forces of committing acts of terror as the kremlin intensifies. russian troops continued to shell military and civilian facilities, according to ukraine's general staff. satellite images shown on russian military convoy on its way to kyiv. ukrainian officials say russian forces hit the site of a tv tower at the capital which knocked out broadcasting there. president zelenskyy employing the european parliament to allow ukraine to join the block. eight national leaders in the eu, including those of the czech republic, poland and slovakia are pressing the union to immediately grant a path for ukraine to join. >> we have proven our strength. we have proven that, at a minimum, we are exactly the same as you are. so, do prove that you are with us.

prove that you will not let us -- prove that you are indeed our european. [indiscernible] mark: sub eu officials are cautioning that the procedure is usually long and complex. senator joe manchin wants the biden administration to encourage more domestic energy production. senator manchin says it is "ridiculous" that the u.s. buys oil from russia. he says he is planning weeks of hearings on energy independence both for the united states and to support allies. hong kong will impose a lockdown to ensure a mandatory coronavirus testing drive this month is effective. that's according to local news media. reports a officials will test the whole city three times over nine days. in the last few weeks, the number of covid cases in hong

kong has ballooned from a few hundred a day to more than 34,000 on monday. global news, 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i am mark crumpton. this is bloomberg. ♪ >> good afternoon from new york city. 2:00 a.m. hong kong. i am matt miller. here are the top stories we are following from around the world. equities push lower. bonds rally amid concerns about the impact of the war in ukraine. traders abandoning bets on a half-point fed increase this month. the oil search is front and center. even as the u.s. and other major

economies plan to release emergency stockpiles, the move not only failed to ease concerns, but supercharged the gain in practice -- prices on brent crude and wti, both well above 100. we also discuss how investors are weathering the commodity space with jason bloom. first, a quick check out what is going on in terms of the actual numbers right now. you saw the s&p 500 down 1.2%. the move lower has been exacerbated by the jump higher in oil. we will show you that in a second. you can see the vix above 33. u.s. 10 year pushing under 173. the bloomberg dollar index up at 186. these are all risk off measures

of course as investors are concerned about the volatility. they sell stocks, buy bonds and by u.s. dollars. take a look at oil. absolutely soaring today. the gains were really supercharged by the announcement the ia would release 60 million barrels of oil. right now, this is a three-day charge. you can see at $105.90. that's brent? that's brent crude price. texas intermediate is almost $100 a barrel right now. we are seeing huge gains in these contracts and it is quite dramatic. this is a seven-year high. we haven't seen prices like this since 2014 and we have not seen a jump like this since may of 2020. the list of sanctions against the kremlin is growing as the eu considers excluding seven major

russian banks from the swift messaging system. the u.k. is calling for a total swift than for russia. prime minister boris johnson spoke today in poland. >> we are willing if necessary, and i think it will be necessary, to go further. there is plenty more to be done on swift. we can tighten up yet further on swift. even though it has had a dramatic effect already, we need to go further. there is more to be done on the freezing of russian assets. >> joining us for more on the impact of sanctions is justine walker, association of certified anti-money laundering specialists. one of the impacts we seem to be seeing, and this has been happening before today, is that when people think certain commodities will be more difficult to buy, they go into the markets and bid as many of them as they can.

we are really driving up the price, and therefore the revenue to moscow for this oil and gas. >> what we are seeing is unprecedented. measures which were off the table a week ago are now front and center. but you are right, there is still some elements in play. oil and gas is one. what the markets are doing as they are reacting to the evolving situation, which for any of us in the sanctions community we are just trying to map. it is changing hour-by-hour. central bank sanctions and indeed swift measures and the rise of tightening on the russian economy is creating havoc. both globally and within russia itself. this is to be expected. the other aspect i would say is this is the first time we've had a g20 economy have their central

