USIsrael

United States President Donald Trump is scheduled to address a defence summit at the US Army War College on Wednesday, where he is expected to laud US investments in its armed forces that he has argued have helped add a new edge to history’s most powerful military.

But his speech comes at a time when the US’s war on Iran has significantly depleted the US military’s weapons stockpile.

The summit, which will be held in Carlisle, Pennsylvania, comes as the US has re-ignited attacks on Iran in the past week, and as Trump has threatened to continue a war that, according to recent US polls, is highly unpopular among Americans facing high costs of living.

The US has expended half of at least four of its most critical munitions since its war on Iran began on February 28, and has racked up billions of dollars in weapons expenses, analysis shows.

Replenishing low stockpiles could take anywhere between several months and several years. Analysts warn that a shrinking arsenal could put the US in a less formidable position in a potential future conflict – particularly against China.

Here’s what we know about the US weapons inventory:

What’s happening with the US-Iran war?

Following an April ceasefire between the US and Iran, and the subsequent signing of a memorandum of understanding in June, the conflict kicked off again after the US Central Command launched heavy waves of attacks on Iran’s military sites last Wednesday, saying it was aiming to degrade Tehran’s military capabilities. Huge, hourlong attacks have continued for four nights since Sunday, including on railway tracks and bridges.

Both sides traded low-intensity attacks throughout the ceasefire period. However, the US escalated air attacks last week after Iran fired on three commercial ships passing through the Strait of Hormuz – because those vessels had used a shipping route not approved by Tehran.

Each blames the other for violating the ceasefire, and at last week’s NATO leaders’ summit, Trump declared the pact with Iran over, although he said American negotiators could continue talks. Washington has also reinstated a naval blockade on Iran-linked ships trying to transit the waterway and has re-imposed sanctions on Iran.

Iran’s Islamic Revolutionary Guard Corps has responded with retaliatory attacks on US military assets in Bahrain, Oman, Qatar and Kuwait.

More than a dozen people have been killed in Iran since the new wave of US attacks, including civilians.

“We’re going to knock out all their power plants. We’re going to knock out all their bridges unless they get to the table and negotiate,” Trump threatened in a Fox News interview that aired on Tuesday.

Attacking civilian infrastructure is a violation of international law.

Does the US have enough weapons to keep attacking Iran?

Washington’s supplies are running low but have not reached a critical level, according to analysis of the US weapons inventory by the Center for Strategic and International Studies (CSIS), a Washington-based think tank.

In the 39 days of conflict between the start of the US-Iran war in February and the ceasefire in April, the US hit more than 13,000 targets, focusing mainly on using seven of its most powerful missiles and air defence systems: Tomahawk missiles, Joint Air-to-Surface Standoff Missiles (JASSM), Precision Strike Missiles (PrSM), Standard Missile-3 (SM-3), Standard Missile-6 (SM-6), Terminal High Altitude Area Defenses (THAAD) and Patriots.

For at least four of the munitions, Washington likely expended more than half of its available stockpiles, although many lower-grade alternatives are still in stock, according to CSIS. Government data on weapons inventory is classified.

Here’s how the munitions were used:

• Tomahawks – The US had about 3,000 of the long-range missiles that are fired from sea at ground targets. It likely used up more than 1,000 in the war on Iran.
• JASSM – About 4,000 of these stealthy, air-launched long-range missiles were in the US inventory before the war. About 1,100 were used in the war on Iran.
• PrSM – Supplies of the newly delivered, ground-launched long-range missiles were already low to start with, with deliveries since 2023 amounting to a total of 90. An estimated 40-70 were used in the war. One US military official claimed that the “entire” inventory had been expended.
• SM- 3 – The most expensive weapon per unit at $28m, these ship-launched ballistic missile interceptors numbered about 410 before the war. The US has used between 130 and 250 of these in the war on Iran.
• SM-6 – Also ship-launched, this missile is mainly used to intercept aircraft and cruise missiles. The US had about 1,160 stockpiled. An estimated 190- 370 have been expended in the Iran war.
• THAAD – The US had about 360 of the costly anti-ballistic missile systems by April, and between 190 and 290 were used in the war. The US has a total of 8 THAAD units or “batteries” consisting of launchers, interceptors, and radar systems.
• Patriot – An estimated 2,330 Patriots were in stock before the war, but between 1,060 and 1,430 have been expended. Some older versions may also likely be available – about 400 of them.

What does this mean?

Analysts from CSIS say that while the US may have enough to continue hitting Iran in the near-term war, it has reduced its stockpiles so significantly that it may not have enough for potential future wars, especially against a formidable rival like China.

Replenishing high-capability and costly weapons like the ones the US has used in Iran will likely take several years.

Trump and senior administration officials have publicly maintained that the US has an “unlimited” supply of weapons as the US-Iran war has raged on.

However, in March, Trump said administration officials met with the heads of US manufacturers, including Lockheed Martin, Boeing, Raytheon, BAE Systems, Honeywell Aerospace, L3Harris Missile Solutions, and Northrop Grumman. He said all promised to “quadruple” production and that increased manufacturing was already under way.

Subsequently, in June, Trump signed the Defense Production Act, an executive order compelling US weapons manufacturers to speed up production, citing existing conditions “which may pose a direct threat to the national defense or its preparedness programs”.

An order compelling private actors to ramp up production likely reflects timeline concerns within the Pentagon, analysts note.

In the short term, Washington is also unlikely to meet demands from its allies, and may not have the capacity to supply the THAADs and Patriots that Ukraine says are crucial in its war against Russia.

Already, supply orders have hit road bumps. Japan’s order of 400 Tomahawks from Raytheon was meant to be delivered between 2025 and 2027, but US Defense Secretary Pete Hegseth said in May that two more years could be added to the schedule.

Meanwhile, Switzerland began negotiations with France, Israel and South Korea in June to buy another missile defence system after its 2022 order from Lockheed Martin and Raytheon continued to face delays.

How long will replenishing weapons take?

Hegseth said in May that it could take “months and years” to replenish the supplies, based on the weapons system.

Analysts reckon it could take the US between one and four years to get its most exquisite munitions stockpiles back to pre-Iran war levels, even as Trump has boasted that new weapons plants are being built around the US and production is being ramped up.

Trump’s administration is set to buy large amounts of advanced munitions in its proposed $1.5 trillion 2027 defence budget – a 44 percent increase from 2026’s defence budget.

According to CSIS, estimated timelines to replenish the seven critical munitions, based on existing production facilities, are:

• Tomahawk: Between 4- 5 years (207 will be delivered in 2026, while 785 have been requested for 2027).
• JASSM: 1 year (821 to be delivered in 2026 and 821 requested for 2027).
• PrSM:  8 months (70 to be delivered in 2026 and 1,134 requested for 2027).
• SM- 3:  3 years ( 52 to be delivered in 2026 and 214 requested for 2027).
• SM-6:  3 years (125 to be delivered in 2026, and 540 requested for 2027).
• THAAD: 3 to 3.5 years (92 to be delivered in 2026, and 857 requested for 2027).
• Patriot: 3 years (172 to be delivered in 2026, and 3202 requested for 2027).

Military and defence analyst Alex Alfirraz Scheers says the US risks falling into an ‘escalation trap’ if it launches a ground assault in Iran because Tehran still retains a large number of ballistic missiles.

The United States carried out attacks against Iran for a third consecutive night late on Monday.

Iran has continued to hit targets in the Gulf in several waves of retaliatory strikes on Tuesday, including UAE‑flagged oil tankers in the Strait of Hormuz and US military facilities in Bahrain and Kuwait.

Here is a recap of what has happened on Monday night and Tuesday, and what each side has said.

Where did the US attack Iran?

