compensation if flights cancelled due to fuel crisis, EU says
Lisa O’Carroll
Airlines that cancel flights because of fuel shortages this summer will still have to compensate passengers under European law, the EU transport commissioner has said.
Apostolos Tzitzikostas told the Financial Times that jet fuel prices or shortages do not meet the criteria that protect EU airlines from passenger claims.
“The price of jet fuel is the reason why we have cancellations of flights and if they cancel flights without extraordinary circumstances – jet fuel prices are not extraordinary circumstances – they will have to reimburse the people,” the commissioner said.
Although the EU law remains in place in the UK post-Brexit, Keir Starmer’s government is free to take a different position. Last week, it emerged that penalties for airlines that cancel UK flights because of jet fuel shortages have been eased.
Ryanair, the biggest airline in Europe, said this week it would not be cancelling summer flights because it had hedged its fuel contracts before the Iran war broke out.
However, other airlines have cancelled flights, including Germany’s Lufthansa and Ireland’s Aer Lingus.
Tzitzikostas’s remarks came as the boss of a large airline in Asia said the fuel crisis was worse than the Covid pandemic, when planes were grounded amid global travel bans.
“I thought I’d seen it all with Covid … but having seen jet fuel go up almost three times – this is much worse,” Tony Fernandes, the chief executive of AirAsia, told the Financial Times.
Rubio leaves after meeting with Pope Leo amid tense relations between Vatican and US
Meanwhile, US secretary of state Marco Rubio has now left the Vatican after meeting Pope Leo after some two hours there.
He met initially with the pontiff before sitting down with senior Vatican officials, including top diplomat Italian cardinal Pietro Parolin, Reuters reported.
The Vatican and the US state department did not provide any immediate details about the talks.
I will bring you more if/when we get it.
‘Considerable progress’ made in EU talks on finalising trade deal with US
Lisa O’Carroll
“Considerable progress” was made in crunch talks with MEPs to finalise the US trade deal that has been on the table since last summer, Maroš Šefčovič, the EU trade commmissioner has said after six hours of talks last night.
The so-called “trilogue talks”, involving the European Commission, the European Parliament and representatives of member states, are the final stage in the ratification system in the bloc, a process that is testing Donald Trump’s patience.
Although they failed to agree on amendments sought by MEPs, both the trade committee chair Bernd Lange and Šefčovič are indicating a compromise is not far off.
Talks last six hours, double the time scheduled for negotiations.
“This significant investment of time and effort suggests that we are making considerable progress and have already achieved a lot – although, of course, nothing is agreed until everything is agreed,” said Šefčovič.
He said in a post on LinkedIn that he had three objectives:
“To demonstrate that the EU is walking the talk and honouring its commitments”
To secure a result that fully respects the EU-US Joint Statement.
To preserve the interests of EU stakeholders, including by equipping the Commission with the instruments necessary to ensure that the EU-US Joint Statement is faithfully implemented by both sides.”
Last Friday Trump threatened to hike tariffs on EU cars this week, in contravention of the trade deal, in protest against the lengthy delays on the EU side.
The delays were partly a response to his foreign policy, with the European parliament twice pausing ratification process over his threat to increase tariffs in January, and then his threat to take control of Greenland.
MEPs are seeking three amendments to the implementation Brussels-side – including a sunset clause which will end the deal in March 2028 unless renewed, a sunrise clause ensuring the deal will come into force on the EU side if the US respects its commitments and a suspension clause.
Current evidence shows hantavirus continues to pose ‘low’ risk to Europeans, UN insists
Speaking at the European Commission’s midday briefing, the executive’s health spokesperson Eva Hrncirova insisted that the risk to Europeans posed by the new hantarivus remained “low.”
“According to the evidence that we have at the moment, the risk for the public in Europe, the risk for the Europeans is low. Health of the citizens in Europe is our absolute priority,” she said.
She stressed there was “no cause for concern,” and the EU was working closely with the World Health Organization and the European Centre for Disease Prevention and Control to monitor the situation.
EU will not leave Kyiv despite warnings of possible Russian strikes
Meanwhile in Brussels, the EU said it would not leave Kyiv after Russia warned of a possible retaliatory strike on the Ukrainian capital and urged foreign organisations to evacuate.
“As to us, the EU, we will not change our posture or presence in Kyiv. Russian attacks are… unfortunately, a daily reality in Kyiv and elsewhere in Ukraine,” EU foreign affairs spokesman Anouar El Anouni said in comments reported by AFP.
