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U.S. Military Reimposing Blockade of Iranian Ports; U.S. Strikes Iran for Third Night as Tehran Attacks Gulf Nations; Kevin Warsh Faces Congress for First Time as Fed Chair; Inflation Cooled Significantly in June as Gas Prices Fell; France Facing Spain in 2026 World Cup's First Semifinal. Aired 3:30-4p ET

Aired July 14, 2026 - 15:30   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

[15:30:00]

BRIANNA KEILAR, CNN HOST: Just minutes from now at the top of the hour, the U.S. military is set to restart its blockade of Iranian ports. But today in a significant reversal, President Trump says the U.S. will not charge tolls on cargo ships moving through the Strait of Hormuz. He says he dropped the planned fee after several Gulf nations instead offered to invest in the U.S.

BORIS SANCHEZ, CNN HOST: The blockade is getting underway after the U.S. launched another wave of strikes across Iran overnight. The attacks marking the third strait night that the U.S. and Iran have exchanged strikes as they battle for control of the Strait.

Our next guest just wrote about the implications of the escalation in fighting in a new piece on CNN.com. The headline reads, Operation Boomerang, a return to military strikes reveals no good options for Iran or the U.S. CNN Global Affairs Analyst Brett McGurk wrote that analysis, joins us now to talk more about it.

[15:35:00]

You described the U.S. and Iran as reading the same MOU on completely different terms, interpreting it in completely different ways. Is that why it fell apart? Was it doomed from the start?

BRETT MCGURK, CNN GLOBAL AFFAIRS ANALYST: It's written, as we said, when it first came out, when CNN first got a copy, that this is like very incoherent. Article 5 talks about who controls the Strait and says Iran will make arrangements to actually guarantee over these 60 days traffic through the Strait. Which Iran reads to mean, we, Iran, will determine how this is going to work. The U.S. has said that's really not what it means, that there's some side understandings.

In any case, this has all now completely fallen apart. And I think boomerang is right because whatever we try here, we can try military strikes, we can try short-term deals. You're going to keep coming back to this problem because the Revolutionary Guard, they're the power in charge in Tehran still.

And they are determined to use this leverage over the Strait of Hormuz with drones and cruise missiles. I mean, it's outrageous what they're doing. They're attacking civilian ships with cruise missiles and drones.

But this is what they do. It's very hard to stop wars. In 2023, 2024, the Houthis, an Iranian proxy group in Yemen, did this in the Red Sea.

We formed an international coalition. We launched an air campaign against the Houthis. Just very hard to stop a drone that can fly 1,000 kilometers or an anti-ship ballistic missile, very accurate, can be launched from anywhere.

It's a gnarly problem. So now we're back to military strikes, trying to put pressure. Iran is attacking.

And, you know, kind of back to the future.

KEILAR: Yes, you lay out Iran's advantages, the ancient and the modern, you say, the geography and then those cheap drones, of course, which cost so much to defend against. How are you seeing U.S. advantages in this situation? Is there any potential leverage?

MCGURK: Geography is key. You can go back to, like, the Bay of Pigs and the JFK administration. He said famously, we should have looked at a map.

We didn't actually look at a map before. So Iran is using geography and then the modern drone. We have some advantages if we have time.

And, you know, the Iraqi prime minister is in the Oval Office today, even as we're at war with Iran. Two key governments in Lebanon and Iraq now have governments that actually are, like, pushing back against Iran. That's quite significant.

Longer term, there's -- in the region right now, Brianna, there's diversification away from the Strait of Hormuz, new ports, new pipelines. This is all moving. It's going to take time.

But that will reduce Iran's leverage over time -- if we have time. So this is where the macroeconomic picture and the markets and the price of energy, everything else really will begin to pile up. But that's the key equation.