US Central Command, the military’s regional command known as CENTCOM, said its latest strikes began at 4:45pm ET (20:45 GMT) on Monday and were aimed at degrading Iran’s capacity to attack “innocent civilians and commercial shipping” in the strait.

CENTCOM later announced the conclusion of its strikes and said the latest round of attacks on Iran lasted five hours. It added that US forces “successfully struck military targets across Iran including Bushehr, Chah Bahar, Jask, Konarak, Abu Musa, and Bandar Abbas”.

Iranian state television and semi-official news agencies reported explosions throughout the night across the country’s southern coast, including the port city of Bandar Abbas, and on Kish and Qeshm islands, as well as the town of Jam in Bushehr province.

A projectile that struck western Bandar Abbas caused no casualties, the Fars news agency reported, citing the regional governor’s office.

What areas did Iran target?

For its part, Iran’s Islamic Revolutionary Guard Corps (IRGC) said it had launched a wider retaliatory campaign against US allies and interests across the Gulf.

Iran’s Tasnim news agency reported that Iranian forces had struck several “violating” vessels in the strait, and that a US-made drone had been shot down near Bandar Abbas.

The UAE: The UAE said two of its oil tankers had been hit by Iranian cruise missiles in Omani waters in the Strait of Hormuz. The UAE added that one Indian national crew member had been killed on one of the tankers, and eight other people were wounded.

Iran’s Tasnim news agency said the IRGC hit two “offending” oil supertankers, citing an IRGC statement – apparently referring to the two UAE tankers.

Kuwait: The Iranian army said on Monday that it had carried out a drone attack on US military targets in Kuwait. In a statement posted by state broadcaster IRIB, the army said it launched drones at a US Patriot missile system, fuel tanks, a watchtower, an ammunition depot and communication systems.

Bahrain: The IRGC said it targeted “several weapons storage depots, a satellite communications centre, and a building housing US forces” at al-Juffair Base in Bahrain. It also said it had hit the US Fifth Fleet in Bahrain with missiles and drones.

Air sirens have been heard four times in Bahrain on Tuesday so far.

Jordan: Jordan’s army said it shot down four missiles in Jordanian airspace that were fired from Iran, according to the official Petra news agency. After this, the IRGC said it launched ballistic missiles at US forces and key facilities at an airbase in Jordan.

In a message addressed directly to Jordanians, the IRGC insisted that the operation was aimed at the US military presence in the country rather than at Jordan or its citizens. “You know that we hold no animosity toward your country. On the contrary, we deeply love you, the noble people. You understand the pain and suffering of the Palestinian people better than any other nation, and you are aware of the crimes of the Zionist regime in the massacre of 70,000 Palestinians, including 20,000 children in Gaza, carried out with the direct involvement of the United States,” it said.

What have the US and Iran said?

US President Donald Trump formally notified Congress on July 10 that fighting with Iran had resumed on July 7, invoking his authority to keep US forces in combat for another 60 days without lawmakers’ approval.

At a news conference on Monday, Trump said Iran’s offensive capabilities were being dismantled, but he still thinks a “deal is possible” despite the return to open fighting.

Trump also repeated an earlier demand that Gulf nations help cover the cost of protecting shipping, saying Washington was “protecting a very rich portion of the world” and expected to be paid for it.

On Monday, Trump also threatened to “take out” Kuh-e Kolang Gaz La, also known as Pickaxe Mountain, a suspected nuclear site near the Natanz uranium enrichment facility in central Iran.

Meanwhile, the US blockade on Iran, confirmed by the US Navy-led Joint Maritime Information Centre (JMIC), is due to begin at 20:00 GMT on Tuesday.

The US’s blockade covers Iran’s ports and terminals along the entire southern coastline, according to JMIC.

Ebrahim Azizi, the head of the Iranian Parliament’s National Security Committee, has warned that Iran remains steadfast in defending its red lines, following the formal introduction of a bill to manage the Strait of Hormuz.

In an X post on Tuesday, Azizi wrote: “Last night, coinciding with the downing of US drones, the ‘Strategic Action for the Security and Sustainable Progress of the Strait of Hormuz and the Persian Gulf’ bill was formally introduced in Iran’s Parliament. We remain steadfast in defending our red lines, particularly regarding the management of the Strait of Hormuz.”

What is happening to shipping in Hormuz?

Oil prices rose more than 9 percent on Monday, with Brent crude climbing to about $81 a barrel, its highest level since mid-June.

Kpler, the ship-tracking firm, said crossings through the strait fell by about 52 percent between July 10 and July 12, compared with the previous week.

Islamabad, Pakistan – A wooden panelled bookshelf behind him, Pakistani Prime Minister Shehbaz Sharif signed the memorandum of understanding (MoU) between the United States and Iran, aimed at extending their ceasefire by creating a pathway towards long-term peace.

Sharif then held up the document for the cameras. That was June 17, the high point of a frenzied diplomatic effort led by Pakistan spanning weeks, which had culminated in the MoU that Sharif signed as a mediator.

Yet less than four weeks later, Pakistan’s Ministry of Foreign Affairs has, in just the past few days, issued two statements expressing “deep concern” over renewed US-Iran hostilities, with the MoU Islamabad had helped pull together seemingly in shreds.

On Monday morning, the US launched the latest in a series of attacks on Iran, which responded by firing missiles and drones at multiple Gulf and Arab nations that it blamed for hosting US military bases.

Hours later, Iranian Foreign Ministry spokesman Esmaeil Baghaei told reporters that mediators, including Pakistan, Qatar and Oman, remained engaged and were continuing their efforts, even as he warned that Iran would continue responding to what it viewed as US non-compliance with the MoU.

So far, those efforts have failed to slow down the fighting, even as Pakistan has pressed on with diplomatic outreach.

On Sunday, Deputy Prime Minister and Foreign Minister Ishaq Dar spoke by phone with Iranian Foreign Minister Abbas Araghchi, telling him that dialogue and diplomacy remained “the only viable path” to resolving the crisis.

Prime Minister Shehbaz Sharif also spoke to Iranian President Masoud Pezeshkian on Friday, warning that “hard-earned” peace gains were at risk, while Dar held a separate call on Saturday with Saudi Foreign Minister Prince Faisal bin Farhan Al Saud.

To many analysts, one question, above all, now stares at Pakistan and other mediators like Qatar: With the deep distrust between the US and Iran only further expanding following the new bout of fighting, can Islamabad or any other capital once again bring Washington and Tehran back to the negotiating table?

Repeated breakdowns

The renewed fighting marks at least the third occasion since the US-Iran ceasefire signed on April 8 appeared to have collapsed.

Days after that truce was agreed on, the breakdown of the first round of Islamabad talks led to the US imposing a naval blockade on Iranian ships in the Strait of Hormuz. The US and Iran both attacked ships in the days that followed.

Then, after the MoU was signed on June 17, Iran attacked several ships that it claimed were passing through the Strait of Hormuz without its permission, prompting another escalation with Washington.

But the Iranian tanker strikes last week appear to have raised tensions to new heights.

US attacks on Iran since then have hit at least 10 provinces, killing a soldier, several fishermen in the southern province of Hormozgan, and a firefighter in Sistan and Baluchestan, according to Iranian authorities.

A railway bridge on a trade corridor linking Iran with Central Asia and China was also struck, along with a bridge near Mashhad used by mourners travelling to former Supreme Leader Ayatollah Ali Khamenei’s funeral.

The renewed hostilities have also pulled Qatar, a fellow mediator alongside Pakistan, more directly into the conflict. On Sunday, Iranian missiles and drones hit the Gulf state, with debris from interceptions injuring three people, including a child, according to Qatar’s Ministry of Interior.

Iran’s Ministry of Foreign Affairs has accused Washington of violating “nearly all parts” of the June agreement within 25 days of its signing, citing attacks on transport infrastructure and fishing vessels.

