War returns to Iran with Israel, US strikes

Oil prices are down, set for a second straight weekly decline, as signs of a growing global supply surplus weigh on the market and Washington’s focus on blockading Iran while ramping up other economic pressures allay fears of renewed hostilities in the nine-month war, Reuters reports.

Brent futures are down 5 cents, or 0.05 per cent, to $95.77 a barrel as of 1746 GMT (10:46pm PKT). US West Texas Intermediate futures have fallen 17 cents, or 0.19pc, to $88.57 a barrel.

The International Energy Agency’s (IEA) member countries will release around 71 million barrels of emergency oil and product stocks through the end of February 2027, roughly doubling the pace of the releases in September and October, Reuters reports citing the agency.

Included in the release will be around 15 million barrels of diesel, which are scheduled to be released by the end of February, almost entirely from government stocks in France and Germany, at a pace of 4 million to 5 million barrels in January before easing in February, the IEA says in a monthly report.

The move by the IEA, which manages industrialised countries’ strategic oil inventories for use in severe oil shocks, is part of a record stocks release first announced in March after the Iran war cut supplies from the Middle East, sending prices soaring.

Yemen’s government forces say the Houthis launched a ballistic missile attack on Aden this evening in a “terrorist act targeting civilians”, Al Jazeera reports.

The latest attack threatens the security and safety of residents and represents a dangerous escalation, Majed Abdullah al-Nuzaili, a spokesperson for Yemen’s government forces, said in a statement.

He added that government forces are taking all necessary operational measures to deal firmly with the sources of the threat.

Saudi Arabia’s civil defence has sent out an all-clear notice for the southwestern province of Jizan, minutes after warning earlier of potential danger in the area, Reuters reports.

Jizan is home to a Saudi Aramco refinery with a capacity of 400,000 barrels of crude oil per day.

Saudi Arabia’s Directorate of Civil Defence has issued an early warning for the kingdom’s Jizan province.

US Treasury Secretary Scott Bessent says the Federal Reserve should have an open mind and not hike rates because of an “energy supply shock” tied to the Iran war, Reuters reports.

“I think the Fed should understand that this is an energy supply shock,” while the underlying US economy is very strong, Bessent said in an interview on CNBC.

“So I think that to hike too much into an energy supply shock when it’s coming down, these are very noisy numbers,” he explains. “You know, the Fed’s supposed to look into the future, not look in the rearview mirror.”

The US central bank left its policy rate on hold last month, with Fed Chairman Kevin Warsh saying policymakers would be watching for data to help decide whether more monetary policy tightening would be needed.

“I’m not going to tell the Fed what to do. I am going to say they should have an open mind,” Bessent says, noting that the Fed did three rate cuts over the same period last year. “And now to reverse just based on an energy supply shock, a reversal in a dramatic way isn’t something that I would do if I were on the Fed. But I’m not on the Fed.”

It is necessary to raise pressure on Yemen’s Houthis so that they end their attacks in the region, notably on Saudi Arabia, France’s foreign ministry spokesperson says, according to Reuters.

“Our position is that it is necessary to increase pressure on the Houthis so that they put an end to their unacceptable attacks and provocations, particularly against Saudi territory, but not only there,” Pascal Confavreux tells a news conference in response to a question on whether Paris backs the idea of the European Union designating the Houthis as a terrorist organisation.

In a piece carried by Iran’s IRNA state news agency, Foreign Minister Abbas Araghchi has outlined how the US and Israel’s unilateral strikes on the country are not only illegal, threaten international law as a whole.

“The military attacks launched by the United States and the Zionist regime (Israel) against Iran constitute a clear violation of the prohibition on the use of force and an infringement of Iran’s sovereignty,” he writes, noting that the legality of the strikes must be assessed through the lens of international law, not justifications after the fact.

Citing Article 2(4) of the UN Charter, which prohibits the use or threat of force by member states, Araghchi notes that the US-Israeli strikes were not approved by the Security Council and allegations of future threats do not meet the requirements for Article 51 — the right to self-defence.

“To treat a potential future threat as grounds for military action would be to accept preventive war based on the unilateral judgment of individual states,” he adds. “Such an interpretation would seriously undermine, if not altogether empty, the prohibition on the use of force of its practical meaning.”

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US Treasury Secretary Scott Bessent tells CNBC that he will not be cowed by Iranian threats against his life, after recently moving from his Washington, DC, residence to a US military base, Reuters reports.

“Why am I going to be afraid when the brave military personnel in the Gulf [and] President (Donald) Trump, constantly receive death threats?” he says.

Outside a depot near Basra, hundreds of tanker trucks queue to load Iraqi crude oil bound for the Syrian port of Baniyas via an overland desert route which had been largely unused for decades, Reuters reports.

Iraq, OPEC’s second-largest producer, has been working to find alternative export routes for its oil since the Strait of Hormuz, its usual outlet, was disrupted by the Iran war. Despite higher transportation costs, the overland route has also regained appeal because of an end to years of conflict in Syria, two people close to the matter tell Reuters.

Since last month, Qatari energy group UCC Holding has been shipping Iraqi crude oil by truck to Baniyas, said Bassem Abdul Karim, director general of state-run Basra Oil Company (BOC).

UCC began shipping 120,000 to 150,000 barrels per day (bpd) under a contract with state oil marketer SOMO, with cargo volumes depending on truck availability, Abdul Karim added.

UCC and SOMO have not responded to requests for comment.

