New attacks hit three commercial ships in the Gulf on Wednesday, with one of the vessels in flames as Iran pressed its campaign against its oil-exporting neighbours, threatening shipping in the Strait of Hormuz and plunging the global energy economy into crisis.
Oil prices surged higher by more that five percent in early trading and markets have see-sawed since the end of last month, when the United States and Israel attacked Iran, killed its supreme leader and plunged the Middle East into war.
As the conflict entered its 12th day, the Iranian military vowed to target "economic centres and banks" linked to US and Israeli interests, and all eyes were on the vital sea lane.
The leaders of the G7 powers were to hold a video meeting later to discuss opening their strategic petroleum reserves to counter rising prices. Ahead of the talks, the group's energy ministers said they "stand ready to take all necessary measures" in coordination with the International Energy Agency (IEA).
Japan is ready to take the lead and release its oil reserves as early as Monday, without waiting for an IEA decision, Prime Minister Sanae Takaichi said.
On Tuesday, the Pentagon said US forces had carried out strikes that destroyed 16 mine-laying vessels that could have been used to block the strait, but attacks with drones or missiles continued on Wednesday with at least three ships hit.
"If for any reason mines were placed, and they are not removed forthwith, the military consequences to Iran will be at a level never seen before," US President Donald Trump posted on social media.
Turkey's President Recep Tayyip Erdogan called on the warring parties to negotiate a ceasefire, an idea already rejected by senior Iranian leaders, while Israel said it had begun a new "wide-scale wave of strikes" across Iran and against Hezbollah targets in Lebanon's capital Beirut.
"This war must be stopped before it becomes bigger and completely engulfs the region in flames," Erdogan said, describing the Middle East as "once again enveloped in a smell of blood and gunpowder".
According to the UK maritime security centre the crew of a cargo vessel in the Strait of Hormuz north of Oman was forced to evacuate when an "unidentified projectile" caused a fire on board.
Separately a bulk carrier and a container ship were hit in the Gulf off the United Arab Emirates.
The Thai navy said the bulk carrier Mayuree Naree "was attacked while transiting the Strait of Hormuz".
Trump has said the US Navy could accompany tankers through the strait, but experts were dubious about whether naval escorts would be enough to reopen Hormuz to trade.
"Any escort mission would likely face persistent threats from Iranian missiles and drones, and the security risks alone could make a single transit through the strait more costly than the profit margin on the oil shipment itself," the Soufan Center think tank said, in a briefing note.
Ayatollah 'safe and sound'
The United States and Israel launched the war on February 28 with an attack that killed Iran's veteran leader, Ayatollah Ali Khamenei.
His son Mojtaba Khamenei has been named his successor, though he has yet to appear in public, amid reports that he has been wounded.
"I heard news that Mr Mojtaba Khamenei had been injured. I have asked some friends who had connections. They told me that, thank God, he is safe and sound," said Yousef Pezeshkian, son of Iran's president, in a post.
Iran's health ministry said on March 8 that more than 1,200 people had been killed in US and Israeli strikes, and more than 10,000 civilians injured. AFP was not in a position to independently verify the figures.
Iraq and Lebanon, both home to Iran-backed fighters, have become proxy grounds in the war.
In Lebanon, authorities reported 570 people killed and hundreds of thousands of displaced following Israeli air strikes and ground operations targeting Iran-backed Hezbollah.
New Israeli strikes were reported in Beirut's southern suburbs on Wednesday, while an attack also hit a building in the heart of the capital.
Iran's military vowed on Wednesday to launch strikes against US and Israeli economic targets in the region, including banks, after overnight attacks hit an Iranian bank.
"The enemy has given us free rein to target economic centres and banks belonging to the United States and the Zionist regime," said the military's central operational command, Khatam Al-Anbiya, in a statement carried by state TV.
Iranian media said US and Israeli strikes hit a bank in Tehran overnight, killing an unspecified number of employees.
Drones fall near Dubai airport, two ships hit
Drones fell near Dubai airport, injuring four people, while ships were hit in or near the Strait of Hormuz on Wednesday as Iran kept up its campaign disrupting oil markets and air and maritime traffic.
The oil-rich Gulf has borne the brunt of Iran's attacks in response to US-Israeli strikes that sparked the Middle East war, with Tehran targeting US assets but also civilian infrastructure.
Iran has also targeted Gulf energy infrastructure and choked shipping in the Strait of Hormuz, which normally carries nearly 20 percent of global oil production, prompting wild swings in prices.
A container ship and a bulk carrier were hit off the coast of the UAE, one off Dubai and the other off the northern Emriate of Ras Al Khaimah by unknown projectiles, according to the United Kingdom Maritime Trade Operations (UKMTO).
