DUBAI/CAIRO/WASHINGTON, (Reuters): Iran’s Revolutionary Guards said on Tuesday they would not allow any oil shipments from the Middle East if attacks by the United States and Israel continue, prompting US President Donald Trump to warn that Washington would respond with much heavier strikes if Iran blocked exports.
Despite the escalating rhetoric, crude prices fell and global stock markets rose after Trump expressed confidence that the conflict would end quickly. His remarks came even as Iran signaled defiance by appointing Mojtaba Khamenei as its new supreme leader.
Trump said on Monday that US forces had inflicted serious damage on Iran’s military and predicted the conflict would end sooner than the four-week time frame he had initially suggested, though he did not define what victory would look like.
Israel has said its goal in the war is to overthrow Iran’s clerical ruling system. Israeli Prime Minister Benjamin Netanyahu said the ultimate outcome depends on the Iranian people but added that Israeli actions were weakening the country’s leadership.
US officials have mainly stated that Washington’s objective is to destroy Iran’s missile capabilities and nuclear programme, but Trump has also said the war can end only when Iran has a compliant government. Iran’s UN ambassador said at least 1,332 Iranian civilians have been killed and thousands wounded since US and Israeli air and missile strikes began across Iran at the end of February.
Trump warned that US attacks could intensify sharply if Iran attempts to block tanker traffic through the Strait of Hormuz, which carries about one-fifth of the world’s oil supply. He said the United States would strike Iran much harder if the flow of oil through the strait were disrupted.
Iran’s Islamic Revolutionary Guard Corps responded that it would prevent any oil from leaving the region if the attacks continue. A spokesperson said Iran would determine when the war ends and dismissed Trump’s comments as “nonsense”.
In a later post on Truth Social, Trump repeated his warning, saying Iran would be hit “twenty times harder” if it interfered with oil shipments through the Strait of Hormuz.
Saudi Aramco, the world’s largest oil exporter, warned of catastrophic consequences for global oil markets if the conflict continues to disrupt shipping through the strait, which connects the Gulf’s major oil producers with the Gulf of Oman and the Arabian Sea.
The conflict has already effectively shut the Strait of Hormuz for more than a week, leaving tankers unable to sail and forcing producers to halt pumping as storage facilities fill. Iranian Foreign Minister Abbas Araqchi said Tehran is unlikely to resume negotiations with the United States after Washington launched strikes despite previous rounds of talks.
The appointment of Mojtaba Khamenei to succeed his slain father, Ayatollah Ali Khamenei, had earlier driven oil markets higher and pushed stock markets down. Markets later reversed course after Trump predicted a quick end to the conflict and after reports that some sanctions on Russian energy could be eased.
After speaking with Russian President Vladimir Putin, Trump said the United States might waive oil-related sanctions on some countries to ease the global supply shortage. That could include further easing restrictions on Russian oil exports, according to several sources.
Other options under consideration include releasing oil from strategic reserves or restricting US exports to stabilize supply.Brent crude futures fell more than 10 percent on Tuesday after surging as much as 29 percent the previous day to their highest level since 2022. Global stock markets also recovered.
Rising fuel prices remain a key political issue in the United States ahead of the November midterm elections, when Trump’s Republican Party will try to retain control of Congress.
