Iran Warns of Fiercer War as Brent Tops $101

A senior official of the Islamic Republic has said publicly, for the first time, that Tehran has no intention of backing down in the face of the US naval blockade and will intensify its strikes if the United States keeps hitting Iranian territory. The statement comes a day after reports of the sinking of five Iranian tankers and a missile attack on a US base in Jordan, and it is being felt directly on the global oil market, whose movements, through fuel prices and import bills, reach countries like Serbia that import most of their energy.

In brief:

• Brent crude closed above $100 on Wednesday for the first time since July, and on Thursday it is holding near $101 a barrel
• The US military sank five Iranian tankers, and Iran retaliated with missiles on a base in Jordan and attacks on two destroyers
• The Revolutionary Guard claims it seized a US unmanned submarine, the Pentagon says it malfunctioned
• Trump says the conflict will continue past the November congressional elections

Why Brent Is Breaking Above $100

Brent jumped 3.4 percent on Wednesday and closed in triple digits for the first time since July, and on Thursday it is holding near $101 a barrel. West Texas Intermediate is trading above $96. Brent is up roughly 70 percent since the start of the year, although it remains below the wartime record of $126 a barrel set in April, helped in part by crude that keeps leaving the Gulf despite the blockade.

The Iranian official, who declined to be named because he was discussing sensitive matters, says Tehran has rebuilt its military capacity since April and has enough missiles for a prolonged conflict. He acknowledged that economic pressure is mounting, but said Iran’s leadership believes it has no choice but to keep fighting until it is convinced Washington will no longer dare to attack. Inflation in Iran has accelerated to nearly 90 percent, the rial is losing value fast, and the blockaded country is barely managing to export oil.

Five Tankers Sunk and a Missile Strike on Jordan

US Central Command said its forces destroyed five Iranian oil tankers on Wednesday, four of them, the Kaviz, the Carminar, the Horizon 1 and the Rijesko, in the Gulf of Oman, and a fifth, the Derja, near Kharg Island. The strike followed two attempts by the Revolutionary Guard, according to US accounts, over the previous two days to hit a US warship with ballistic missiles, both of which the ship evaded.

“Iran continues to try to hit US warships, and every time they do it or attempt to do it, they are going to lose tankers.”

US Secretary of State Marco Rubio said in a statement to the press, defending the decision to sink the tankers.

Iran retaliated with 20 ballistic missiles against Al Azraq air base in Jordan, used by US forces. Jordanian air defenses shot down 18 of the missiles, two fell in an unpopulated area, and no injuries were reported. Iranian officials claim they also targeted two US destroyers, the DDG-119 and the DDG-53, that same night, and the Revolutionary Guard said a total of ten ships were attacked or targeted near the Strait of Hormuz, including eight tankers.

“In response to the aggressive actions of the United States against Iranian oil tankers, the armed forces attacked US military bases and facilities in Jordan.”

Iran’s Ministry of Foreign Affairs said in a statement, while the speaker of Iran’s Parliament, Mohammad Bagher Ghalibaf, told lawmakers that “the era of proportional responses is over.”

The Disputed Submarine and Sharper Rhetoric

The Revolutionary Guard said on Tuesday, September 8, on state television, that it had seized a US unmanned submarine at the entrance to the Strait of Hormuz.

“The naval forces of the Revolutionary Guard have seized one of the most advanced, unmanned and smart submarines of the American terrorist military at the entrance to the Strait of Hormuz.”

The Pentagon responded the same day that the unmanned underwater vehicle had simply malfunctioned while monitoring regional waters, and that it was not carrying classified sonar or radar equipment. Mohsen Rezaei, secretary of Iran’s Supreme National Security Council, said on the occasion that “the military posture toward US forces has been fundamentally changed,” signaling a tougher approach by Tehran toward US ships and bases in the region.

Blockade Squeezes Iran’s Economy as Trump Signals a Long War

US Central Command says that, as of September 7, as part of enforcing the blockade of Iranian ports, it had redirected 94 merchant ships, disabled three and boarded two. The goal is to force Tehran economically to reopen the Strait of Hormuz and return to negotiations, while Iran’s leadership continues to insist it has the right to control traffic through the strait and regularly fires on ships passing through it without its permission.

US President Donald Trump said the conflict will continue past the November congressional elections and that there will be no significant drop in fuel prices in America before then. Diesel has hit a record price in the United States, and stockpiles are expected to fall this month to their lowest level in more than twenty years, according to the Energy Information Administration. Iran’s President Masoud Pezeshkian continues to call for negotiations to ease the economic pressure on his own country, but the security leadership in Tehran, judging by the tone of recent days, currently has the upper hand.

There have been no official peace talks between Washington and Tehran for months, and the conflict that began in late February is now entering its seventh month with no sign of a ceasefire. The next signal on whether the war will escalate further or temporarily cool down is expected only once the blockade of the Strait of Hormuz and the sanctions against Iran’s remaining trading partners produce their first concrete effects on Iran’s foreign trade.