A third ship was also hit by a projectile off Oman, in the Strait of Hormuz, which caused a fire that was later extinguished according to the UKMTO.
Iran starts laying mines in Strait of Hormuz as war hots up
A day after Iran’s Revolutionary Guards Corps (IRGC) threatened not to let pass ‘a litre of oil’ from the Strait of Hormuz, the Iranian forces have started to lay mines in the sea to halt the oil exports along with unleashing early Wednesday defiant new strikes around the region.
The United States has launched an all-out assault on Iranian minelaying vessels, as President Donald Trump warned Tehran of unprecedented military consequences if it targets the Strait of Hormuz.
Trump's comments came after Tehran vowed that no Gulf oil would pass through the key waterway, with oil prices remaining highly volatile over the virtual halt of shipping in the strait.
"I am pleased to report that within the last few hours, we have hit, and completely destroyed, 10 inactive minelaying boats and/or ships, with more to follow!" Trump said on his Truth Social platform.
Later, United States Central Command (CENTCOM) wrote on X that the figure had risen to 16 destroyed minelayers "near the Strait of Hormuz."
CENTCOM's post included unclassified video footage showing various boats being struck by missiles or other projectiles and exploding.
After several US media outlets said Iran had either started or was on the verge of mining the Strait of Hormuz, Trump said he had no reports that such action had begun. But Trump warned: "If for any reason mines were placed, and they are not removed forthwith, the military consequences to Iran will be at a level never seen before.
"If, on the other hand, they remove what may have been placed, it will be a giant step in the right direction!"
The United States would also use the missiles it had previously employed to blow up alleged drug-trafficking vessels in Latin American waters to "permanently eliminate" any mine-laying boat in the Gulf strait, Trump added. "They will be dealt with quickly and violently."
Nearly a fifth of global oil production passes through the Strait of Hormuz.
The White House said earlier Tuesday that the United States has not escorted any oil tanker through the waterway, after the energy secretary's social media account posted but then deleted a claim that it did so.
Trump's administration has listed eliminating Iran's navy as a key military objective of "Operation Epic Fury," the joint US-Israeli offensive launched against Iran on February 28.
On Monday Trump told Republican lawmakers Iran's navy has been decimated by US attacks, with at least 46 ships destroyed, including several "top-of-the-line" vessels.
"The navy is gone. It's all lying at the bottom of the ocean," he said.
New wave of Iran attacks
Iran unleashed early Wednesday defiant new strikes around the region including drones targeting a Saudi oilfield, as the International Energy Agency reportedly proposed its largest-ever oil reserve release to calm markets and prices.
The war sparked by US-Israeli strikes on Iran has spread across the region and caused spiking energy costs, forcing fuel rationing, price hikes and even school closures globally.
G7 leaders will meet by video conference later Wednesday to discuss the war's economic consequences, particularly the "energy situation," the French presidency said, with the IEA also due to decide on a proposal for its largest-ever oil reserve release, the Wall Street Journal reported.
Israel also launched new waves of strikes both in Beirut and Tehran, where residents hunkered down after being smothered by black rain from Israeli bombing of fuel depots.
Trump faces mounting political risks over the surging cost of oil, months before US elections. Crude prices spiked five percent late Tuesday, though it turned lower Wednesday after the reserve release report.
- 'Not seeking ceasefire' -
Iran's government defiantly said that it carried out its own "most intense and heaviest" salvo early Wednesday firing missiles for three hours at cities across Israel.
AFP journalists heard air raid sirens and explosions in Jerusalem. Emergency services reported no immediate injuries, although Channel 12 said several people were hurt in Tel Aviv. And new salvos were reported early on Wednesday, with no reports of injuries.
Iran's Revolutionary Guards said they also fired on Bahrain and Iraqi Kurdistan, both of which have a heavy US presence.
Drone and ballistic missiles were intercepted across the Gulf on Wednesday morning, including seven drones heading to an oil field in Saudi Arabia, its defence ministry said.
Earlier, Iranian parliament speaker Mohammad Bagher Ghalibaf, a former top commander in the elite Revolutionary Guards, said in an English-language post on X: "Certainly we aren't seeking a ceasefire."
"We believe the aggressor must be punished and taught a lesson that will deter them from attacking Iran again," he added.
Seven US military personnel have been killed and about 140 injured since the start of the war, according to the Pentagon.
- War effects spreading -
Iraq and Lebanon, both home to Shia fighters tied to Iran, have become proxy grounds of the war, with devastating consequences.
In Iraq, Iranian-linked groups said five of their fighters died in what they suspected to be strikes by the United States.