bank acts -- bank assets targeted. we have only releasing this measure in -- scenarios before in relation to afghanistan, iran, libya, venezuela, syria. very different scenarios. much less integrated into the global economy. how this will play out in the markets and indeed politically over the coming days is anybody's guess. i do not think any of us can predict how this will evolve. matt: what do you think of the concerns voiced by jamie dimon yesterday that bad actors will find their way around swift sanctions? it is kind of a boilerplate critique of legislations that bad actors will be gaming the system anytime we were -- we enact. how much of a concern is this? justine: -- will undoubtedly

happen. we have seen this all of the time. the important element to make the distinction here is the ability for the russian economy to function as a normal economy. that will be curtailed and there is just no way you can dispute that. but even if you disconnect swift, a partial or full disconnection, payments will still move. we see that in iran, north korea, syria. the issue really is, how do you make those payments, and also, will people be willing to make those payments? russia is reliant on both money going in and coming out. a lot of people are just not going to be able to send money into russia. they are not going to be able to pay their dues. it is going to impact, but sanctions will undoubtedly

happen. the other element i would say is what we have seen is the g7 and the eu target the russian central banks. critically, what will other actors do, particularly china and others where russia still has foreign reserve space there. there is going to be an element of how much broader will these measures go. will others follow suit and tighten up as well? matt: quickly, how do you see that playing out? we seem to be getting mixed signals from china in terms of support for their colleagues in russia, at the same time they condemn the tragic effects of war. justine: two elements, what will be the official china government response? the other is how the private

sector will respond. the sanctions will bite most from how the private sector response. i think we will see economies -- so those in asia and china indeed also being really cautious with russia. they are going to be very fearful of u.s. sanctions. they do not want to be targeted by them. they do not want to be excluded from the u.s. dollar. that said, we still have seen china take a different stance on iran, as indeed the u.n. has. i think we will see a different stance coming from china. it is likely to be more measured. but, they are going to look at their own long-term interests. we don't know how this is going to play out. will russia cut off the oil and gas to europe and divert it elsewhere? what will happen to global trade? russia is a major exporter.

matt: justine walker, global head of sanctions compliance and risk at the association of certified anti-money laundering specialists. coming up, it fell out in markets after russia's invasion of ukraine as well as the possibility of negative ramifications u.s. sanctions could have on tech firms and the u.s. dollar. we hear from ken griffin about that. t.

♪ matt: this is bloomberg markets. geopolitical tensions dominating the world stage as investors grapple with russia's invasion of ukraine. citadel ceo ken griffin sat down with david rubenstein to discuss the market fallout. >> people often do not appreciate how forward-looking financial markets are. when a company announces a great quarter and you see the stock price fall, how did that happen? investors had anticipated a better quarter. markets are forward-looking by nature. this year, we have seen the

market -- quite a bit up to the date of the invasion of ukraine. anxiety about how your interest rates -- higher interest rates. as the war broke out, the narrative changed. we started to talk about lower interest rates for longer. we started to talk about how different governments were going to react to this vis-a-vis russia, and the scope of the sanctions that would be unfolded and the consensus over the course of the trading day was that the worst news was behind us and the prospect of easier monetary policy, less draconian sanctions than feared, created a relief rally. david: do you expect these gyrations will continue as long as russia is in ukraine? or do you think the market has made their assessment? ken: we are in a very volatile inflection point. it will come down to whether or not the russians will be satisfied by simply extending

their effective borders in ukraine. will they take you kyiv? will they position themselves to reach beyond the borders of ukraine? the last is terrifying to markets. there will be at -- to most of core europe if they move their military. that has markets concerned. much will unfold over the days and weeks to come as russia's ambitions become clearer. matt: ken griffin, citadel founder and ceo speaking with david rubenstein. you will hear more from that exclusive interview when bloomberg wealth returns. staying with the war in ukraine, the fallout in commodities has been insane. the iea agreed on a coordinated release of oil stockpiles globally as russia's invasion push crude above $100 a barrel.

