The United States and Iran traded fresh threats, dimming hopes of a near-term resolution to the intensifying Middle East conflict, now in its fifth week.
The war is rattling financial markets, disrupting supply chains and raising fears of wider economic fallout, particularly for energy-dependent economies.
Tehran warned of “crushing” retaliation against the United States and Israel, hours after President Donald Trump said American forces would strike Iran “extremely hard” in the coming weeks.
The exchange underscores a deepening cycle of brinkmanship unsettling global markets.
Trump said Washington would achieve its objectives soon but warned the conflict could escalate further if Iran refuses to comply with US demands in negotiations.
Iran’s military leadership responded with warnings of “more crushing, broader and more destructive” attacks if hostilities continue.
Officials said the war would persist until what they described as the “surrender” of Iran’s adversaries.
Analysts warn the conflict could inadvertently strengthen Tehran’s strategic leverage by demonstrating its ability to disrupt maritime trade and energy flows.
Iran’s parliament is reviewing legislation that could formalise restrictions on vessels from hostile nations passing through the Strait of Hormuz, potentially including tolls.
Such measures could institutionalise Iran’s influence over the critical waterway and reshape regional power dynamics.
For Gulf states, the risks are rising.
While avoiding direct military retaliation, they remain exposed to economic and security shocks, with fears that any partial settlement could leave long-term instability.
Germany has sought China’s support to de-escalate tensions, with Foreign Minister Johann Wadephul holding talks with Chinese Foreign Minister Wang Yi.
Both sides stressed the need for a swift resolution and maintaining freedom of navigation through the Strait of Hormuz.
Berlin warned that no single country should control vital sea lanes or impose tolls on international shipping.
Russian President Vladimir Putin and Saudi Crown Prince Mohammed bin Salman called for a “rapid cessation of hostilities” in a phone conversation.
According to the Kremlin, both leaders urged intensified diplomatic efforts for a long-term settlement and flagged growing risks to global energy security.
The talks come as Saudi Arabia faces rising security threats while balancing its international defence partnerships.
United Nations Secretary-General António Guterres issued a fresh appeal to stop the war, warning it risks spiralling into a broader regional conflict.
“To the United States and Israel, it is high time to stop the war,” he said, urging Iran to show restraint.
He said a special envoy would be sent to the region to intensify diplomatic efforts.
Austria denied US requests to use its airspace for operations against Iran, citing neutrality laws.
Spain has also barred US military aircraft linked to the conflict, while Italy reportedly denied access to a base in Sicily.
The moves reflect widening divisions among Western allies over the war.
Pakistan has stepped up efforts to mediate between Washington and Tehran, positioning itself as a neutral interlocutor.
Officials said both sides have expressed confidence in Islamabad’s role.
In a limited signal of easing tensions, Iran recently allowed Pakistani-flagged vessels to pass through the Strait of Hormuz.
Despite diplomatic efforts, the path to de-escalation remains uncertain, with markets and governments bracing for broader economic and geopolitical fallout.