Demonstrators had sought to storm the US embassy in Baghdad and at least five drones landed Tuesday at a military base at the Baghdad International Airport, home to a US diplomatic facility.
In Lebanon, authorities said that Israeli attacks killed at least 486 people and injured more than 1,300 others between March 2 and Monday, with new strikes targeting Beirut's southern suburbs early Wednesday.
Iran complained to the United Nations to say that four of its diplomats died in a strike on a seafront hotel in central Beirut on Sunday that Israel said had been aimed at "key commanders" from Iran's Revolutionary Guards.
The effects of the war are being felt globally, with the UN trade and development agency warning of rising costs for essentials like fuel and food hitting the world's most vulnerable people.
In Egypt, which increased the cost of fuels by up to 30 percent, mother-of-six Om Mohamed fretted about the future. "We were barely getting by as it is. I don't know how people will manage," she told AFP at a Cairo market.
Iran targets US base in Kuwait
Iran's Revolutionary Guards said Wednesday that at least two missiles targeted a United States base in Kuwait, according to Iranian news agencies Fars and Mehr.
"The American base in Arifjan was... hit by firing 2 missiles by the IRGC Ground Force missile unit," the Guards said, Fars and Mehr reported, referring to Camp Arifjan located south of Kuwait City.
Kuwaiti authorities have not yet commented on the reports.
Container ship hit off UAE
A container ship was hit off the coast of the United Arab Emirates by an unidentified projectile, a British maritime security agency reported on Wednesday, as Iran retaliates across the Gulf in response to US-Israeli strikes.
"The Master of a container vessel has reported that the vessel has sustained damage from a suspected but unknown projectile," the United Kingdom Maritime Trade Operations (UKMTO) said, adding the extent of the damage was unknown but all crew members were safe.
The incident took place 25 nautical miles (29 miles) northwest of the emirate of Ras Al Khaimah, the agency said.
It called on vessels to transit the region "with caution" while authorities investigate the incident.
Iran's elite Revolutionary Guards have said they had "complete control" of the Strait of Hormuz, a crucial chokepoint into the Gulf and one of the world's most vital shipping routes for energy.
The crucial waterway -- less than 30 miles (48 kilometers) across at its narrowest point -- is shared by Iran on one side and Oman on the other.
At least 10 oil tankers in or near the strait were struck, targeted, or reported attacks between March 1 and 10, according to data compiled by the UK Maritime Trade Organisation, the International Maritime Organization, and Iranian authorities.
US President Donald Trump warned Iran on Tuesday of unprecedented military consequences if it mines the Strait of Hormuz, after Tehran vowed that no Gulf oil would pass through the key waterway.
The White House said earlier Tuesday that the United States has not escorted any oil tanker through the Strait of Hormuz, after the energy secretary's social media account posted but then deleted a claim that it did so.
Iran protesters to be treated as 'enemies'
Iran's top police officer warned protesters who support the positions of the country's enemies that they would be treated as such by authorities, according to footage posted by state broadcaster IRIB late on Tuesday.
"If anyone comes forward in line with the wishes of the enemy, we will no longer see them as merely a protester, we will see them as an enemy. And we will do to them what we do to an enemy. We will deal with them in the same way we deal with enemies," said national police chief Ahmad-Reza Radan in comments aired by IRIB.
"All our forces are also ready, with their hands on the trigger, prepared to defend their revolution."
Saudi Arabia intercepts seven drones
Saudi Arabia's defence ministry said on Wednesday that it intercepted seven drones heading towards an oil field in the southeast of the country.
"Two drones heading towards the Shaybah oil field were intercepted and destroyed," the ministry said in a post on X.
Another five drones were intercepted and destroyed, the ministry said in separate posts.
The oil field sits near the border with the United Arab Emirates and is operated by Saudi giant Aramco, one of the world's biggest companies by market capitalisation.
The field is crucial to the kingdom's vast oil production.
- 140 US wounded -
The Pentagon said that about 140 US military personnel have been wounded in attacks in the Iran war.
The figure comes on top of the death of seven US service members early in the conflict already given by the US military.
- Hacked cameras -
Israel's cybersecurity directorate said it had identified "dozens of Iranian breaches into security cameras for espionage purposes" since the start of the war and urged the public to update their passwords and software.
- Iran arrests alleged spies -
Iran's intelligence ministry announced the arrests of 30 people accused of spying "on behalf of two Persian Gulf countries in the name of the American-Zionist enemy".
Those arrested included one foreigner, whose nationality was not revealed.
- Major refinery shut -
One of the world's biggest oil refineries, the Ruwais facility in the United Arab Emirates, halted operations as a "precaution" following a drone attack on the industrial complex housing it, a source told AFP.–Agencies