United States President, Donald Trump, assured markets on Monday that US military operations in Iran would soon conclude, offering some relief after a conflict that has sent shockwaves across the Middle East.
The war had driven stock markets down and pushed oil prices higher earlier Monday, following a fresh missile assault by Tehran, under its new leader Mojtaba Khamenei, on neighboring Gulf states.
The attacks also suggested the Strait of Hormuz could remain blocked, threatening one of the world’s most critical oil passages.
Trump, speaking at a news conference in Florida, described the US campaign as a “short-term excursion” and promised, “It’s going to be ended soon, and if it starts up again they’ll be hit even harder.”
His remarks helped Wall Street climb into positive territory, while markets in Tokyo and Seoul opened strongly Tuesday, despite the president’s warnings that the campaign could expand if Iran failed to comply.
Oil prices, which had surged past $100 per barrel, the highest since Russia’s 2022 invasion of Ukraine, reversed, dropping as much as five percent.
Iran’s Revolutionary Guards responded on Tuesday, asserting that they, not the Americans, would “determine the end of the war.”
The new supreme leader, Mojtaba Khamenei, assumed power following the death of his father Ali Khamenei, prompting Iranian forces to launch missile and drone attacks on Saudi Arabia, Bahrain, Qatar, the UAE, and Israel.
A missile was also fired at NATO member Turkey for the second time in five days, though alliance air defenses intercepted it before it could hit its target.
Diplomatic efforts centered on reopening the highly strategic Strait of Hormuz, blocked to nearly all oil tankers.
French President Emmanuel Macron said his country and its allies were preparing a “purely defensive” mission to escort ships “after the end of the hottest phase of the conflict,” though experts warn that naval vessels could face fire from the Iranian coast.
Kamal Kharazi, a foreign policy adviser to Iran’s supreme leader, told CNN that Tehran is relying on economic pressure to eventually compel other countries to intervene and end the conflict.
– Domestic Support in Iran –
Following the appointment of Mojtaba Khamenei as Iran’s first new supreme leader in 37 years, Iranian state media showed tens of thousands celebrating in Tehran, many holding his portrait.
Iran’s allies, including the Houthi rebels in Yemen and Hezbollah in Lebanon, pledged allegiance. Russian President Vladimir Putin also promised “unwavering support.”
Trump said he was “disappointed” by Khamenei’s appointment but remained open to considering an internal replacement, citing Venezuela’s recent transition as “a formula that has been very good so far.”
Ali Ansari, professor of Iranian history at the University of St Andrews, described the new leader as a hardliner who “has been involved in all the most violent repressions that have taken place over the last 15-16 years.”
– Rising Oil Risks –
Oil traders, central bankers, and policymakers are closely monitoring Gulf energy infrastructure. About 10 vessels in or near the Strait of Hormuz have come under attack since Iran blocked the waterway in retaliation for US-Israeli strikes. Shipping giant MSC announced a formal halt on some exports, leaving goods stranded on ships.
After strikes on Bahrain’s Al Ma’ameer oil facility ignited fires, the state-owned energy company Bapco declared “force majeure,” joining counterparts in Qatar and Kuwait in signaling potential export disruptions. Saudi Arabia’s defense ministry also reported thwarting a drone attack on an eastern oil field near the UAE border.
– Escalating Violence Across the Region
In Bahrain, a residential area in Manama was hit in an Iranian attack, killing one person and injuring others, according to the interior ministry. In Israel, around 10 explosions were heard in Tel Aviv after missiles fired from Iran triggered air raid warnings.
At least one Israeli was killed by shrapnel. Israel retaliated by striking an Iranian missile launcher.
The conflict has also intensified in Lebanon, where Israeli-Hezbollah exchanges since March 2 have killed at least 486 people and wounded over 1,300. Lebanese President Joseph Aoun accused Hezbollah of attempting to “collapse” the state, while the group’s parliamentary leader insisted it had “no other option…than the option of resistance.”