Russia’s public threats to attack Kyiv are part of its reckless escalatory tactics.
The European Union’s diplomatic mission in Kyiv was damaged in August last year after Russian missiles struck close to the building.
Hungary’s Magyar meets with Italy’s Meloni ahead of inauguration weekend
Meanwhile, Hungary’s incoming prime minister Péter Magyar has arrived for talks at Palazzo Chigi in Rome, where he is due to meet with Italy’s prime minister Giorgia Meloni.
Since he is not the Hungarian PM yet – he will take his role this weekend – he was officially welcomed outside the Palazzo by a senior adviser to the Italian PM instead.
Ukraine, international order, Europe’s push to arm part of discussions with Pope Leo, Poland’s Tusk says
Earlier today, Pope Leo welcomed Poland’s prime minister Donald Tusk in the Vatican, and going by Tusk’s press conference afterwards, it was a good geopolitical warm up act for the big transatlantic meet with Marco Rubio.
Speaking to reporters after the meeting, Tusk said the pair discussed a potential papal visit to Poland signalling 2028 as an option under consideration, but that a big chunk of their conversation focused on international affairs.
“Of course, the conversation was about Ukraine, … about the international order, the armament of Poland and Europe, and the armament of Germany. Well, you know how many hot topics there are.
As you know, I will also have a meeting with prime minister Meloni today and secretary of state Rubio is here too; he will have a meeting with the Holy Father right after me. So this also shows how much is happening and how difficult the issues are to discuss and solve.”
Later today, Tusk will also meet Italy’s Giorgia Meloni, who is also expected to welcome Hungary’s incoming prime minister Péter Magyar at some point today – and will see Rubio tomorrow.
Rubio arrives in Vatican for talks with Pope Leo – in pictures
Rubio arrives for two-day visit to see Pope Leo, Italy’s Meloni
Lorenzo Tondo
in Palermo
Meanwhile, the US secretary of state, Marco Rubio, is to meet Pope Leo at the Vatican on Thursday in an effort to ease tensions after Donald Trump’s repeated criticisms of the first North American pontiff.
Amid unprecedented strain on relations between the Holy See and Washington, Rubio is expected to meet Leo at the Apostolic Palace in the morning, before holding a series of meetings with the Italian government.
Trump on Tuesday accused the pope of supporting nuclear weapons and “endangering a lot of Catholics’’ with his stance against the Iran war, in the latest attack by the US president on the pontiff.
On Wednesday, Leo responded:
“If anyone wants to criticise me for proclaiming the gospel, let them do so with the truth: the church has spoken out against all nuclear weapons for years, there is no doubt about that. I simply hope to be listened to because of the value of God’s word.”
Rubio downplayed the rift between Trump and Leo and told reporters at the White House on Tuesday that the president’s recent criticism of the pontiff was rooted in his opposition to Iran potentially obtaining a nuclear weapon, which could be used against millions of Catholics around the world.
Trump “doesn’t understand why anyone – leave aside the pope – would think that it’s a good idea for Iran to ever have a nuclear weapon,” Rubio said.
Relations between the Vatican and Washington have never been so fraught. In April, the US president lashed out at Leo over the pope’s criticism of the war in Iran, branding him “weak on crime” and “terrible on foreign policy”, and claiming he had only been elected pontiff because Trump himself occupied the White House. Trump later shared – before deleting – an AI-generated image depicting himself as a Christ-like figure.
Rubio’s likely goal is to try to smooth over Trump’s insults and repair increasingly damaged ties between the US and the Vatican. According to several analysts, the secretary of state is expected to defend Washington’s rationale for launching the war in Iran, while carefully avoiding a direct clash with the church’s position.
Rubio will also meet the Italian prime minister, Giorgia Meloni, on Friday as relations between Rome and Washington have also deteriorated.
At a separate press conference with Latvia’s defence and interior ministers, we are told broadly similar things that the incident is still being investigated.
I will return to this topic if we get something substantially new.
Romania reports brief breach of its airspace by Russian drone attacking Ukraine last night
Meanwhile, Romania has just reported a brief violation of its airspace by drones taking part in a Russian attack on civilian and infrastructure targets in Ukraine last night.
The drone was monitored by two F-16 patrolling aircraft and tracked as it crossed into Romania’s airspace in the Chilia area, the country’s defence ministry said in a statement.