Baghaei said on Monday that Iran had “acted in good faith” throughout, but that “each time the other party has failed to meet its obligations, we did not uphold ours, and we will continue to act in this manner.”

Since the war began on February 28, Islamabad has played the role of mediator.

It hosted talks in April, the first time in four decades that US and Iranian officials sat in a room together.

Its army chief and interior minister have travelled to Tehran several times. In late March, Pakistan also helped secure a Chinese-backed peace framework alongside its own diplomatic efforts.

In June, it helped produce the MoU signed by Pezeshkian and US President Donald Trump, along with Pakistani Prime Minister Shehbaz Sharif, which was then discussed at the Burgenstock summit in Switzerland.

Yet analysts say Pakistan lacks the means to enforce the agreements it helps broker.

Javad Heiran-Nia, director of the Persian Gulf Studies Group at the Center for Scientific Research and Middle East Strategic Studies in Tehran, said the MoU was never intended to resolve the underlying dispute.

“The MoU deferred key and substantive issues to future negotiations and functioned primarily as a tactical instrument to halt hostilities and reopen the Strait of Hormuz to international shipping,” he told Al Jazeera.

Iran, he said, sees control of the waterway as “a strategic asset; not merely a coercive lever, but a deterrent tool”, and appears “prepared to accept the risk of war to preserve this strategic advantage”.

Mediators, he added, lack the instruments to resolve the dispute “unless a shift in the balance of power between Iran and the United States emerges as a result of limited military engagements”, pointing to a potential US naval blockade as one of the few developments that could alter the strategic calculus.

Dania Thafer, executive director of the Gulf International Forum in Doha, said Pakistan’s room for manoeuvre had narrowed as both sides hardened their positions over the strait.

“Pakistan is in a situation where it is highly dependent on both parties, as it always has been, but right now, Iran is bent on establishing its control over the Strait of Hormuz,” she told Al Jazeera.

According to Thafer, there is little Pakistan can do to de-escalate while both Washington and Tehran remain in “an escalatory phase”.

“Once they feel they have reached a point where the balance tips in favour of one side or the other, then perhaps they will return to the negotiating table,” she added.

But Qamar Cheema, head of the Islamabad-based Sanober Institute, pushed back on the idea that Pakistan is operating without real tools.

He pointed to US Vice President JD Vance’s recent remarks, where he credited Pakistani Field Marshal Asim Munir’s role in the process, as evidence that Islamabad’s military-diplomatic channel carries real weight in Washington.

Access itself, he argued, is the instrument.

“Pakistan enjoys trust, and that’s why both sides pick up the phone and call Pakistani leadership any time to remove a stumbling block,” Cheema told Al Jazeera.

Crowded diplomacy, narrowing options

But Pakistan has not been the only diplomatic channel, and according to Heiran-Nia, the dispute over the strait was never really Islamabad’s to mediate.

“Iran had previously removed the Strait of Hormuz issue from Pakistan’s mediation agenda, as the matter was essentially bilateral between Tehran and Muscat,” he said.

Tehran, he explained, did not want the issue to be “defined within a broader negotiation package under Pakistani auspices, which would have afforded Washington room for political manoeuvre”.

Direct Iran-Oman talks followed, but “US military pressure and economic sanctions threats against Oman have placed Muscat under considerable strain, preventing meaningful progress,” according to the Tehran-based analyst.

Meanwhile, he cautioned that Sunday’s attacks on Qatar “could have adverse effects on Qatar’s mediatory role”, although Doha “does not currently appear inclined to withdraw”, adding that “Iran should not assume that Doha’s patience is limitless.”

Mustafa Hyder Sayed, executive director of the Pakistan-China Institute in Islamabad, described the GCC states as caught in an uncomfortable position.

“The GCC countries are caught between the devil and the deep blue sea. They want a functional relationship with Iran while not openly declining the use of their bases and territory by the United States, because they understand they cannot choose their neighbours,” he told Al Jazeera.

Meanwhile, Israel, which is not a party to the MoU, has continued military operations in Lebanon, which Tehran cites as an ongoing violation of the agreement.

Israeli Defence Minister Israel Katz said on Saturday that southern Lebanon “would become Gaza”, raising the prospect of further regional escalation.

Who blinks first?

Despite a week of escalating attacks, the core dispute remains unchanged.

Washington and Tehran remain divided over the same issue that stalled negotiations even before the latest round of fighting: Who controls passage through the Strait of Hormuz, and under what conditions?

Iran insists the MoU gave it authority over transit through the waterway. The US disputes that.

On Monday, Trump announced that the US was reinstating a naval blockade of Iranian ships and would charge a 20 percent tariff on all other ships trying to pass through the strait.

Yet, earlier, a possible compromise had briefly emerged.

Heiran-Nia said the parties explored a formula under which commercial vessels would coordinate passage with both Iran and a designated Arab Gulf state, allowing “both parties [to] claim a degree of victory”.

The talks stalled before reaching a conclusion, however, interrupted by the funeral of Iran’s former Supreme Leader Ayatollah Khamenei, who was killed on the first day of the war in joint US-Israeli air strikes.

The conflict has since moved in the opposite direction, with military action aimed at shifting the balance of power rather than reviving negotiations.

“The prevailing trajectory now is the continuation of military strikes in an effort to shift the balance of power. Yet, there remains a risk that strategic calculations on either side could spiral beyond control,” Heiran-Nia said.

Thafer believes that, despite the violence, neither side has formally abandoned the MoU.

“Iran is framing this current round of escalation as a violation of the MoU rather than a reason to exit it, which means there could still be light at the end of the tunnel,” she said.

In her assessment, both sides bear responsibility for violating the agreement, from Iran’s attacks on shipping to Washington’s revocation of Iran’s oil sale licence and the military attacks. Yet the agreement remains, at least formally, in place.

Its future, she said, depends on which side ultimately gives ground over the strait. Iran retains what Thafer described as a “snapback capability” to disrupt shipping whenever it chooses.

“It is, militarily, very difficult to fully neutralise that Iranian capability. We will have to wait and see where the leverage finally sits,” she said.

Cheema, for his part, argued that Iran’s own conduct, more than any mediator’s diplomacy, is what will decide how this settles.

“Iranian authorities seem ambitious and aggressive, and are looking to take risks to project power, which makes it less likely that any agreement will reach a final conclusion. That means interventions from mediators will keep coming.”

US is carrying out more attacks on Iran, with Iranian media reporting explosions in Kish Island, Jam Island, Qeshm Island, Bushehr and Bandar Abbas.

London debuts new powers targeting state proxies after accusing Iranian military organisation of engineering anti-Semitic attacks.

The British government is pressing to use new powers allowing it to criminalise state proxies in order to designate Iran’s Islamic Revolutionary Guard Corps (IRGC) as a threat to national security.

In a statement issued on Monday, the government announced that it was submitting draft regulations to the UK Parliament that would ban support for the IRGC. The move follows a series of anti-Semitic attacks in the United Kingdom.

In the statement, the government said the submission of the legislation was part of an attempt to “crack down on foreign state-backed activity in the UK”, noting this would include “espionage, foreign interference in our democracy, sabotage and physical attacks”.

Following the designation, it will be a criminal offence to invite support for or express support for the military organisation, assist them in carrying out UK-related activities, engage in conduct likely to materially assist them, or accept or retain material benefits provided by or on their behalf, according to the report.

Apart from the IRGC, the UK government also listed the Islamic Movement of Companions of the Right (IMCR), an Iran-backed group that claimed seven attacks on Jewish sites in the UK earlier this year, and Russia’s military intelligence agency, the GRU Volunteer Corps, as “the first bodies designated under landmark new state threats powers”.

