By Parisa Hafezi, Alexander Cornwell and Phil Stewart
Dubai/Tel Aviv/Washington — The US and Israel pounded Iran on Tuesday with what both the Pentagon and Iranians on the ground described as the most intense airstrikes of the conflict, despite global markets betting that President Donald Trump will call off his war soon.
Raising the stakes for the global economy, Iran’s Revolutionary Guards said they would block oil shipments from the Gulf unless US and Israeli attacks cease while Trump responded by threatening to hit Iran harder unless it flows.
“Today will be yet again our most intense day of strikes inside Iran: the most fighters, the most bombers, the most strikes, intelligence more refined and better than ever,” US defence secretary Pete Hegseth told a Pentagon briefing.
“Ultimately, the aftermath is going to be in America’s interests.”
Tehran residents reached by Reuters also described the war’s most intense night of bombardment.
“It was like hell. They were bombing everywhere, every part of Tehran,” a resident said by phone, speaking on condition of anonymity for security reasons. “My children are afraid to sleep now. We have nowhere to go.”
Yet with Trump having described the war on Monday as “very complete, pretty much“, investors appeared convinced he would end it soon, before the unprecedented disruption to global energy supplies caused a worldwide economic meltdown.
An historic surge in crude oil prices from Monday was mostly reversed within a day and Asian and European share prices staged a recovery from earlier precipitous falls.
A source familiar with Israel’s war plans said the Israeli military was trying to inflict as much damage as possible before the window for further strikes closes, under the assumption Trump could end the war at any time.
Read: Merz warns of dangerous escalation in US-Israeli war against Iran
Iran has refused to bow to Trump’s demand that it let the US choose its new leadership, naming hardliner Mojtaba Khamenei as supreme leader to replace his father, who was killed on the war’s first day.
But occasionally contradictory remarks from Trump at a press conference on Monday appeared to reassure markets he would stop his war before provoking an economic crisis such as those that followed the Middle East oil shocks of the 1970s.
He said the US had already inflicted serious damage and predicted the conflict would end before the four weeks he initially set out.
Trump has not defined what victory would look like but on Monday stopped short of repeating declarations that Iran must let him choose its leader.
’No ceasefire’
Several senior Iranian officials voiced defiance on Tuesday.
Iran parliament speaker Mohammad Baqer Qalibaf posted on X: “Certainly, we are not seeking a ceasefire; we believe the aggressor must be struck in the mouth so that they learn a lesson and never again think of attacking dear Iran.”
The war has effectively halted shipments through the Strait of Hormuz, where a fifth of global oil and liquefied natural gas normally passes along Iran’s coast, and producers have run out of storage and stopped pumping.
In the latest of near-daily reported attacks on shipping that have stopped tankers braving the strait, the UK Maritime Trade Operations Centre reported that crew aboard a bulk carrier in the Gulf had witnessed a splash and a loud bang.
After Iran chose its new leader, oil prices briefly surged to nearly $120 a barrel on Monday. But by 13.20pm GMT on Tuesday, Brent crude had settled back down to about $92, suggesting traders now expected the disruption to end soon.
Trump said on Monday that US military might was sufficient to keep oil flowing. If Iran blocks oil through the strait, “we will hit them so hard that it will not be possible for them or anybody else helping them to ever recover that section of the world,” he said.
But a spokesperson for the Revolutionary Guards said Tehran would not allow “one litre” of Middle Eastern oil to reach the US or its allies while US and Israeli attacks continue.
“We are the ones who will determine the end of the war,” the spokesperson said.
In a later Truth Social post, Trump said: “If Iran does anything that stops the flow of oil within the Strait of Hormuz, they will be hit by the United States of America TWENTY TIMES HARDER than they have been hit thus far.”
Large-scale rallies
Ending the war quickly to let oil flows resume would appear to preclude toppling Iran’s leadership, which held large-scale rallies on Monday in support of the new supreme leader.
Some Iranians openly celebrated the death of the elder Khamenei, weeks after his security forces killed thousands of people to put down anti-government protests in Iran’s worst domestic unrest since the era of its 1979 revolution.
There has been little sign of protests since then amid concerns it would be unsafe while Iran is under attack.
Despite Trump’s maximalist demands for Iran’s “unconditional surrender“, US administration officials have mostly said the war’s aim is to destroy Iran’s missiles and nuclear programme. Israel has been more direct in openly saying it wants Iran’s clerical rulers toppled.
At least 1,332 Iranian civilians have been killed and thousands wounded, according to Iran’s UN ambassador, since the US and Israeli airstrikes began on February 28.
Scores have also been killed in Israeli attacks on Lebanon to root out the Iran-backed group Hezbollah, which has fired into Israel in solidarity with Iran.
Iranian strikes on Israel have killed 11 people. Iran has struck US military bases and diplomatic missions in Arab Gulf states but also hit hotels, closed airports and damaged oil infrastructure.
Iranian foreign minister Abbas Araghchi told PBS that Tehran was unlikely to resume negotiations with the US “because we have very bitter experience of talking with Americans” after Washington twice broke off talks to launch attacks.
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