that supercharged prices and they went even higher after the announcement. let's bring in annmarie hordern, standing by at the white house. it seems that traders took this as a signal there could be a shortage soon and decided to buy as much as they could. annmarie: there is some angst and concern in the markets about what would happen if we start to see less russian crude hitting the global energy market. russia is the second biggest exporter. we have from that iea, these consumers around the world, that the u.s. will tap -- the second time they have done this under president biden, the fourth time that iea as a whole has done this. the u.s. will make up about 30 million and the rest will come from others. as a whole, that 60 million. we heard from press secretary jen psaki after the iea

confirmed our reporting on the fact is she says this is about what president biden has talked about in terms of working in lockstep with the european and other allies around the world in asia and north america and making sure that at the same time they can try to protect american businesses and consumers. when you see elevated oil prices, that trickles down to gasoline pump prices. matt: to put this in perspective, and correct me if i am wrong, 60 million barrels of oil is just over half of what we use in a day globally? i think 100 million is roughly what we use in a day. the 30 million that is going to come from the spr is about 5% of what we have in total. do we have about 600 million barrels in the spr? annmarie: it is also about six days of russian exports but i do not think the iea is looking at this as if russian production is going to go away. at the moment there are zero

sanctions directly addressing the russian energy sector. this is probably just something they are preparing to do given geopolitical concerns. the fact is it is also difficult right now for individuals to get those exports out. not so much natural gas, but individuals i am speaking to who have worked at these trading companies before talk about the fact that it is very hard to find a ship that is willing to go pick up russian crude. you may end up seeing -- we are not seeing this yet exactly, but you may see some companies decide to sell sanction because they do not want to deal with putin. we have seen a lot of mega energy companies decide they are going to exit russian companies. matt: there is no intermediary bank that wants to do the transactions, so that's fascinating.

you are uniquely positioned to cover this story because as a journalist you are that she you were covering opec, now you are in washington covering politics there. it will be interesting to see what president biden comes out with tonight in his state of the union. still ahead, jason bloom, invesco head of fixed income will join us to discuss how the company's funds are faring amid all of this volatility.

matt: this is bloomberg markets. let's get to something that caught my eye. one of the largest issuers of leverage and inverse etf's is shuttering its russia product after sanctions derailed trading. direction shares etf trust said it will liquidate and close the direction daily russia bowl to

timeshare etf. price is on top, assets on bottom. a lot of russian assets have stopped trading not only in new york, but around the world. that is making life difficult for operators of packages like this. jason bloom, invesco head of fixed income. he joins us now. it is fascinating because a lot of products, may be that people wouldn't even think about, do touch russian assets in some ways. and then they've got to be reorganized during a time like this. have you had any issues yourself? >> it is certainly day by day. at this point in time we have been able to trade, at least as of yesterday we were able to trade any russian equity holdings and we have an emerging market of sovereign debt funds that rebalanced yesterday and we were able to trade belarus, ukraine and russian bonds.

there dollar denominated and as i understand the latest headlines, the dollar denominated debt is maybe not yet, or as impacted as ruble denominated russian debt. matt: are you getting out of that? are you liquidating those positions as you can? >> most of our products are in that space. the portfolio managers have a legal obligation to track the index. so, it is up to the index provider, if they were to determine that security no longer qualified, then the index provider could -- the security then we would look for a way to track that move. it is not within the discretion of the pms to make that call on their own. matt: to change the subject's likely, we are looking at the diversified commodity etf. we have had some just nuts moves today in commodities, oil put up

its biggest gains since 2020. it's the highest level we have seen since 2014. what do you think is driving this, especially after we heard the iea is going to release 60 million barrels of oil, we saw the price supercharged to the upside. >> there's a couple of things going on. you guys spoke to this early in the program, there are several market participants that are self sanctioning. even though we are not -- because of the -- related to the financial systems in the banks, if you can't pay for it, people don't want to risk getting involved. if you can't get a ship to pick up that commodity, people are backing away. at the end of the day, it is having the result of holding supply from the market in the short term. we do think the market will be creative when the dust settles and people get confirmation from government agencies as to what they can and cannot do.