British police have investigated attacks on Jewish-linked sites in London, including the torching of four ambulances belonging to a community charity in March, as anti-Semitic hate crimes. Three men were charged with arson in April.

“If approved by Parliament later this week, those conducting acts of sabotage including arson on behalf of these groups could face life imprisonment,” the statement added.

Caretaker Prime Minister Keir Starmer said: “These new powers will make it easier to prosecute and lock up anyone carrying out their dirty work here in Britain.”

The new legislation gives the UK government “proscription-like” powers to designate foreign state proxies deemed a threat to the UK’s national security. It will mean that prosecutors do not need to establish a foreign power connection in cases involving designated groups.

“Iran and Russia are using proxies and thugs to do their dirty work on our shores. I have rapidly designated three groups so those working for them will be tracked down and put behind bars,” Home Secretary Shabana Mahmood said.

Reporting from London, Al Jazeera’s Charlie Angela said the designation could come into force “as early as Friday”.

“What that’s going to mean is it will become a criminal offence to support the groups in any way or to help them operate, and that could carry a maximum sentence of life imprisonment,” Angela said.

“Diplomatically, it is going to mark a further deterioration in the relationship between Iran and the UK. Earlier, Foreign Secretary Yvette Cooper summoned the Iranian ambassador to the Foreign Office and questioned him. And that is likely going to get a strong response from Iran.”

The government said the IRGC has “a long history of using proxies and criminal networks to target people overseas – particularly the Jewish community and Iranian dissidents”.

Tehran, ⁠which is still at war with the United States and Israel, has previously denied using proxies.

Regarding the GRU military intelligence service, the government said Russia was using the group “for foreign intelligence collection and hostile covert operations and has a long record of targeting the UK and its allies”.

Iran’s Islamic Revolutionary Guard Corps (IRGC) has targeted US military facilities in Bahrain, claimed it has destroyed radar systems in Oman and hit Jordan and Kuwait in its latest round of overnight retaliatory strikes against the United States.

Tehran’s attacks on Monday came as a response to Washington’s escalating strikes as prospects of peace between the two countries recede.

Here is a recap of the latest attacks:

Where were the latest Iran attacks?

Oman: The IRGC said it attacked Oman as part of its latest phase of retaliation. It said it targeted “the FPS long-range aerial radar and the vessel detection radar in Oman”, adding that these radar systems were destroyed.

Bahrain: The IRGC also said it launched missile and drone attacks targeting “installations and infrastructure of the aggressive US army” in Juffair, Bahrain.

Bahrain’s Ministry of Interior said on Monday that sirens had been sounded in the country as it warned people to remain calm and head to the nearest safe place.

The IRGC earlier said it targeted several facilities at the Sheikh Isa Air Base in Bahrain.

Jordan: Jordan’s military said on Monday that it intercepted and downed “four missiles that entered Jordanian airspace” and came from Iranian territory.

Earlier, the IRGC said it targeted Jordan’s Prince Hassan Air Base with missiles and drones and set fire to several fuel depots and ammunition storage facilities.

Kuwait: The IRGC said on Monday that it also targeted a US surface-to-surface missile base in Kuwait, “setting fire to two HIMARS missile launchers and missile-packed warehouses, completely destroying them”.

HIMARS stands for high mobility artillery rocket systems, which are mobile rocket launchers manufactured by the US.

Earlier, the General Staff of Kuwait’s Army said air defence systems were engaging “hostile aerial targets” inside the country’s airspace.

It said any explosions heard were the result of air defence systems intercepting the attacks and urged the public to follow safety and security instructions.

Where was Iran hit?

The US military’s Central Command (CENTCOM) earlier said it hit “dozens of targets at multiple locations with precision munitions to degrade Iran’s ability to continue attacking international shipping flowing through the Strait of Hormuz”.

These targets included “Iranian military air-defense systems, coastal radar sites, missile and drone capabilities, and small boats”, it said.

CENTCOM said it deployed “US fighter aircraft, naval vessels, one-way attack aerial drones, and one-way attack sea drones for the first time”.

Valiollah Hayati, the deputy governor for security and law enforcement in western Iran’s Khuzestan province, told the semiofficial ISNA news agency on Monday that US forces attacked at least eight locations across Khuzestan overnight.

Hayati also said one person was killed and four were injured when a projectile hit an agricultural water-pumping station in Mahshahr, according to the IRNA news agency.

Iran’s Tasnim News Agency reported on Monday that a US-manufactured LUCAS (low-cost uncrewed combat attack system) suicide drone was “accurately hit and shot down” in Bandar Abbas, a city on the Strait of Hormuz.

What has each side said?

The Iranian Ministry of Foreign Affairs released a statement on Monday condemning the US strikes on targets in Iran.

US President Donald Trump insisted that the Strait of Hormuz was open during an appearance on the NBC TV network’s Meet the Press programme on Sunday.

“They’re very, very evil and sick people. We had meetings with them. They agreed to a deal yesterday, a perfect deal for us. No nuclear, no this, no that, no nothing. They gave up everything. And then after that, they left the room. And then within an hour, they launched a drone at a ship,” Trump said.

When did the conflict reignite?

On July 6, the IRGC struck three commercial vessels, including a Qatari liquefied natural gas tanker, off Oman. Iran accused the ships of trying to pass through the Strait of Hormuz without its permission. Tehran’s interpretation of a key clause in the June memorandum of understanding (MoU) with the US gives it the authority to manage traffic through the waterway.

The following day, the US said it carried out strikes on Iranian military targets. Tehran in turn responded with missile and drone attacks on military bases across the Gulf where US forces are deployed.

On Wednesday, Trump told reporters the MoU was over, and on Saturday, the IRGC said the Strait of Hormuz was closed yet again.

How has this impacted the Strait of Hormuz and shipping?

The number of vessels transiting the Strait of Hormuz has fallen to its lowest level in five weeks, according to shipping data.

Six ships sailed through the strait on Sunday, according to data from the trade intelligence firm Kpler, including the Humanity and the Capetan Andreas, transporting 2 million barrels of Iranian oil and 500,000 barrels of Kuwaiti petroleum products, respectively.

Three empty tankers also entered the Gulf to load oil, according to the data.

Retired US General Mark Kimmitt warns renewed attacks in the Strait of Hormuz could push the US and Iran back towards wider conflict.

Oil prices have jumped amid the latest outbreak of hostilities between the United States and Iran over the Strait of Hormuz.

Brent crude, the main international benchmark, rose more than 4 percent on Monday as Washington and Tehran traded attacks amid their escalating standoff over control of the critical waterway.

Brent futures for September delivery stood at $79.26 a barrel as of 05:00 GMT, the highest since June 22.

US Central Command (CENTCOM) said on Sunday that it had carried out dozens of strikes on Iran to degrade its ability to attack vessels in the strait, hours after striking hundreds of targets in the country.

US forces launched the earlier round of strikes after accusing Iranian forces of “blatantly” attacking a Cyprus-flagged container ship, the MV GFS Galaxy, as it was transiting the strait.

“The Strait of Hormuz is a vital maritime corridor for global trade. Iran does not control it,” CENTCOM said in a statement late on Sunday.

“US forces are postured and prepared to ensure that freedom of navigation remains available to commercial shipping despite Iran’s continued unwarranted aggression, harassment, threats, and arbitrary declarations.”

Iranian forces on Sunday launched a wave of missile and drone attacks against the United Arab Emirates, Qatar, Kuwait, Oman and Bahrain in response to the US strikes.

Iran’s Persian Gulf Strait Authority, which claims the right to control traffic through the Strait of Hormuz, earlier reiterated that vessels attempting to cross the waterway without using its preferred route would “not be covered by safe passage guarantees”.

“The consequences arising from transit through unauthorized routes shall be the responsibility of the owner, operator, and vessel commander,” the authority said.