Who has the time? I was in the Middle East last week and one senior official said to me, everybody should take off their watches because Iran wants to say, we have all the time in the world. And the recommendation was the U.S. should actually kind of play this game and, you know, settle in for a long-term campaign of pressure. But that's hard because if the Strait of Hormuz is shut, you're going to have that compounding effect on the macroeconomy, gas prices, everything else that we were seeing just a couple of months ago.

SANCHEZ: And downstream of that is politics. You have midterm elections coming up and Congress facing some decision over how to determine whether or not they're going to move forward with the War Powers Resolution. I guess the question is, if you had to guess, how much time is there left for the United States to make a decision one way or the other? MCGURK: You got to watch those markets, Boris. I mean, we'll see what happens with energy prices. The president is saying today that perhaps it's going to stay low given that demand is low and supply is up. We'll see.

But one thing that is really tragic here is that not only was this launch without support of the American people or explaining what we're doing, we also have no allies with us. I mean, we have this problem in the Strait of Hormuz, an international problem, and it is right now a U.S.-only problem. And nobody is really with us. Now, the Gulf states are kind of with us. They are telling Iran very clearly, we will never accept what you're trying to do in the Strait of Hormuz.

When it comes to power and pushing back, it's only the U.S. military. So we have no allies. Very low level of American popular support.

And Iran watches all these factors. Again, I've been watching Iran for many years. They watch all this.

They watch American public opinion. They watch global opinion. They think time is very much on their side.

But again, that energy price equation, price of fertilizer, price of all those goods coming through the Strait of Hormuz, that's what Iran is counting on to cause a havoc. What the president said before the MOU, remember, he said, I don't want to be Herbert Hoover. I don't want to have a global Great Depression.

That's why they did the MOU. Well, we're now back to before the MOU. Right now, oil is ticking up, not to the point where it was, you know, some months ago.

But that's what you've got to watch.

SANCHEZ: Brett McGurk, thanks so much for the analysis. Appreciate it.

Still plenty more news to come. Today's inflation report appears to be good news. So why is the Fed chairman curbing his enthusiasm, his reaction before lawmakers, when we come back?

[15:40:00]

(COMMERCIAL BREAK)

KEILAR: Today, Kevin Warsh testified before Congress for the first time as chairman of the Fed, telling lawmakers he's committed to bringing the annual inflation rate down to its two percent target. He also appeared unsatisfied with a new report out today showing that inflation cooled more than expected last month.

(BEGIN VIDEO CLIP)

KEVIN WARSH, FEDERAL RESERVE CHAIRMAN: The reason I create a task force on data is I don't want to overread or cherry pick data. There might be some that look at this morning's data and say, oh, mission accomplished, everything is swell. That is not my view. (END VIDEO CLIP)

KEILAR: Joining us now is Scott Lincicome, vice president of general economics for the Cato Institute. Scott, thanks for being with us.

[15:45:00]

And of course, annual inflation did slow sharply because of a huge decline in energy prices after that fragile Iran ceasefire. Warsh says it's just one data point. I mean, how are you seeing it?

SCOTT LINCICOME, VICE PRESIDENT, CATO INSTITUTE: Yes, I agree with Warsh. It's one month. It's going to make a good political soundbite.

But as an economic matter, there's still a ways to go. There is some good news in here and some bad news. The good news is that we don't see oil and gas prices leaking into non-energy prices.

So that means less risk for broader inflation outside of energy prices. Other good news is that even today, with Iran war picking back up, oil prices really haven't gone up anywhere near their April and May highs. It's a testament to global energy markets that are keeping those things in check.

But there are some bad news. And again, I think this is why Warsh is right to wait. Price collapses from gas prices and other things like World Cup tourism fading.

Well, those aren't going to repeat. And oil inventories might well get depleted in the next few weeks. So maybe oil prices perk up, too.

And even with last month's deflation, you're looking at inflation still hotter than what the Fed wants. It's really back on pace for about 3 percent. So there's still a lot of issues to be worked out.

KEILAR: If the fighting continues on, I mean, we're just kind of a few days in now to this renewal and strikes back and forth. But if this does continue on and you're seeing oil prices go up considerably, would you be expecting that inflation goes back up this month and continues?

