United States and Iran Trade Strikes as Hormuz Returns to the Center of the Oil Market

Fresh strikes between the United States and Iran gave way on Thursday to an abrupt move toward a settlement. After threatening that American forces would hit Iran "very hard" that evening, President Trump canceled the planned strikes and said on his Truth Social platform that the framework of a deal had been approved by all parties involved, naming the United States, Israel, Saudi Arabia and a series of Gulf and regional governments. Iran did not confirm any agreement, and its foreign ministry spokesman, Esmail Baghaei, said no deal had been finalized. The New York Times reported that the preceding exchanges of fire had raised fears of a return to all-out war, and that Tehran now describes the earlier cease-fire as meaningless.

The claims of damage diverge sharply by source. Iran's Islamic Revolutionary Guard Corps (IRGC) said it struck 18 targets at United States bases in Kuwait, Bahrain and Jordan, according to Al Jazeera. United States Central Command, in turn, said it completed a series of attacks on targets inside Iran, and an Iranian cargo vessel sank in the Gulf of Oman after an American strike. President Trump said Israel was not involved in the latest operation.

The most consequential dispute for markets concerns the Strait of Hormuz, the channel through which a large share of seaborne oil passes. Iran has now formally announced that the strait is closed to all tankers and commercial ships, warning that it would fire on any vessel attempting to pass. The United States denies the waterway is shut, as the Indian daily The Hindu noted in its running coverage. Trump said a naval blockade would remain in full force until the deal is signed. Until independent traffic data settles the question, the gap between the two claims is itself a source of price risk.

The confrontation fits a documented pattern of Washington tightening economic and military pressure on Tehran while holding out the possibility of a settlement. Even with a deal reported to be near, the blockade remains in place, which keeps both oil and regional security unsettled.