After ticking up following Washington and Tehran’s signing of a memorandum of understanding on ending the war last month, maritime traffic in the Strait of Hormuz has declined sharply amid the renewed fighting between the sides.

Just six vessels were tracked crossing the strait between 18:00 GMT on Thursday and 06:00 GMT on Friday, compared with 18-22 daily crossings earlier this month, according to maritime intelligence platform Windward.

Nine vessels were tracked in the waterway between 18:00 GMT on Saturday and 06:00 GMT on Sunday, four of which were flying the Iranian flag, according to Windward.

Roughly 130 vessels transited the strait, a conduit for one-fifth of the global oil trade in peacetime, each day before the start of the war.

Oil prices, which had returned to pre-conflict levels following the signing of the memorandum on June 17, are now about 9 percent higher than before the US and Israel launched their initial strikes on Iran in late February.

Mukesh Sahdev, founder and chief oil analyst at XAnalysts in Sydney, Australia, said he expects the per-barrel price of Brent to remain in the upper $70s during August and September amid the heightened geopolitical uncertainty.

“There could be occasional spikes and dips outside that range,” Sahdev said in a note to clients on Saturday.

“Long-haul procurement forces refiners to make supply decisions weeks in advance,” Sahdev added.

“Those decisions have already reduced immediate reliance on the Middle East, and the latest escalation is likely to reinforce rather than reverse that trend.”

Fabien Yip, a market analyst at IG in Sydney, Australia, said prices are unlikely to approach the much higher levels seen earlier in the war despite the latest turmoil.

“Oil’s return towards pre-war levels in June reflected markets pricing in a best-case outcome for the fragile US-Iran arrangement; last week’s re-escalation exposes how fragile that assumption was,” Yip said in a note to clients on Monday.

“Near-term, the risk premium should keep prices supported, though a repeat of the earlier spike appears unlikely, as demand remains slow to recover while stranded-tanker releases and OPEC+ output quota expansion continue to add barrels to an already oversupplied outlook.”

Major Asian stock markets fell on Monday amid the renewed fighting in the Middle East.

Japan’s benchmark Nikkei 225 fell more than 2 percent in afternoon trading, while South Korea’s Kospi plunged more than 8 percent.

Hong Kong’s benchmark Hang Seng Index dipped about 0.2 percent.

The US has launched a new wave of strikes on Iran targeting what it says is Tehran’s ability to threaten shipping in the Strait of Hormuz. US President Donald Trump has declared the waterway open while Iran insists it is closed leading to a further escalation of attacks, as Heidi Zhou Castro reports from Washington DC.

Iranian state media report explosions in port cities pof Bandar Abbas, Sirik and Jask, as well as Qeshm Island.

Tehran, Iran – Several days of military attacks by the United States across Iran have marked the most intense rounds of bombardment since the two sides reached a vague memorandum of understanding last month.

US fighter jets and warships have hit hundreds of military targets and a number of civilian ones in nearly a week of strikes, with Iranian authorities reporting attacks in at least 10 provinces, mainly in southern Iran near the strategically important Strait of Hormuz.

In Tehran, life for more than 10 million people has carried on mostly as usual since the capital has not been recently attacked. But the economy is in the doldrums and the outlook is increasingly uncertain, more than four months after the US and Israel began their aerial campaign.

“Everything is too chaotic right now to guess what will happen next but it doesn’t look good,” Farshad, a 21-year-old resident of eastern Tehran, said on Sunday.

“I just really hope all-out war doesn’t start again because I don’t have the nerve for daily bombing on top of everything else,” he told Al Jazeera.

The Islamic Revolutionary Guard Corps (IRGC) said overnight into Sunday that the Strait of Hormuz was once again considered closed due to US military intervention. Two vessels opting to transit using the Western-backed southern route near Oman, rather than Iran’s designated path to the north of the strait, had been struck, the IRGC added.

Iran said it had also attacked US interests across the region, including in Bahrain, Kuwait, Jordan, Qatar and Oman, in response to US strikes, as prospects for negotiations to replace military escalation remained slim.

Another Tehran citizen, Nastaran, said the overnight escalation felt more serious than previous attacks.

“I didn’t expect it would be this bad when I picked up my phone this morning to check the news,” she said. “I think there will be more attacks soon.”

Growing US aggression

The US military has been expanding its attacks over the past week.

US Central Command said more than 300 military targets were hit during three waves, including coastal surveillance, logistics, communications, as well as missile, drone and naval assets. It has not acknowledged striking civilian objectives.

As with other flare-ups over recent weeks, numerous attacks were launched on the province of Hormozgan, including the major port city of Bandar Abbas, as well as on Siri, Qeshm and Jask overlooking the strait. Port, fishing, coastal-control infrastructure and air defences were extensively bombed, reportedly killing a soldier and leaving multiple fishermen dead or wounded in separate strikes.

US projectiles have also targeted multiple areas in Bushehr province, with one attack impacting the perimeter of Iran’s only nuclear power plant without damaging it.

Provincial authorities in the southwestern province of Khuzestan said three areas were hit, but not the capital, Ahvaz. Local authorities in the provinces of Kohgiluyeh, Boyer-Ahmad and Lorestan also reported projectile attacks.

In Sistan and Baluchestan to the southeast, attacks were reported in Chabahar, Konarak and Iranshahr, where a strike on airport facilities killed a firefighter. Video recorded by a local from Chabahar and shared online showed the destruction of the city’s renowned maritime control tower.

Over the past week, the US military has launched some of its deepest strikes into Iranian territory since full-scale military operations were suspended by the “ceasefire” agreed in April.

One of them was in the northern province of Golestan, where the Aq Tekeh Khan railway bridge was struck on the Gorgan-Incheh Borun line.

Authorities said the bridge, which carries both passengers and cargo, was repaired and services resumed quickly. However, the attack showed that inland corridors could also become targets to increase pressure on Iran by limiting its trade, including imports of essential goods.

The transit route connects Iran to Turkmenistan and onwards to Kazakhstan, Russia, China as well as Eurasian rail networks. Crucially, during the US naval blockade of Iran’s southern ports, it provided an overland alternative to the Strait of Hormuz.

Last week, when assassinated Supreme Leader Ayatollah Ali Khamenei was being buried in his hometown of Mashhad in northeastern Iran, authorities said the US struck a bridge about 55km (34 miles) from the city, disrupting passenger journeys to the funeral procession.

Iranian authorities say electricity infrastructure – which Trump has repeatedly threatened with more strikes – has also been significantly impacted since the start of the war, worsening the long-running energy crisis.

The attacks have reduced Iran’s capacity for electricity generation by about 4,200 megawatts, just as summer temperatures reached 40 degrees Celsius (104 Fahrenheit) this week, Mohammad Allahdad, head of Tavanir, the government-owned parent company for the operation of Iran’s power grid, said on Sunday.

After the conclusion of the funeral ceremonies for Ali Khamenei, a statement from new Supreme Leader Mojtaba Khamenei, who has not been seen public since succeeding his father, emphasised the necessity for revenge.

Similar messages continue to be broadcast by state media and hardline religion-backed factions supporting the Islamic Republic, who on Sunday also cheered the death of US Republican Senator Lindsey Graham. State television hailed what it called the “dispatching to hell” of a pro-war hawkish politician.

For its part, Israel has effectively undermined the MoU signed between Iran and the US on June 17 by pushing deeper into southern Lebanon and signalling readiness to return to military strikes in Iran.

Speaking to an Israeli programme on Saturday night, Defence Minister Israel Katz, who has threatened to assassinate Mojtaba Khamenei, said “southern Lebanon would become Gaza” and that the Israeli army will “apply the Rafah model” of conquest there.

Iran has mounted attacks on Gulf states and declared the Strait of Hormuz closed after the United States conducted its third round of strikes in a week, in a serious escalation as the ongoing conflict spirals.

