Iran has warned that global oil prices could surge to US$200 per barrel after its forces targeted merchant vessels in Gulf waters, while the International Energy Agency recommended a massive release of strategic oil reserves to cushion what analysts describe as one of the worst energy shocks since the 1970s.
The conflict, triggered nearly two weeks ago by joint airstrikes from the United States and Israel on Iran, has already claimed around 2,000 lives, mostly in Iran and Lebanon, as the fighting spread into neighbouring areas and disrupted global energy markets and shipping routes.
Despite heavy bombardment described by the Pentagon as the most intense since the war began, Iranian forces continued retaliatory strikes on Wednesday, firing missiles at Israel and other targets across the Middle East.
Iran’s Islamic Revolutionary Guard Corps also confirmed its forces had fired on ships in Gulf waters that allegedly ignored military orders. Reports indicated that three vessels were struck during the latest incidents.
Meanwhile, Donald Trump suggested the conflict may continue for now, saying the United States was not yet ready to declare an end to military operations.
Speaking at a rally in Kentucky, Trump said the United States had achieved significant military success but stressed that operations must continue until objectives were completed. He claimed US forces had destroyed 58 Iranian naval vessels and insisted Iran’s military capability had been severely weakened.
Trump also indicated Washington would focus on the strategic Strait of Hormuz, a crucial passage along Iran’s coastline that carries roughly 20 per cent of the world’s oil supply.
Although Trump said ships should be able to pass through the waterway, sources reported that Iran had deployed around a dozen naval mines, effectively tightening a blockade in the channel. Iranian military officials maintained that the strait remained firmly under Tehran’s control.
In response to rising risks to global shipping, leaders from the G7 — comprising the United States, Canada, Japan, Italy, Britain, Germany and France — agreed to explore the possibility of escorting commercial vessels to ensure safe navigation through Gulf waters.
Security concerns have also extended beyond the Middle East. Federal Bureau of Investigation reportedly warned that Iranian drones could potentially target the US West Coast, although Trump downplayed the threat.
The United States Department of State has also cautioned that Iranian-linked militias could target American-owned energy infrastructure in Iraq, including locations previously used by Americans.
Amid growing fears of supply disruptions, global oil prices surged earlier this week to nearly US$120 per barrel before settling near US$90, although prices rose again by about five per cent on Wednesday. The volatility has also weighed on financial markets, with major Wall Street indices declining.
The escalating conflict has already seen Iranian drones and missiles striking ports and cities across the Gulf region, as well as targets inside Israel, intensifying concerns about regional stability.
Iranian military spokesperson Ebrahim Zolfaqari warned that the economic impact could worsen if hostilities persist.
“Prepare for oil prices to reach US$200 per barrel, because the price of oil depends on regional security, which you have destabilised,” he said, addressing Washington.
Following overnight airstrikes that damaged a bank in Tehran, Iranian officials also threatened to target banks doing business with the United States or Israel, warning civilians to keep a 1,000-metre distance from such facilities.
Maritime attacks have also intensified. A Thai-flagged bulk carrier was reportedly set ablaze, forcing crew members to abandon the vessel, while three sailors were reported missing. Two additional ships — a Japanese container vessel and a Marshall Islands bulk carrier — were also damaged by projectiles.
The latest incidents bring the total number of merchant ships hit since the war began to 14, highlighting the increasing danger to commercial shipping routes in the region.
Inside Iran, thousands of people gathered for funeral processions honouring senior commanders killed in airstrikes. The crowds carried coffins and portraits of Ali Khamenei and his son Mojtaba Khamenei.
According to an Iranian official, Mojtaba Khamenei was lightly wounded earlier in the war, during airstrikes that reportedly killed several members of his family. He has not appeared publicly or issued any statement since the conflict began.
Despite calls from Washington urging Iranians to protest against the ruling establishment, there has been little sign of large-scale uprisings. Iran’s police chief Ahmadreza Radan warned that anyone staging street protests would be treated as an enemy rather than a demonstrator, saying security forces remain fully prepared to respond.
