President Donald Trump has vowed to intensify military strikes against Iran over the next two to three weeks, dashing investor hopes for a near-term resolution and sending oil prices surging and stock markets sliding after a prime-time address that offered no clear path to ending the five-week conflict.
“We’re going to hit them extremely hard over the next two to three weeks,” Trump said in his Wednesday evening speech. “We’re going to bring them back to the Stone Ages where they belong.”
Benchmark Brent crude jumped roughly 5% to $106.16 a barrel after the address, as Trump offered no reassurance about when or how the Strait of Hormuz — the conduit for around a fifth of global oil and liquefied natural gas supplies — would reopen. US index futures fell 1% and European futures dropped more than 1.5%. Japan’s Nikkei fell 1.8% and MSCI’s broader Asia-Pacific index shed more than 1.5%.
“If he was trying to inspire confidence in the markets, he has not done that,” said Russel Chesler, head of investments and capital markets at VanEck Australia. “The key question in all investors’ minds is ‘When is this going to be over?’ That is what is creating the volatility.”
Shortly after the speech, Israel’s military said it had identified missiles launched from Iran toward Israeli territory.
No deal required — but no timeline either
Trump said the US did not need the Strait of Hormuz and challenged oil-dependent allies to work towards reopening it themselves. “Go to the Strait and just take it,” he said, arguing that Iran had been “essentially decimated” and that “the hard part is done.”
He also claimed that US-Israeli strikes had ensured Iran would not obtain nuclear weapons, telling Reuters earlier on Wednesday that forces could return with “spot hits” if the threat resurfaces. “They were right at the doorstep of a nuclear weapon,” he said in his address, without providing evidence.
Trump said discussions were continuing with Iranian leaders he considered more moderate, and claimed on social media that Iran had requested a ceasefire — a claim Tehran flatly denied. A senior Iranian source told Reuters that Tehran was demanding a guaranteed ceasefire before halting its attacks and that no talks through intermediaries on a temporary truce had taken place.
Two Pakistani security sources told Reuters that Islamabad — which is mediating in the conflict — had proposed a temporary ceasefire but had received no response from either side. US Vice President JD Vance communicated with Pakistani intermediaries as recently as Tuesday, according to a source briefed on the matter, signalling Trump remained open to a ceasefire if certain conditions were met.
IMF, World Bank and IEA warn of global damage
The International Monetary Fund, World Bank and International Energy Agency issued a joint warning on Wednesday that the war was having “substantial, global and highly asymmetric” effects and said they would coordinate their response, including potential financial support for the hardest-hit countries.
Trump addressed rising petrol prices at home, blaming Iran exclusively. “This short-term increase has been entirely the result of the Iranian regime launching deranged terror attacks against commercial oil tankers of neighbouring countries that have nothing to do with the conflict,” he said.
France’s junior army minister Alice Rufo said any NATO operation in the Strait of Hormuz would constitute a breach of international law, as European states sought to distance themselves from Trump’s calls for allied military action in the waterway.
(Reuters)
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