Tehran on Sunday claimed attacks on Bahrain, Kuwait, Jordan, Qatar and Oman, calling them its response to renewed US bombings on cities along its southern coast.

The widescale US strikes came after Iran shut the Strait of Hormuz — a critical waterway and one of the biggest flashpoints in the conflict — accusing Washington of violating a memorandum of understanding (MoU) signed between the two sides last month.

So, where is the conflict headed? Here is everything we know.

Why has Iran attacked Gulf states and closed Hormuz?

Iran launched missile and drone attacks targeting US military bases and facilities in several Gulf states, while the US Central Command (CENTCOM) carried out a third round of strikes targeting radar, missile, and drone sites across southern Iran last week.

The US attacks came after Iran opened fire on commercial vessels in the Strait of Hormuz and announced the closure of the strategic waterway until further notice, with one crew member missing, according to CENTCOM.

Iran’s powerful parliament speaker and key peace negotiator, Mohammad Bagher Ghalibaf, said on Sunday, “The era of one-sided deals is over.”

“We told you: keep your word or pay the price. Reality is knocking,” Ghalibaf posted on X with an image of Article 5 of the MoU, which relates to the reopening of the Strait of Hormuz.

On Wednesday, US President Donald Trump announced that the ceasefire with Iran was over. His statement was followed by Iran’s Supreme Leader Mojtaba Khamenei pledging to avenge his father’s killing.

How did we reach here?

The fragile MoU reached between the US and Iran had several glaring gaps, keeping the door to escalation ajar.

The tensions spilled over into the Strait of Hormuz again last Monday, when Iran’s Islamic Revolutionary Guard Corps (IRGC) struck three commercial vessels, including a Qatari liquefied natural gas (LNG) tanker off the coast of Oman.

The next day, the US carried out strikes on Iranian military targets, and Tehran responded with missile and drone attacks on US bases across the Gulf, prompting Trump to call off the ceasefire.

The tit-for-tat attacks continued. On Saturday night, the IRGC announced the closure of the Strait of Hormuz until further notice after attacking a container ship using what it called an unapproved route. On Sunday, a second vessel on the strait was hit.

Where did the latest US strikes hit?

CENTCOM said its third round of strikes on Iran last week was “holding Iranian forces accountable” for their recent attack on a Cyprus-flagged ship in the Strait of Hormuz.

It said it hit about 140 military targets that “included Iranian missile and drone sites, naval capabilities, ammunition storage facilities, communication networks, and coastal surveillance locations”.

It added that more than 300 targets were struck over the course of three nights throughout the week “to degrade Iran’s ability to attack civilian mariners and commercial vessels freely transiting the strait”.

Iran’s state broadcaster IRIB said the US launched air attacks on the outskirts of the city of Veysian, in the western Lorestan province, while another strike hit a military base in Iran’s Khondab.

Officials from Bushehr, on Iran’s southern coast, told local media that US forces attacked five cities in the province, including Asaluyeh, Dir, Bushehr, Dashti and Tangestan.

Tehran has said the loss of lives and the extent of damage are under review.

Where did Iran hit back overnight?

Since the start of the ongoing conflict in late February, Tehran has accused the Gulf Cooperation Council (GCC) countries of actively supporting US military operations by hosting its bases and allowing it to use their airspace.

Oman

The IRGC claimed a “heavy and surprise” attack on logistics support centres and refuelling platforms used by US aircraft carriers at the port of Duqm in Oman, according to IRIB.

The IRGC’s public relations office told IRIB the sites were “destroyed” in the attack.

Qatar

The IRGC said it also targeted Qatar’s Al Udeid airbase with ballistic missiles and claimed to have destroyed a fighter plane maintenance centre, as well as a command-and-control centre at the base.

Qatar’s Ministry of Defence said it intercepted incoming Iranian fire. Three people, including a child, were wounded as a result of falling shrapnel from the interception of Iranian attacks, Qatar’s Ministry of Interior said.

Kuwait

Iran’s army said it used explosive drones to target a Patriot air defence system, an ammunition depot and a radar site belonging to the US military in Kuwait.

Bahrain

In another wave of drone attacks, Tehran targeted a US communications system and radar site in Bahrain.

Jordan

The IRGC said it targeted US military facilities at Prince Hassan airbase in Jordan with several ballistic missiles, and claimed to have destroyed a command-and-control centre at the base, as well as hangars housing MQ-9 drones.

What’s happening in the Strait of Hormuz?

Iran has closed down the strait after firing a warning shot that struck a vessel travelling on an unapproved route, and said on Sunday it had disabled a second vessel.

The strait will remain closed until “the end of US interference in this region”, the IRGC said.

Iranian officials told state media the US military has been trying to create an “illegal route” through the Strait of Hormuz, causing insecurity in the area.

The narrow-yet-vital waterway — touted as the artery of global trade, hosting 20 percent of energy flow — has been at the centre of tensions between the US and Iran since the preliminary deal was signed.

Tehran has consistently insisted that only routes approved by Iran shall be taken up during transit through the strait. It says it is open to managing the strait only with Oman, the other coastal country.

The US and the GCC countries have rejected Iran’s claim on the strait and demanded that navigation be freed of interference or any sort of fees.

On Saturday, Iranian Foreign Minister Abbas Araghchi landed in Oman, where the leaders discussed the shipping and management of the Strait of Hormuz, the Ministry of Foreign Affairs said.

How have Gulf countries reacted?

Some countries had sirens blaring on Sunday afternoon, with governments asking residents to stay indoors.

Oman condemned Iran’s attacks and said it is taking “all necessary measures to deal with the developments to preserve the safety of the country and its residents”.

In Qatar, the Interior Ministry said the country’s security threat level is high and urged everyone to remain in safe places and avoid unnecessary movement.

The Kuwaiti army said its forces were responding to “hostile aerial targets” in the country’s airspace, adding that the sounds of explosions are the result of its defence systems intercepting the attacks.

Bahrain’s Interior Ministry said air raid sirens were activated, urging residents to remain calm.

Explosions heard in the port cities of Bandar Abbas, Sirik, Chabahar, Bandar-e Deyr and Asaluyeh as US bombs Iran for a third time this week.

Regional mediators are stepping up efforts to prevent further escalation between Iran and the US. Qatar held talks in Tehran, while Oman is proposing a plan to manage shipping through the Strait of Hormuz. Al Jazeera’s Resul Serdar explains.

Iranian leaders say they’ll never surrender and US President Donald Trump says the ceasefire between the two sides is ‘over’. Iran and the US are locked in the most serious escalation in almost a month. So is the war back on? Soraya Lennie breaks it down.

United States President Donald Trump declared that the agreement pausing the war with Iran was over this week – and ordered a series of strikes.

He accused Iranian forces of violating the ceasefire by attacking ships in the Strait of Hormuz.

Tehran was quick to respond, targeting US interests in Kuwait, Bahrain and Qatar.

The escalation was the worst since the two sides signed a memorandum of understanding last month.

It was meant to pave the way to more talks and a permanent deal to end the war.

Now regional mediators are working to ease the tension.

But does diplomacy still stand a chance?

Presenter: Per Nyberg

Guests:

Hakimeh Saghaye-Biria – Assistant professor at the University of Tehran

Salman Shaikh – Founder of The Shaikh Group, a peacebuilding organisation

Kirsten Fontenrose – Non-resident senior fellow at the Scowcroft Middle East Security Initiative at the Atlantic Council

The late supreme leader will be buried in his hometown, the eastern holy city of Mashhad.

Huge crowds have gathered in the eastern holy city of Mashhad as Iran prepares to bury its slain Supreme Leader Ayatollah Ali Khamenei.

