Nuclear watchdog chief pitches ‘leaner’ UN in secretary-general bid

Donald Trump has said the US would not invest in a $300bn fund for Iran and denied pressuring Gulf states to contribute to what could be a carrot for the Islamic republic to accept a peace deal.

“We’re not putting up 10 cents,” the US president said, adding that “we are not investing in it and we do not have a fund”.

Iran and the US have agreed on a 60-day extension of an April 8 ceasefire that promises to ease the global energy crisis sparked by the war.

Discussions for a final settlement that will depend on Iran agreeing a nuclear deal will begin after the memorandum of understanding was signed on Wednesday.

Petrol prices have begun ticking down because of the ceasefire, heading below $4 a gallon, easing pressure on customers squeezed by a rampant cost-of-living crisis.

And Americans have recently taken a slightly less gloomy view of the war, with the University of Michigan’s closely watched consumer sentiment index recovering from a record low of 44.8 in May to 48.9 in June. 

This week, the boss of the world’s nuclear watchdog makes his pitch to lead the UN. We also examine US crude oil stockpiles, which have plummeted to decades-low levels amid the Iran war. — Martha

Nuclear watchdog chief pitches a ‘leaner’ UN

The head of the world’s leading nuclear agency has pledged to make the UN “leaner” if he is elected secretary-general, taking aim at what he sees as the international body’s excessive climate and development bureaucracy.

In an interview with Energy Source, Rafael Grossi, director-general of the International Atomic Energy Agency, said that too many UN agencies were performing the same work and needed to be streamlined.

“We need to put the UN back on track . . . we need to have a more focused, right-sized organisation,” he said. “It’s very possible to do [UN functions] with a leaner structure.”

Grossi in particular has his eyes on some of the UN’s climate and development programmes, saying that there is “duplication, triplication and quadruplication in some cases” of these functions.

“I’m not exaggerating,” he added.

Grossi is one of five candidates seeking to replace the current secretary-general, António Guterres, in 2027, at a time when the UN’s relevance is increasingly in doubt. The organisation faces existential questions over its support from a highly sceptical Trump administration, while emerging nations have questioned its basic structure, which privileges the five permanent members of the UN Security Council — the US, UK, France, China and Russia.

Grossi has led the IAEA for nearly seven years, guiding the organisation through major world conflicts where nuclear issues have emerged as a flashpoint.

He has advocated for nuclear safety in Ukraine, saying that drone strikes on the Zaporizhzhia and Chernobyl nuclear sites are “playing with fire”.

Grossi has also hit out against the bombing of Iranian nuclear locations, while pressing the Islamic republic to disclose the location of its surviving enriched uranium and allow inspectors to enter its sites. He believes the UN failed to manage the conflict.

Outside of the battlefield, he has focused the IAEA on civilian uses of nuclear, including in cancer care and food safety. Nuclear technology can be used to diagnose and treat tumours with targeted radiation, while it can also kill bacteria and pests and detect food fraud.

The next person to occupy the top job will need to balance appeasing the US while embracing more multilaterally minded states.

Grossi is facing four other candidates: Michelle Bachelet, the former president of Chile; Ecuador’s María Fernanda Espinosa, the former president of the UN General Assembly; Rebeca Grynspan, the head of the UN conference on trade and development from Costa Rica; and Macky Sall, the former president of Senegal.

His critique of the UN is in line with some of the Trump administration’s criticisms of the body. The US president has said the UN operates on “empty words”. Washington has withdrawn from dozens of UN-related treaties and international agreements, and ended funding for 31 UN entities. Notably, the US withdrew from the Intergovernmental Panel on Climate Change and the UN Framework Convention on Climate Change.

US energy secretary Chris Wright said Grossi would be a “huge improvement” over Guterres.

Grossi, an Argentine, also has the backing of his country’s president, Javier Milei, a Trump ally.

“Being an Argentine national, I would not seek any other country’s support,” Grossi said, but he admitted “it is not a secret that [Milei is] sceptical of multilateral organisations”.

The IAEA director-general disputes that this could create an issue for his candidacy, saying that the issue has not come up when discussing his candidacy with heads of state from Europe, Asia, Latin America and Africa. He is also confident he can withstand calls for the UN to choose its first female secretary-general.

“I think they see Rafael Grossi for what Rafael Grossi is,” he said.

Grossi says the next secretary-general should be unafraid to “put [their] hands in the mud, get dirty and go” and deal with leaders who have fallen out of favour with the international community. He cited his handling of the Ukraine war, in which he has dealt directly with Ukrainian President Volodymyr Zelenskyy and Russia’s Vladimir Putin, with whom he has a “very professional” relationship.

“You must find solutions, never by cancelling somebody or saying because this leader has done something I disagree with, I’m not going to talk to him or her.” (Martha Muir)

Data Drill

Stocks of crude in the US Strategic Petroleum Reserve have fallen to 340.3mn barrels, the lowest level since 1983, according to data released from the Energy Information Administration.

There has been a net loss of approximately 75mn barrels since the Iran war began on February 28. On March 11, Trump authorised the release of 172mn barrels as part of an agreement with the 32 member countries of the International Energy Agency to make 400mn barrels of oil available to the market.

Stocks in the SPR also fell below the Biden-era low of 346.8mn barrels after the former US president tapped it following Russia’s full-scale invasion of Ukraine. Trump has frequently criticised Biden for using the reserve to mitigate prices at the pump.

“When we made the transition, [the reserve] was at the lowest level in history ever recorded. It’s the lowest level. Nobody’s ever seen it that way,” Trump said at a Saudi-backed investment conference in 2025.

Now, the gains made under Trump’s “drill, baby, drill” agenda have been lost.

The US has not been the only country dipping into its inventory to manage the current energy crisis. A significant portion of the 400mn barrels of oil released by the IEA came from Japan, which pledged 80mn barrels. The country has released an additional 36mn barrels since the March 11 announcement. Canada, South Korea and Germany also made significant contributions to the IEA’s collective release, with 23.6mn, 22.5mn and 19.5mn barrels of oil respectively.

Many analysts believe that China, which has the world’s largest oil inventory, has also been pulling from its reserves. While the country does not release data, its oil imports have dropped sharply since the start of the war. This has also shielded global oil prices from a much sharper ascent.

Countries without large oil reserves have had to find other ways to cope with climbing energy prices. Fifty-five nations have lowered taxes on fuel and 32 have announced some form of energy subsidies since the war began, according to data from the IEA.

For them, and for the SPR, the US-Iran interim deal comes as much-needed relief. (Nolan Shaffer)

Power Points

• The UK’s environment secretary has cast doubt on a £10bn rescue package for Thames Water.

• A glut of oil will emerge next year if the peace deal in the Middle East holds, the IEA said.

• ConocoPhillips is set to become the first US oil and gas major to sign a contract with Syria’s new government.

Energy Source is written and edited by Jamie Smyth, Martha Muir, Alexandra White, Rachel Millard, Malcolm Moore, Ryohtaroh Satoh and Stephanie Findlay with support from the FT’s global team of reporters. Reach us at [email protected] and follow us on X at @FTEnergy. Catch up on past editions of the newsletter here.