the market will adapt and those exports are likely to resume. i think it is going to be a fairly short-term phenomenon. it is great they are standing by -- if we see that short-term jolt disrupt and we don't want to see the markets disrupted at this point. the goal is not to see commodity markets majorly disrupted. it is great they are looking at that, but keep in mind, that is a short-term solution. they traded in the fall and it lasted about a month. if this drags on, the spr is not going to do the trick. matt: thanks for joining us. we hope we can get you back. jason bloom, invesco head of fixed income talking to us about what we are seeing in commodities. it is an historic jump. we will continue focusing in on the changes. ♪

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as the fighting goes on in

ukraine, the kremlin's isolation is growing. the european union is considering the exclusion of seven russian banks from the swift system. the united kingdom is indicating it may follow. boris johnson spoke today during a visit to poland. >> i think it will be necessary to go further. there is more to be done on swift, we can tighten up further on swift. it is had a dramatic effect already, we need to go further. there is more to be done and on the freezing of russian assets. mark: nato says it has not changed the status of its nuclear forces in response to vladimir putin's decision to put his nation's nuclear commands on high alert.

the alliance is not increasing its nuclear readiness. nato says the purpose of the nuclear forces is to deter aggression. the european unit is discussing more sanctions against russia, it now to seek seven russian banks from swift, the system that facilitates international payments. that is according to a proposal. one of the banks is one of russia's largest. as the judge ketanji brown jackson prepare to meet senators, we come to understand how she became the nominee. the white house contacted her four days after the justice announced retirement plans. jackson said she spoke with vice president kamala harris on february 11 and then through this after that she interviewed with president biden.

-- three days after that she interviewed with president biden. global news 24 hours a day, on-air and at quicktake, powered by more than 2700 journalists and analysts in over 120 countries. this is bloomberg. >> welcome to bloomberg markets. matt: i am matt miller, with the fed decision coming closer, traders are scrapping their bets on half-point rate hike after concerns that russian invasions in ukraine have an impact. a lending club ceo on the fed's best path to more traditional banking. eight combined national -- a

combined national gas asset creating more opportunity in the global energy transition. if we have all been focused on the incredible climbing price of oil, gypsum absolutely amazing and stands out in the market -- just absolutely amazing and stands out in the market. john: we have been looking at the stocks, the effects has the big energy component struggling because of the higher oil price. s&p down by 1.9% on the day. crude was around $65 in december. here we are well above $100. the implications of everything happening in ukraine, it feels like there is a little to slow down oil and that word slowdown at economic outlook is at the center of the storyline.

you have traders casting aside wagers on rate hikes across the world including pricing of a 50 point hike by the fed in march amid concerns that the fallout of russia's invasion will away on the growth outlook. we have been measuring through the swaps market and the bottom line is that there is the possibility of a half-point rate move and you have some people on the fence about 25. it is not a u.s. story, we have been watching the commentary come out of u.n. officials as well. matt: what can the fed to about the inflation side of the ledger? slowing down growth may help to kill demand, but is that what they want to do? will we be in a situation where we look at continued inflation and a slowing rose picture?

-- growth picture? i am not sure if i want to guess what we should call this. we are looking at the market adding pressure at the front end. yields, five-day, fall, the largest since 2020. we were pricing in, we have been pricing in seven rate hikes for the full year and we are only pricing 85 if you look at the screen. there has been a change over the past few days. russia invaded ukraine and people have had to reprice expectations. john: we see the financial stocks under some pressure, let us to on the same theme and bring in ira who is watching all of these moving pieces.