The burial in Khamenei’s hometown on Thursday follows a week of mass funeral processions, rallies and mourning ceremonies held across Iran, including a day dedicated to neighbouring Iraq.

There were marathon ceremonies to project strength and unity amid the US-Israel war on Iran, which began with strikes by the two countries on Tehran that killed Khamenei and several of his relatives on February 28.

Despite a promised pause in US attacks, Khamenei’s burial ceremony comes after the US and Iran traded attacks for a second day.

After massive processions in Iraq’s holy cities of Najaf and Karbala, Khamenei’s remains arrived on Thursday at Mashhad international airport, footage shared by the official news agency IRNA showed.

Iraq’s paramilitary group Popular Mobilisation Forces (PMF), or Hashd al-Shaabi, said on Wednesday more than 2.3 million people took part in Khamenei’s funeral procession in Najaf alone.

Khamenei’s remains, along with those of four family members killed alongside him, were also paraded through Tehran and the Shia clerical centre of Qom.

The Tasnim news agency and the broadcaster Press TV reported that millions of mourners attended the funeral procession in Tehran, with Iranian officials describing the event as the “largest public gathering in the country’s modern history”.

Crowds marched through Mashhad on Thursday morning, waving Iranian flags, photographs of Khamenei and placards with revolutionary slogans.

The mourners also chanted slogans demanding vengeance against US President Donald Trump for his role in the assassination.

“I swear by the blood of the supreme leader, Trump, we will kill you,” they shouted, with women holding up placards reading “Kill Trump”.

The incumbent supreme leader, Mojtaba Khamenei, has been notably absent from the processions. He has not yet appeared in public since taking over days after his father’s assassination.

Officials have said he was wounded in the air strikes that killed his father, but the severity of his injuries remains unclear.

Iranian state television reported that Khamenei’s burial ceremony in Mashhad would be pushed to 2:30pm local time (11:00 GMT) as larger-than-expected crowds had delayed the funeral processions in Iraq.

Reporting from Tehran, Al Jazeera’s Resul Serdar Atas said Iranian officials had confirmed that the overnight US attacks on the Tehran-Mashhad railway line, which have put it out of service, had not delayed the burial ceremony.

Mohammad Mohammadi Golpayegani, head of the late leader’s office, said Khamenei had requested to be buried in Mashhad, near the shrine of Imam Reza, a descendant of the Prophet Muhammad.

The US military says it has struck 90 targets across Iran, hitting ports and infrastructure along the Strait of Hormuz. Iran says at least 14 people have been killed in two nights of attacks, and that it has responded with drone strikes on US-linked sites in the Gulf region.

On Tuesday, two tankers were attacked as they transited the Strait of Hormuz via a passage in Omani waters. Gulf countries responded by sharply condemning the attacks and blaming Iran. The United States then launched attacks on Iranian territory, to which Tehran responded by striking Bahrain and Kuwait. US President Donald Trump has now said the memorandum of understanding (MoU) that Iran and the US signed is void.

This latest escalation illustrates how the Strait of Hormuz has become the central issue in the US-Israel war with Iran that began on February 28. Disagreements over the strait’s future have proven to be the hardest to resolve in the US-Iranian negotiations, as questions about Iran’s nuclear programme have been put to the side.

The disruption of traffic in the Strait of Hormuz has an immediate and costly price tag attached, for Iran, for its Gulf neighbours, and for a global economy that has spent four and a half months absorbing the largest oil supply shock in the history of the modern market.

Iran’s leverage is also its liability

For Tehran, the strait is its strongest card – one that is also incredibly costly. Since the war began, Iranian forces have mined the strait, attacked vessels and cut traffic through the passage by roughly 95 percent. This has led to what the International Energy Agency’s Fatih Birol has called “the largest supply disruption in the history of the global oil market”.

That leverage is real: about a fifth of the world’s oil and a fifth of its liquefied natural gas (LNG) normally move through Hormuz, and no amount of Gulf pipeline capacity can fully replace it.

But Iran has effectively been strangling its own lifeline along with everyone else’s. Iranian crude, once sold for $3 a barrel less than international benchmarks, is now selling at a 20 percent discount. The country’s oil exports collapsed by more than 90 percent in May as US naval enforcement squeezed its shadow fleet.

Even before the war, the World Bank projected that Iran’s economy would contract in 2026. The impact of the collapse of oil sales will be far-reaching because of the closure.

A 60-day US Treasury waiver issued on June 22, permitting Iran to sell oil at full market rates through August 21, but has now been renounced following the attacks on Tuesday.

This is the economic backdrop to Iran’s insistence on asserting joint authority over the strait and floating a system of transit fees or “service charges” for passing ships. Washington has made clear that Iran cannot charge tolls in international waters governed by the right of transit passage under the Law of the Sea.

For Tehran, the dispute is not really about toll revenue, which would be rather modest when compared to its oil income; it is about establishing precedent and sovereignty over a chokepoint that is its only real point of leverage once sanctions relief and frozen-asset release are negotiated.

The latter is itself contested: Iran wants half of an estimated $25bn in frozen assets released immediately, while the US has resisted. A separate $300bn reconstruction fund floated in the MoU has already become a political flashpoint in Washington.

The Gulf is paying for a crisis it didn’t start

For the Gulf states, the Strait of Hormuz crisis has meant improvising around geography. Saudi Arabia has redirected crude through its roughly 1,200km (746-mile) East-West pipeline to the Red Sea port of Yanbu, and the UAE has leaned on the Habshan-to-Fujairah line to the Gulf of Oman.

Together, though, these pipelines carry a fraction of what Hormuz once did, at best 7 million barrels a day of design capacity for the Saudi line and under 1.8 million for the Emirati one, against roughly 20 million barrels a day that transited the strait before the war.

Both alternatives have themselves come under attack: Iranian strikes cut the East-West pipeline’s throughput by an estimated 700,000 barrels a day in April, and drone attacks disrupted loading at Fujairah. Seaborne crude exports from Gulf states excluding Iran fell by roughly half between February and March.

Qatar, host to the talks between Iran and the US, has its own acute stake: its entire LNG export industry depends on the Strait of Hormuz, and it has been pushing the hardest for a settlement.

Oman, drawn into Iran’s sovereignty claim as co-owner of the strait’s territorial waters, is caught between commercial interest in a resolution and a legal position, as a signatory to the United Nations Convention on the Law of the Sea (UNCLOS) that publicly rejects Iranian tolls. Iraq, highly dependent on its Gulf terminals, has quietly explored an export route north through Turkiye.

None of these workarounds are cheap, and all of them are political as well as commercial, tying Gulf capitals’ economic fortunes to a settlement between the US and Iran.

The rest of the world: Insurance bills and inflation

Beyond the region, the crisis has been transmitted mainly through two channels: price and insurance. Higher oil prices are passed on to various consumer goods down supply chains and suppress growth. According to estimates, the global economy can slow down to 2.8 percent in 2026 from 3.4 percent last year due to the closure of the strait.

Insurance for Hormuz transit, which cost roughly 0.25 percent of a vessel’s value before the war, has spiked as high as 8 percent, turning a single large tanker’s coverage into a $3m-to-$8m expense. Shipping lines including CMA CGM and Hapag-Lloyd have layered on conflict surcharges of $1,500 to $2,000 per twenty-foot equivalent unit (TEU). Washington’s own International Development Finance Corporation has had to step in as, in effect, an insurer of last resort, offering up to $40bn in reinsurance capacity to keep vessels moving.

China has absorbed the largest share of this pain: It takes close to 40 percent of its crude imports through the Strait of Hormuz and buys more than 80 percent of Iran’s oil exports outright, making it simultaneously Tehran’s most important customer and one of the war’s most exposed bystanders. Japan, which sources 70 percent of its Middle Eastern crude via the strait, has already tapped strategic reserves.

