Iran attacked a massive oil tanker, hit by drones off the Dubai coast, in the latest strikes.
A fully loaded giant crude oil tanker off Dubai was set ablaze on Monday, as President Donald Trump warned the U.S. would obliterate Iran's energy plants and oil wells if it does not open the Strait of Hormuz.
The strike on the Kuwait-flagged Al-Salmi is the latest in a string of assaults on merchant vessels by missiles or explosive air and sea drones in the Gulf and Strait of Hormuz since the U.S. and Israel attacked Iran on February 28.
The month-long conflict has spread across the Middle East, killing thousands, disrupting energy supplies and threatening to send the global economy into a tailspin.
Crude oil prices briefly spiked anew after the attack on the tanker, which can carry around 2 million barrels of oil worth more than $200 million at current prices.
Kuwait Petroleum Corp., the ship's owner, said the attack happened early on Tuesday, causing a fire and hull damage, but there were no reported injuries.
Authorities in Dubai later said they had been able to bring the fire under control following a drone attack on the tanker.
The jump in oil and fuel prices has started to weigh on U.S. household finances and become a political tension for Trump and his Republican Party ahead of the November midterm elections, as they have vowed to lower energy prices and ramp up U.S. oil and gas production.
With reference to that, the U.S. national average retail price of gasoline crossed $4 a gallon for the first time in more than three years on Monday, data from price-tracking service GasBuddy showed, as tightening global supplies push U.S. crude prices above $101 a barrel.
The world is facing global economic uncertainty as attacks by both sides are showing no signs of easing, with fears of a wider conflict growing.
Trump said the U.S. was in talks with a "more reasonable regime" to end the war in Iran but also issued a new warning over the Strait of Hormuz.
"Great progress has been made but, if for any reason a deal is not shortly reached, which it probably will be, and if the Hormuz Strait is not immediately 'Open for Business,' we will conclude our lovely 'stay' in Iran by blowing up and completely obliterating all of their electric generating plants, oil wells, and Kharg Island," Trump wrote in a social media post, also threatening to attack Iranian desalination plants.
However, the Wall Street Journal reported Trump had told aides he is willing to end the military campaign even if the strait remains largely closed and leave a complex operation to reopen it for a later date.
Notably, it helped oil prices retreat and lifted stock markets off their lows as investors hoped for some way for hostilities to end swiftly.
When asked about the report, the White House referred to comments made by Secretary of State Marco Rubio, who told Al Jazeera the strait would be open "one way or another" after the U.S. military operation.
