Oil prices surge after Trump steps up rhetoric, Macron hits back

IN BRIEF

• US President Donald Trump vowed more aggressive strikes on Iran, sending oil prices sharply up again in a blow to consumers around the world. READ MORE BELOW

• Virtual talks among some 40 countries on Thursday were exploring ways to restore freedom of navigation in the Straits of Hormuz. READ MORE BELOW

• French President Emmanuel Macron said it would be 'unrealistic' to launch a military operation to force open the strait. READ MORE BELOW

• Israel reported new incoming salvoes, Saudi Arabia said it had intercepted four drones and Abu Dhabi said it had intercepted a missile.

• The US embassy in Baghdad urged its citizens to leave Iraq, warning of attacks in the capital by Iran-allied militia in the next 24 to 48 hours.

• Benchmark Brent crude prices jumped by about 8% to around $109 per barrel and stocks took a hit after Trump's address.

IN DETAIL

Oil prices surge after Trump vows to step up Iran attacks 

Hopes for a swift end to the Middle East war faded on Thursday after US President Donald Trump vowed more aggressive strikes on Iran, sending oil prices sharply up again in a blow to consumers around the world.

Stocks slid and the dollar gained after Trump said military operations would be intensified without offering the timeline that investors had sought for ending hostilities against Iran.

"We're going to hit them extremely hard over the next two to three weeks. We're going to bring them back to the Stone Ages where they belong," Trump said in a Wednesday evening prime-time speech.

Trump said the US would achieve its military objectives soon but suggested the war could escalate if Iranian leaders did not give in to Washington's terms during negotiations, with strikes on Iran's energy and oil infrastructure possible.

He has said he may end the war with a deal and told countries that rely on fuel shipments through the Strait of Hormuz, which has been all but closed by Iranian attacks, to "just grab it".

Iran's armed forces responded to Trump with a warning for the United States and Israel of "more crushing, broader and more destructive" attacks in store.

The war will continue until the "permanent regret and surrender" of Iran's enemies, said Ebrahim Zolfaqari, spokesperson for the Iranian military's Khatam al-Anbiya central headquarters, in a statement carried by Iranian media.

Countries discuss ways to open Strait of Hormuz 

Iran has shown that it can block the vital Strait of Hormuz by targeting oil tankers and attacking Gulf countries hosting US troops.

While reserving the right to self-defense, Gulf states have not responded militarily to Iran's attacks over the past month to avoid escalation into a far more devastating all-out Middle East war.

European and other states have said they will only help secure the strait if there is a ceasefire. With pressure growing, some 40 countries were exploring ways to restore freedom of navigation at virtual talks on Thursday.

Iran's parliament was reviewing a bill that would formalize the blocking of vessels from hostile countries passing through the strait and the charging of tolls for others wishing to pass, spokesperson Abbas Goodarzi said.

Macron says it's unrealistic to open Hormuz Strait by force 

French President Emmanuel Macron said on Thursday it would be unrealistic to launch a military operation to force open the Strait of Hormuz.

"Some people defend the idea of freeing the Strait of Hormuz by force via a military operation, a position sometimes expressed by the United States, although it has varied," Macron told reporters during a trip to South Korea.

"This was never the option we have supported because it is unrealistic," he said. "It would take forever, and would expose all those who go through the Strait to risks from the Revolutionary Guards but also ballistic missiles," he said.

Macron, who has worked with European and other allies to build a coalition to guarantee free passage through Hormuz once hostilities have stopped, said this could only be done by talking to Iran.

"What we say from the beginning is that this strait must be reopened because it is strategic for energy flows, fertilizers and international trade, but that it can only be done in consultation with Iran," he said.

Asked about Trump's criticism of NATO allies, Macron said:

"I don't want to provide a running commentary of an operation the Americans have decided on their own with Israel. They can deplore the fact they're not being helped, but that's not our operation. We want peace as soon as possible."

"This is not a show," Macron added. "We're talking about war and peace... Let's be serious and not say one day the opposite of what we said the day before," he added, without saying if he was talking about Trump.

On Trump's threats to pull the US out of the NATO alliance, Macron said: "Alliances such as NATO derive their strength from what is not said, that is, from the trust that lies behind them. If you create doubt every day about your commitments, you hollow out its substance."

China says strait is blocked because of 'illegal' US-Israel military actions

The obstruction of navigation through the Strait of Hormuz stems from the illegal military actions carried out by the United States and Israel against Iran, Chinese Foreign Ministry spokeswoman Mao Ning said at a press briefing in Beijing on Thursday.

"The root cause of the obstruction to navigation through the Strait of Hormuz is the illegal military actions by the United States and Israel against Iran. Only by achieving a ceasefire and restoring peace and stability in the Gulf region can the safety and smooth passage of international waterways be fundamentally ensured," said Mao.

"All parties should work together to de-escalate the situation and prevent further regional turmoil from having a greater impact on the global economy and energy security."

Strikes continue amid fears of inflation and migration

Iran said several people were likely injured when a bridge linking Tehran and the western city of Karaj was hit by air strikes. Some of its largest steel producers and Tehran's Pasteur Institute of Iran medical research center had sustained serious damage in the conflict, it said.

The country's Revolutionary Guards said they had targeted US-linked steel and aluminum facilities in Gulf states and would step up such attacks if Iranian industries were hit again.

Israel reported new incoming salvoes on Thursday, Saudi Arabia said it had intercepted four drones and Abu Dhabi said it had intercepted a missile, with minor damage near an economic zone.

The US embassy in Baghdad urged its citizens to leave Iraq, warning of attacks in the capital by Iran-allied militia in the next 24 to 48 hours.

Fuel shortages have already caused economic strains across Asia and they are expected to bite in Europe soon. Italy's foreign minister said migration flows would increase if the conflict were to drag on.

Benchmark Brent crude prices jumped by about 8% to around $109 per barrel and stocks took a hit, with little reassurance from Trump's address about how the strait would reopen.

The International Monetary Fund, World Bank and International Energy Agency on Wednesday warned the war was having "substantial, global and highly asymmetric" effects and said they would coordinate their response, including through potential financial support to those countries hit hardest.

Prospects elusive for near-term resolution 

Trump said US-Israeli strikes had ensured Iran would not obtain nuclear weapons, adding that US forces could return with "spot hits" if the threat resurfaces.

"We are systematically dismantling the regime's ability to threaten America or project power outside of their borders," he said.

Prior to Trump's remarks, Iranian President Masoud Pezeshkian said in a letter addressed to the American people that his country harbors no enmity towards ordinary Americans.

Trump said discussions were ongoing with Iranian leaders he considered less radical than previous leaders.

A senior Iranian source said on Wednesday that Tehran is demanding a guaranteed ceasefire to halt its attacks and said no talks have taken place through intermediaries on a temporary truce.

US Vice President JD Vance communicated with Pakistani intermediaries about the Iran conflict as recently as Tuesday, according to a source briefed on the matter, making clear Trump was open to a ceasefire if certain demands were met.

Pakistan, which has good relations with the US and Iran, had said it hoped to host direct talks between the warring sides soon but its foreign ministry spokesperson said on Thursday there was no confirmation so far of any US plans to attend.