US Central Command has denied the Iran’s Revolutionary Guards statement claiming that Iran had targeted a US early-warning radar in Bahrain, saying US forces had shot down two one-way attack drones launched by the IRGC toward Bahrain and that there were no injuries or damage, Reuters reports.

Yemen’s internationally recognised government is fortifying positions on the outskirts of Aden province, home to its de facto capital, as Houthi foes seize hilltops overlooking the area, three military officials tell AFP.

Houthi fighters are advancing east, consolidating their gains near the Red Sea while also moving closer to the Gulf of Aden. They have been taking hold of strategic hilltops in the Al-Madaribah wal Ara district overlooking Aden province, the sources says.

“We received high-level directives to establish military fortifications west and north of Aden Governorate, as the threat to the government’s interim capital draws nearer,” one of the military officials says.

The fortifications include stacking up sandbags and digging tunnels.

The US military has denied an Israeli media report that it is preparing for a possible resumption of operations against Iran, dismissing claims of changes to its regional force posture as “pure speculation”.

Responding to Anadolu, a US Central Command (Centcom) official says there are no updates to the US force posture in the Middle East.

The denial follows a report by the Israeli public broadcaster KAN, which cites a US official as saying that Centcom had urged Israel to prepare for a possible resumption of military operations against Iran in the near future. The warning was reportedly conveyed to Israeli military representatives in the United States.

KAN also reports that Washington is sending similar messages to Gulf countries through security channels.

The report further claims that the US deployed around 200 aerial refuelling aircraft across the Middle East and Europe, with two aircraft carriers — the USS George Washington and USS George HW Bush — already in the region and a third, the USS Roosevelt, expected to arrive in the Arabian Sea next week.

The Iranian military says it has shot down a US MQ-1 drone off the coast of Sirik using a “new naval air defence system”, state broadcaster Press TV reports.

The UN’s nuclear watchdog urged Iran to take “incremental steps” to allow inspectors to return to key nuclear facilities in the Islamic republic, adding such access was “critical” in a report seen by AFP

The International Atomic Energy Agency (IAEA) has not had access to key nuclear facilities in Iran since Israel, joined by the United States, launched a 12-day conflict in June 2025 that included strikes on nuclear sites.

Nuclear facilities have also been hit in the latest war, which erupted on February 28, and the IAEA has repeatedly called for access.

In its report, the agency said that it was “critical” for it to conduct “verification activities in Iran without further delay”.

The world oil market will return to a surplus in the fourth quarter of this year, the International Energy Agency said, as Middle East exports recover faster than global oil demand despite continued attacks on shipping, Reuters reports.

The agency also gave more details of remaining volumes to come from a record release of oil from its members’ emergency reserves pledged in March, saying 71 million barrels would be made available by the end of February including 15 million barrels of diesel to ease market tightness.

Major General Mostafa Izadi, deputy commander of the Islamic Revolutionary Guard Corps (IRGC), has warned that Iranian forces will deliver an “immediate, effective, and decisive response” to any aggression, stressing that they face no geographical limits in confronting aggressors, IRNA reports.

Referring to Iran’s missile capabilities and the deterrent power of its armed forces, Izadi stressed that the country is highly prepared in the fields of missiles, air defence, drones, and naval forces, adding that enemy bases on land and at sea have come under attack.

The UN nuclear watchdog is “increasingly concerned” about an underground uranium-enrichment plant at Isfahan that Iran declared last year but has not let the watchdog inspect, it said in a confidential report on Iran on Friday seen by Reuters.

“The Agency does not know IFEP’s exact location, status for safeguards purposes or whether it contains nuclear material,” the International Atomic Energy Agency said in the quarterly report to member states, referring to the Isfahan Fuel Enrichment Plant (IFEP).

Shelling in Yemen’s Saada has killed five civilians, Al Jazeera reported, citing unnamed Houthi sources.

“The attack targeted the Shada district in Saada, which has long been a Houthi stronghold and is where the group was founded,” the report said.

Houthi sources also said they had carried raids on sites in Taiz and announced they had attacked government military camps with six ballistic missiles, the report added.

Oil prices jumped and settled up by $3 a barrel after attacks on Saudi energy infrastructure escalated and shipping disruptions through the Strait of Hormuz threatened global oil flows, according to Reuters.

Brent futures settled at $95.82 a barrel, up $3.06 or 3.3 per cent. US West Texas Intermediate crude closed at $88.74 a barrel, up $2.21 or 2.6pc.

For the week, both benchmarks were still down about 2.5pc.

Iran’s Revolutionary Guards navy has said a tanker carrying liquefied natural gas struck a naval mine and suffered an explosion in the Strait of Hormuz while using what they described was an “unauthorised and dangerous route”, state media reported, according to Reuters.

No details on the tanker were immediately available.

Oil prices inched down and were headed for a second weekly decline as a continued US blockade of Iran eased fears of renewed fighting in the Middle East, though shipping attacks remained a supply risk, Reuters reports.

Brent futures fell 28 cents, or 0.29 per cent, to $95.54 a barrel at 0527 GMT. US West Texas Intermediate (WTI) futures declined by 56 cents, or 0.63pc, to $88.18 a barrel.

Friday’s declines reversed two days of gains amid a volatile trading week, with earlier hopes for a rapprochement in the US-Israel war against Iran, now in its ninth month, offset by strikes on Saudi Arabian infrastructure by Yemens Iran-backed Houthis and attacks on tankers shipping crude out of the Gulf.