as you scan the universe of rate expectations, what are you hearing? >> l of different things -- a a lot of different things. everyone was worried about inflation, now we are getting inflation and matt does not want to use the word stagflation but that is what we are starting to price here. we are starting to price for slower growth, a federal reserve that is not wanting to destroy it demand like they would if they hiked interest rates seven times. we are starting to price out some possibility of a hike. we are not in march anymore. when i look at overnight index swaps to the march meeting, that is two weeks away. we are pricing in a 90% chance of a hike on that day. as this developing situation continues, we are going to see more volatility. i think the fed as we do hike in

march. the issue is what is the pace that they are after? that is what markets are pricing right now. we are only pricing for six hikes instead of the eight or nine we were a couple weeks ago. matt: i want to talk about the last few days, from quit suisse, bring up that idea -- credit suisse, you worked with them. we would see a massive default, a big miss payment, huge overdraft, is this a march 2020 difficult? we see that top up in the live or overnight lending spread? how much difficulty in finding are you seeing right now in this market -- in funding are you seeing right now in this market?

>> when you look at other funding streams they seem to be ok. unlike march of 2020 or 2008 under lehman, the federal reserve has more tools with other central banks to make sure that financial institutions can get the dollars that they need when they need it. they have international swap lines and they have a remote facility that can be used by other banks in other jurisdictions. the fed does not take any default in this because they are facing another central bank counterpart. like the bank of italy or the bank of england. we may have a bit of strain. the bigger issue is what happens to credit spread? we are seeing credit spread wide and in and of bank stocks, in particular the european names. that is where you are starting to see a bit of the stress. the reason why it is widening.

john: stagflation has come up in this conversation, looking at that possibility as well. given the situation in ukraine and the concerns in europe as well, should we be getting ready for differing opinions coming from different central banks around the world after what felt like a path for central banks globally doors higher interest rates before we were talking about -- globally higher interest rates before we were talking about this? >> the price hike is off at the table, german audios below on the 10 year -- bond yields below on the 10 year. the ecb is letting inflation run and little bit hot.

central banks have these problems, the central banks can really control the demand side of the equation of this supply and demand equation. even if demand slows, the reason that supplies are being hit is because things are out of their f the monetary authorities. that help takes years to build, years to build a new port, additional infrastructure around the port. roadways to get trucks in and out. that is something that cannot be helped in the near-term. we may have to get used to the idea that inflation in some sectors is going to be higher than it would be for. if prices would stabilize in the next couple of months, inflation might be significantly lower. base affects matter here. not just the level of some of these prices. matt: when the costs for a

pickup truck goes up, it does not come back down. it stays at that level at the very least. we are going to speak to the lending club ceo scott on the impact of peer-to-peer lending. this is bloomberg. ♪

matt: this is bloomberg markets. time for our stock of the hour, lucid is feeling supply chain pain as the shortage of raw materials has forest a cutback -- forced a cutback.

what have you got? >> the are calling this extraordinary supply chain pressure. it is not based in semiconductors, it is a glass, carpet. they did say that they expect the supply chain situation to improve in the second half of the year. it is a big reduction in the outlook for the year. the rate is down to 12,000 vehicles. they have only delivered 125 cars. they have only delivered 300 vehicles, 200 have been recalled because of a safety defect. lucid is getting a reality check on how difficult it is to launch a new tv product and mass manufacture it. -- ev product and mass manufacture it. if you go through the 10k, there

has been a some hard slog stuff going on here -- some hard slog stuff going on here. they are pushing back expectations. they went public, and now the stock is trading at the lowest since february. biggest drop since september. matt: this happens on a day that will jumps $145 a barrel -- $125 a barrel. lending club acquired it own bank -- its own bank. making them less dependent on other institutions and letting them grow more.