LINCICOME: Yes, I mean, I think you'd see it pop back up to that scary 4 percent level because that's where it was when oil prices did get into that $120, $130 a barrel range. Now, whether that is pushing for more persistent inflation or just a level change. Well, that's why the Fed is digging into these data, because they want to see whether this is something that's really getting baked into the real economy, that's starting to leak into services prices and other things, or whether it is just limited to energy.

So that's just, again, something you kind of have to wait for more data to see.

KEILAR: OK, the president really wants interest rates lowered. Warsh, I wonder what you thought of what you heard, because today he said the Fed will set them without considering politics. How might this inflation report impact Warsh's thinking on that?

How are you reading what you heard from him?

LINCICOME: Yes, I mean, I think that this gives him a little room to not hike rates, but I really doubt it's going to be pushing him to do what the president wants. You know, aside from all of the problems I already mentioned, look, there are new tariffs coming online at the end of this month. Other Fed researchers have noted that retailers might have been holding back on some tariff related price hikes.

They might be passing those through. So the idea that this is now a license to cut, that's pretty crazy. I think instead it's just more of the same, a lot of wait and see and data digging.

KEILAR: All right, Scott Lincicome, thanks so much for being with us for us -- Boris.

SANCHEZ: Now to some of the other headlines we're watching this hour. Brand new video shows parts of Texas underwater as millions of people face life threatening floods. Forecasters say some locations near San Antonio saw six to 12 inches of rainfall overnight, prompting emergency water rescues.

Officials warn that some areas could see an additional 10 inches by tomorrow morning. Flash flooding alerts issued for nearly six million people are expected to last through Thursday.

Also, Chelsea "Sully" Sullenberger, the Miracle on the Hudson pilot, just revealed that he's been diagnosed with Alzheimer's disease. He's released a statement today saying that he was recently diagnosed and that the disease is in its early stages. The 75 year old famously landed a plane on the Hudson River in 2009 after a bird struck its engine. All 155 passengers and crew survived.

Sullenberger says he's sharing his hopes -- sharing his story in hopes that others living with the disease will feel that they, too, can step forward.

And a rare T-Rex skeleton has become the world's most expensive fossil ever sold at auction, fetching over $50 million. The skeleton is about 67 million years old and is nicknamed Gus after a South Dakota cattle rancher who owned the land where it was found.

Gus is about 38 feet long, almost 13 feet tall, making it one of the biggest T-Rex has ever discovered. The identity of the fossils buyer right now unknown.

[15:50:00]

Still to come, one of the World Cup's biggest stars may not be playing anymore, but Norway's Erling Haaland has become a viral sensation, along with his whiskey drinking raccoon. We'll discuss next.

(COMMERCIAL BREAK)

KEILAR: Today, two of the biggest favorites in this year's World Cup, France and Spain, are going head to head in a highly anticipated semifinal match in Arlington, Texas. The winner will take on either England or Argentina, who will face off in the other semifinal tomorrow in Atlanta. On Saturday, England was able to advance by surviving an extra time thriller against Norway.

[15:55:00]

SANCHEZ: And even though Norway's exit came earlier than hoped, its superstar Erling Haaland certainly appeared to enjoy his time in the U.S., becoming a breakout star on the pitch. And on social media feeds across the globe.

Felipe Cardenas joins us now as a senior writer for The Athletic. Thanks so much for being with us. So Norway out of the tournament, Haaland, though, making a real impact here in North America. He's a rising star.

FELIPE CARDENAS, SENIOR WRITER, THE ATHLETIC: He's certainly a rising star for the North American audience. He's a prolific scorer. Probably the most prolific scorer in European football, playing for Manchester City.

But there was I think there was a bit of an unknown around him at this World Cup. Norway had not been to a World Cup since 1998. Obviously, that meant that Erling Haaland was coming to this major tournament for the first time.