For import-dependent economies across Asia and Europe, the strait’s fate is not an abstraction of Middle East diplomacy; it shows up directly in fuel, freight and fertiliser prices.

Oil and gas dominate the headlines, but roughly 30 percent of the world’s seaborne fertiliser trade also passes through Hormuz.

The World Bank’s fertiliser price index has risen more than 12 percent in the first quarter of 2026 and has since climbed to its highest level since October 2022, driven largely by the closure. The Food and Agriculture Organization has warned that the resulting scarcity of urea and other nitrogen products will show up as lower yields through the 2026–2027 growing season, hitting import-dependent and already food-insecure countries in Africa and Asia the hardest.

Unlike an oil-price spike, which mainly stings at the pump, a fertiliser shortfall reaches into next year’s harvest, meaning an unresolved Hormuz standoff carries a slower-moving but longer tail of economic damage than crude prices alone suggest.

That is the arithmetic weighing on both sides. A deal that reopens the Strait of Hormuz without resolving who controls it risks recreating the same instability that shut it in the first place; one that concedes Iranian toll authority risks a precedent Washington and shipping nations will not accept. Until that circle is squared, the global economy is left pricing in a chokepoint that neither side can fully afford to keep closed, nor fully agree how to reopen.

The views expressed in this article are the author’s own and do not necessarily reflect Al Jazeera’s editorial policy.

US President Donald Trump says the US will ‘probably’ carry out another round of strikes on Iran on Wednesday night, following overnight strikes he said were launched in response to Iranian attacks on ships in the Strait of Hormuz.

Tehran, Iran – Three weeks after Iran and the United States signed a memorandum of understanding to extend their ceasefire, their truce remains fragile.

Three tankers have been hit in the Strait of Hormuz over the past two days, even as Iran and the US are expected to restart mediated negotiations to end the war next week, after the funeral of Iran’s Supreme Leader Ayatollah Ali Khamenei.

The US military on Wednesday launched large air attacks on Iran’s southern provinces, which prompted the Islamic Revolutionary Guard Corps (IRGC) and Iran’s regular army to fire missiles and drones on US interests in Bahrain and Kuwait. Both sides accused each other of violating the understanding signed last month.

But even if a long-term resolution is eventually reached and Western sanctions on Iran are lifted, analysts say that it will take time for the country’s economy to recover.

The economy has been strained by years of local mismanagement and corruption; stringent Western and United Nations sanctions; and, more recently, damage sustained from two wars in a year with the US and Israel, deadly nationwide protests in January, and internet shutdowns.

When numbers tell a story

A falling purchasing power has pushed millions into poverty. Inflation has recently climbed to levels not seen since World War II, when Allied forces occupied Iran, took over railways and food supplies, and contributed to a deadly famine.

The latest report by the Statistical Center of Iran for Khordad, the third month of the Persian calendar that ended on June 21, showed inflation increasing by 88.6 percent compared to the same month of the year before. Inflation was up by nearly 6 percent compared to the second month of the current year.

Food inflation was skyrocketing at almost 134 percent in Khordad compared to the corresponding month a year earlier, with oils and fats surging by more than 278 percent, red meat and poultry by over 178 percent, and bread and cereals by nearly 139 percent.

Unemployment is at 7.5 percent during the current calendar year, according to the latest report by the statistical centre released at the end of June. But labour participation is at just 40 percent, meaning that most working-age people are operating outside the official labour force – including students, retirees, those engaged in irregular informal work, and those not seeking paid work.

The job-quality picture is also grim, as salaries are perennially falling behind expenses, as over 38 percent of officially employed people work more than 49 hours a week, and as youth unemployment is at over 20 percent, the centre reports.

The base monthly minimum wage equals only about $95 using the current open market exchange rate of the US dollar in Tehran. The rate has climbed to 1.75 million rials per greenback over recent days, not far from its all-time low of 1.9 million in May.

The damage — and the road to recovery

Due to a heavy budget crunch, the only relief the government is able to offer amounts to a few dollars’ worth of monthly cash subsidy and electronic coupons for purchasing essential goods.

A late June report by the Central Bank of Iran for the previous calendar year that ended on March 20 showed that gross domestic product (GDP) growth for the year stood at minus 0.7 percent, and gross fixed capital formation, a primary indicator of productive capacity and economic growth, was at nearly minus 12 percent. Imports were down 16.6 percent, as were exports by close to 5 percent.

The damage from nearly 40 days of heavy bombardment during the war, the longest nationwide state-imposed internet shutdown in any country, and a US naval blockade of Iran’s southern ports — the full extent of which remains undisclosed to the public — has only exacerbated Iran’s economic woes. The International Monetary Fund has projected that Iran’s real GDP will shrink by 6.1 percent in 2026.

Still, Mahdi Ghodsi, a senior economist at the Vienna Institute for International Economic Studies, said that part of the recent job losses could be recoverable if there is a credible halt to military escalation, restoration of transport and logistics links, more predictable access to energy and fuel, and functioning internet and payment systems.

“In that case, some temporary layoffs in services, retail, transport, construction and small businesses could be reversed relatively quickly, because these activities are highly sensitive to uncertainty and disruptions rather than necessarily destroyed productive capacity,” he told Al Jazeera.

Longer-term challenges

But Ghodsi cautioned that part of the damage is likely to be more persistent.

“Where factories have lost machinery, inventories, imported inputs, workers, working capital, or access to energy, reopening is not simply a matter of returning to normal,” he said, adding that in some cases, full recovery may take years and require large investments, including foreign financing.

Last week, leading satellite imaging provider Planet Labs restored access to imagery for nearly 800 sites across Iran impacted during the war, after lifting earlier restrictions it had placed in response to a US government request to delay or suspend access.

Some Iranians on social media highlighted massive damage done to Iran Electronics Industries (SAIran), a state-owned defence industry heavyweight specialising in optics, communications, semiconductors and medical equipment, among other things.

But along with numerous military-linked sites and assets, and nuclear facilities built over decades now reduced to rubble, Iran’s industrial capacity and civilian infrastructure were also extensively targeted by US and Israeli warplanes and vessels during the war.

Oil and gas facilities, petrochemical and steel giants, electricity outposts, as well as maritime ports, airports, roads, bridges and residential units were significantly damaged.

Work on rebuilding facilities and recovering lost capacities has begun during the period of reduced military hostility over recent weeks, with some airports and industrial units restarting operations.

But a full recovery still appears distant and more destruction could still lay ahead. US President Donald Trump has repeatedly threatened extensive attacks against Iran’s electricity grid and infrastructure like bridges if the war resumes.

Economist Ghodsi said the government’s limited fiscal capacity remains one of the central problems, since the state has already faced struggles in financing not only regular expenditures and salaries, but also obligations across public and semi-public sectors. “This fiscal weakness has been one of the drivers of inflation, as budgetary pressures are partly shifted onto the banking system and the central bank through monetary financing,” he said.

Domestic fissures

Speaking at a state-organised event in Tehran last month, Iran’s President Masoud Pezeshkian expressed concerns about another nationwide protest as public discontent remains high.

“Our most important strength is our unity, and the unity of our people. What I fear is that we fail to serve the people right and they are dissatisfied and come to the streets to protest. Then our might collapses,” he said.

Senior officials spearheading the mediated talks with Washington have backed the process as the viable path to delivering a better economy to the suffering Iranian population.

But hardliners within the system, who perceive Iran to have attained a major victory against superior military powers during the war, continue to vociferously reject giving any concessions.

During Khamenei’s funeral procession in Tehran on Monday, Pezeshkian was filmed getting heckled by anti-deal mourners who demanded blood vengeance for the slain supreme leader and shouted “Death to the compromiser” and “Death to the traitorous homeland-seller”.