The ministry “firmly condemned the irresponsible actions of the Russian Federation, which contravene the norms of international law and pose risks to regional security and stability in the Black Sea.”
Flanked by senior police and army officials, the Latvian prime minister Evika Siliņa is just giving a brief update after this morning’s crisis cabinet meeting in Riga.
She says there is still no clarity on who directed the drones reported in the Latvian airspace, and this continues to be investigated.
She sticks to key lines that as she stresses that the incident is a consequence of Russia’s continuing war on Ukraine, and Latvia needs to be prepared for similar situations as it continues to support Ukraine.
She also warns about any disinformation attempts coming from Russia in response to the incident.
Siliņa also talks about some practical concerns about the way Latvia’s emergency alert system worked last night.
Lisa O’Carroll
Meanwhile, the European Parliament has said it will work “expeditiously” to ensure the “spirit and the letter” of the EU’s trade deal with Donald Trump is sealed, after representatives failed to reach a deal in ratification talks with member states last night.
No deal is expected now until 19 May when talks with MEPs resume.
A timetable in Europe’s democratic process risks invoking the ire of Trump who on Friday said he would increase car tariffs from 15% to 25% because the EU were taking to long to implement its side of the Turnberry deal.
The parliamentary delegation in the so-called “trilogue” talks which also involved the European Commission were led by MEP Bernd Lange, chair of the trade committee.
Lange said in a statement last night:
“We have just concluded a constructive second trilogue during which we made good progress on the issue of the safeguard mechanism and the review and evaluation of the main regulation, but there is still some way to go.
We will continue to work expeditiously and responsibly on the two legislative proposals to ensure that the letter and the spirit of the Turnberry Deal are honoured, in full respect of our democratic norms, procedures and timelines. The next trilogue will take place on 19 May in Strasbourg.
We remain more committed than ever to advance and defend Parliament’s mandate so as to provide additional guarantees that will benefit citizens and companies in both the EU and the US.”
The 19 May date for next talks will be seen as a positive step however as yesterday Lange’s team were expecting the next date could be as far away as June.
Lange’s committee were looking for three key amendments to the deal hashed out at Trump’s golf course last July.
Jakub Krupa
We should get more on the Latvian incident before long, as we are expecting to hear from the government after this morning’s emergency cabinet meeting.
Crucially, the crash site of the second drone reported within Latvian airspace is yet to be discovered, so let’s see if we hear more on this.
I will keep an eye on this.
Morning opening: Latvia investigates drones ‘from Russia’ after overnight airspace violations
Latvia is investigating two drones which entered its airspace from Russian territory overnight and crashed in eastern part of the country near an empty oil storage facility.
Four empty oil tanks were reported damaged, with minor smouldering reported in one of the tanks. The local public broadcaster captured a drone flying in the area on their camera.
Latvian prime minister Evika Siliņa convened a crisis management meeting for 10am local time. She earlier said she was “in constant communication” with relevant ministers and state institutions.
“After the incident concludes, I expect reports from the responsible ministers on what happened,” she said.
The investigation is still in very early stages, but the drones might have been Ukrainian units that lost their way due to signal jamming, defence minister Andris Sprūds said.
This would not be the first time that a lost Ukrainian drone attacking Russia’s oil terminals loses its way and ends up in a neighbouring Nato country, with similar incidents involving Estonia and Lithuania.
“As long as Russia’s aggression in Ukraine continues, the recurrence of such incidents when a foreign unmanned aircraft enters or approaches Latvian airspace is possible,” the Latvian army said in a statement.
The air warning in the country has now been lifted, but some flight restrictions remain in place.
Elsewhere, I will also keep an eye at US secretary of state Marco Rubio’s visit to see Pope Leo in the Vatican amid a bitter war of words between the US president, Donald Trump, and the pontiff. Before that, Leo – who will mark one year in office tomorrow – will also meet with Poland’s Donald Tusk.
Meanwhile, Hungary’s incoming prime minister Péter Magyar is also expected nearby, as he is due to meet with Italy’s Giorgia Meloni, formerly a close ally of Magyar’s arch-rival Viktor Orbán.
Elsewhere, I am expecting some developments in Bulgaria with Rumen Radev likely to be asked to form the next government, and obviously will continue keeping tabs on the hantavirus-hit cruise that electrified the public opinion worldwide.
Lots to cover.
It’s Thursday, 7 May 2026, it’s Jakub Krupa here, and this is Europe Live.
Good morning.
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