And not only did he really just like, I think, come out and become a star based on his personality, his looks. Again, remember the Viking rose, which became so synonymous with Erling Haaland. He kind of he could even pass for a cast member on Game of Thrones.

And then he scores seven goals. He's he was right at the top of the Golden Boot race. So he was pushing his national team into the knockout phase.

And the American public just completely fell in love with him on social media. Twenty two million more Instagram followers since the start of the tournament. And he also has said that he just really loved American culture, but specifically Dallas.

Like he was like, I want to come back to Dallas. So just an incredible story to start for him.

KEILAR: I love that he wants to go back to Dallas. That's awesome. So the first semifinal faceoff between Spain and France, what's in store?

CARDENAS: Well, right now, you know, Spain has taken the lead. Spain is up one nil at halftime in this game against France. France, obviously a heavy favorite in the heavy, the biggest contender, I think, for so many people at this World Cup. They're so good.

But Spain is their nemesis. And the last two semifinals of European competition, one was the Nations League semifinal 2025. The other was the European Championship two years ago. Spain beat France in both semifinals. And so right now, Spain has

taken the lead and they're looking like the team to be in the semifinal at Arlington. So I think a really impressive first half from the Spanish side, a team that has not lost in over 30 matches, the defending European champions, obviously. And right now, France on the ropes.

SANCHEZ: And tomorrow, England versus Argentina. They haven't played against each other since 2005, when Lionel Messi was a teenager.

CARDENAS: Yes, and honestly, in like in a major tournament, in an official international match, Lionel Messi has never faced England, you know, not in something with this type of stakes. And obviously, this is a game that will be in Atlanta. I'll be there covering that game live.

And the surrounding storyline about England, Argentina always goes back to the Falklands War, 44 years ago. This is a story that for Argentines means perhaps means a lot more than the English. There are still songs and chants that that Argentine fans sing that like that that refer back to the fallen comrades and the casualties of that war.

And you remember in 1986, Diego Maradona played against England at the hand of God, one of the most controversial goals in World Cup history. Then he follows it up with the best goal, probably from an individual perspective ever. And that really brought that rivalry to the mainstream.

And so these two national teams, two of the best teams, I think, at this World Cup, two teams with game winners and Jude Bellingham, Harry Kane, obviously Lionel Messi just doing what he always does. Now, this is going to be a huge matchup in Atlanta and one that even security forces, security officials here in Atlanta, the Atlanta PD also really tightening up because these two fans, they don't get along. And it has the history between them isn't really great also.

KEILAR: Yes, no, it's a good point. That's going to be a big one. And there's a lot of undercurrents there.

U.S. player Folarin Balogun, who was caught up in the red card controversy, is finally talking. What's he saying?

CARDENAS: Yes, he gave an interview today with CBS. I thought something that he has done since this started. He has been very professional, very eloquent and accepting his role in the controversy of the red card that was then overturned.

And obviously we know that the Trump administration intervened and went directly to FIFA. And then President Trump going publicly saying, yes, I called the FIFA president and I got this red card overturned. Now, Balogun has come out and said that he actually felt that it made his teammates nervous before that round of 16 game against Belgium, which the U.S. ended up losing 4-1. You remember after the game, Balogun went straight to the Belgian manager and apologized, which tells you everything about what was going through his mind over the 90 minutes of that game. Thinking if he's thinking that after the final whistle, I'm going to go apologize. That tells you everything about what was going through his head in that performance.

So I think Balogun today saying that it was not easy.

[16:00:00]

He was happy that he was back in the team initially, but then he realized that it was going to be controversial and that it would impact his teammates. So I think Balogun again standing now as somebody who has been very professional about this, but now also revealing that it certainly did impact the United States in that loss.

SANCHEZ: And that loss certainly didn't fare well for them on the field. Felipe, thank you so much for joining us.

Thank you for being with us this afternoon. "THE ARENA" with Kasie Hunt starts right now.

END