to discuss the impact of that as well as the rising rate situation as well and the russia ukraine more, is the ceo, scott sanborn -- war, is the ceo, scott sanborn. you do biggest additional business and you sell into the marketplace institutions. are you concerned by the sanctions that you need to really evaluate -- reevaluate? >> we hold about 20% of the loans we issue and we still 80% to other institutions -- cell sell 80% to other institutions. we are not seen in immediate response in the returns on the assets. they have proved their worth during the last recession. it showed how will they

performed versus other asset types. demand for the asset is really high. matt: are there any relationships you have to immediately sever? >> we have no connection to russia besides the human side, we have employees we are looking to support but we have no exposure in the market. john: the evolution of the business, the initial premise of matching borrowers with lenders. you made the reference to buying your own bank, a digital bank. talk to us about the shift. you have been spending more time explaining the evolution of the business model. >> when we first started the idea was we can use technology to lower the cost of credit to increase access to credit and deliver great experiences. when we added the bank last year, it was a plus for the business. we lowered our cost by

reintegrating the chain, we were issuing loans and taking out warehouse allies and we brought in a whole new revenue stream. by holding 20 resid of the loans we earn three times as much for the loans we sell. that is a recurring revenue stream, that is a lot of opportunity for sustained wrote. -- growth. you are seeing the financial benefits already, we had record net income for the company. when we look ahead beyond to where we go next, we see the opportunity for real strategic benefits. beyond lending, helping them with spending and saving. matt: why don't you hold 40% or 60%? >> a couple of good answers to

that. we love the marketplace, the marketplace does a few things for us. if it allows us to go up and down based on market conditions. it also allows us to approve loans and fund loans that are outside of the credit risk appetite of the bank. if you are a hundred fifo -- 800 fica, we have a great product for you and that will be funded by us. if you have 600 fica, we have someone for you. matt: can i ask you about defy? there is this fantasized idea that it will allow us to lend to each other and participate. it is a competitor or do you have competitors in the startups? >> what we see happening is really this embedded finance in all different types of locations.

people providing that, it is a race for the customer. everybody is looking to surround the customer with services and keep them in their fold and hold onto them. our view, given our vertically integrated model and given our excellence in the credit front, we thinks running people with banking services but leading with the lending is the way that we will win. john: we appreciate your time, the lendingclub ceo. glencore, the biggest commodity trader is reviewing its shareholding in russia's biggest companies and the wider trading operations in that country. this is coming after a number of energy giants announcing plans to cut ties with their russian partners. glencore owns a stake in the controlling share of the aluminum giant and a small stake of less than 1% in the russian

oil major which has been at the center of some headlines as well. speaking of energy, we saw a big deal in canada today. this is bloomberg. ♪

john: not to a multibillion-dollar move in the canadian energy sector, kkr and a pipeline has agreed to combine their assets in western canada. let us bring in jeffrey morgan who is covering this story. these are huge numbers. talk to us about the dynamics that play when it comes to the canadian national gas and why these heavyweights would come together. . >> there is a lot of natural gas production in canada.

pembina has been inquisitive. they try to buy a pipeline but they lost to brookfield, this deal with kkr, kkr and pembina are forming a joint venture and it is buying the assets of energy transfer canada. there are multiple facets to this with strategic players trying to be active in this space. kkr is getting out, but there are major major investors in this space. it has been a very active dealmaking space. john: huge investor interest, i guess one of the big issues we have often talked about is being able to move all of this. i would imagine jeffrey, as this still comes together, will be watching if there are further solutions on that front? >> the natural gas pipeline

system out of western canada has been constrained in various places over the last number of years. natural gas processing which is a big part of this deal as well has seen a lot of activity. you have a company called normally oil corporation -- tourmaline oil corporation, it has been very active because there are a lot of companies producing in this space at a up their portfolios. matt: thank you for joining us. i am matt miller, this is bloomberg. ♪

mark: russia's invasion of

ukraine is entering a new phase. 42 a more deadly time ahead for the country -- pointing to a more deadly time ahead for the civilians and armies. u.s. and allied nation officials say they expect more indiscriminate tactics as russian forces look to suppress ukrainian resistance. many foreign companies are abandoning russia, that is reversing three decades of business investment since the collapse of the soviet union in 1991. shell is ending partnerships with gas companies in russia. has a war in ukraine has forced president biden -- the war in ukraine has forced president biden's to rewrite the first part of the state of the union address.

the pr