Iran War Escalation: New Shipping Attacks Raise Fears Over Strait of Hormuz Crisis

Fresh attacks on commercial shipping have added to growing concerns that the conflict involving Iran could escalate further, as diplomatic efforts to bring the war to an end appear to have reached another deadlock.

The United States and the Iranian-backed Houthis in Yemen claimed to have different attacks on shipping on Tuesday, and Tehran threatened to close the strategically vital Strait of Hormuz unless Washington complied with its demands.

The recent events took place near two key shipping lanes: Bab el-Mandeb at the Red Sea entrance and the Gulf of Oman leading to the Strait of Hormuz at the entrance to the Persian Gulf. The two waterways are vital to international energy and trade.

The renewed uncertainty had an impact on financial markets. Oil prices rose 1.4% to $88.91 a barrel on the Brent crude marker and 1.3% to $83.20 on the U.S. marker. The markets of world capital were also falling, as the investors were becoming less convinced that the conflict would end soon.

Four crew members were reportedly killed by a suspected Houthi attack against the Egyptian-owned cargo ship Tihamah at the southern entry into the Red Sea. The deaths were announced by Yemen’s Transport Ministry on Tuesday, and two rescuers from an anti-Houthi military force were killed, according to the country’s Coast Guard.

The deaths would be the first reported casualties on commercial shipping crews from the Houthis since the Iran war started.

Saba news agency, which is backed by the Houthis, reported that the group had attacked a Saudi ship that was carrying military supplies through the Bab el-Mandeb Strait. The report did not specify the name of the ship, nor had the Saudi authorities commented immediately.

Meanwhile, the US military revealed two Hellfire missiles were fired by an MH-60 helicopter at a cargo ship flagged Panama following a number of warnings to comply with a US naval blockade of Iranian ports. Sources in the maritime sector reported the boat was hit off the coast of Pakistan on its way to the Gulf of Oman.

Iran and US escalate threats to one another.

Tensions have also risen as Tehran has become more belligerent and Washington has responded with more belligerent statements.

Iran won’t reopen the Strait of Hormuz unless the United States agrees to conditions such as the unfreezing of Iranian assets and a halt to regional conflicts, including those in Lebanon and Gaza, said Mohsen Rezaei, a top Iranian security official on Tuesday.

His remarks came after the new demand by the U.S. President, Donald Trump, for Iran to pay reparations to those who died during decades-long wars, attacks and protests.

Trump has said on several occasions that he plans to continue his drone campaign and may also be willing to pursue a diplomatic solution soon. But his latest comments suggested otherwise, as a cloud of uncertainty loomed over the go/no-go decision.

If the situation demanded it, he said Iran’s economy could be let to wither and die or the U.S. could take much more serious military action.

Trump also said that the U.S. essentially holds the key to the Strait of Hormuz and that Iran could be facing “severe consequences” if it makes further attempts.

The new Iranian stance is one of the most explicit statements to date that the waterway, which is so vital to the country’s strategic interests, might remain shut for a long period. Pre-war, a fifth of the world’s oil and liquified natural gas (LNG) was transported through the Strait of Hormuz. Prior to the war, the Strait of Hormuz was responsible for transporting approximately one-fifth of global oil and liquified natural gas (LNG) supplies.

Since US and Israeli attacks on Iran started Feb. 28, the war has already claimed thousands of lives. Iran has since gone on to attack assets and infrastructure associated with the United States in a number of countries including Oman, Jordan, Kuwait, Israel, the United Arab Emirates and Saudi Arabia.

The worry of further escalation flared after Mohammad Reza Naqdi, an adviser to the commander of Iran’s revolutionary guards, said the force was working to carry out operations on what he termed “enemy territory.” The developments have raised further fears about the conflict’s possible influence on global energy supplies and the international trade and regional security.