Updated ,first published
Washington: Iran has fired missiles at civilian targets in the United Arab Emirates and appeared to strike ships in the Strait of Hormuz as tensions reignited in the Middle East and the price of oil shot up another 5 per cent.
Iran’s renewed aggression came on the first day of US President Donald Trump’s so-called “Project Freedom” to encourage vessels to risk transiting the log-jammed strait by offering a form of military protection, with Trump now calling on Indo-Pacific allies for help.
The US responded in kind, sinking seven Iranian “small boats”, Trump said, and threatening further strikes.
It represents the greatest challenge so far to a four-week-old ceasefire between the US, Israel and Iran that has constrained fighting but failed to lead to a peace agreement or sustained negotiations between the parties.
The UAE’s Ministry of Defence said its air defence systems intercepted 12 ballistic missiles and three cruise missiles launched from Iran on Monday (US time), as well as four drones.
The country’s foreign ministry condemned the “dangerous escalation” from Iran and reserved its rights to respond. Three Indian nationals were injured in the drone and missile attacks, it added.
An “advanced fire” broke out in the petroleum industrial area of Fujairah following an Iranian drone attack, the Fujairah Media Office said. Bloomberg reported the facility struck was a VTTI oil terminal partly owned by IFM Investors, the Australian investment house.
Melbourne-based IFM, owned by 15 superannuation funds including AustralianSuper, Aware Super, Cbus and HESTA, holds a 45 per cent stake in the terminal.
Early indications suggested the damage sustained was slightly more severe than when the facility suffered a drone strike earlier in the war, they said. The previous attack, on March 3, forced the suspension of the terminal’s operations for about three weeks.
Meanwhile, there was an explosion and fire on board a cargo vessel operated by South Korean liner HMM in the Strait of Hormuz, the South Korean Foreign Ministry said. The Panama-flagged cargo ship operated by South Korean shipper HMM was empty and at anchor when the explosion and fire occurred.
Trump appeared to confirm the incident was related to an Iranian attack as he called on Seoul to assist in the military mission to guide ships through the waterway.
“Iran has taken some shots at unrelated Nations with respect to the Ship Movement, PROJECT FREEDOM, including a South Korean Cargo Ship,” he posted on social media.
“Perhaps it’s time for South Korea to come and join the mission! We’ve shot down seven small Boats or, as they like to call them, ‘fast’ Boats. It’s all they have left. Other than the South Korean Ship, there has been, at this moment, no damage going through the Strait.”
South Korea’s Foreign Ministry has said that the exact cause of the explosion is yet to be determined and “would be figured out after the vessel is towed and its damage is assessed.”
Trump announced “Project Freedom” on the weekend, saying the US Navy would guide ships safely out of the strait. Many have lingered in the Persian Gulf for two months since the war’s outbreak and are running low on food.
The US president said the exercise was a humanitarian gesture and anyone who interfered would “have to be dealt with forcefully”.
He later told Fox News that if Iran attacked American vessels involved in the exercise, “they’ll be blown off the face of the earth”.
As part of the initiative, American guided-missile destroyers have moved through the strait into the Persian Gulf, although they are not believed to be providing a physical escort for ships wishing to exit the Gulf.
US Central Command – the military division in the Middle East – said it had “reached out” to dozens of ships and shipping companies to encourage them to move through the strait.
Two US-flagged merchant ships successfully transited the waterway as a first step, Centcom said. Danish liner Maersk confirmed the Alliance Fairfax, a US-flagged vessel operated by one of its subsidiaries, made it through unharmed.
Iranian Foreign Minister Abbas Araghchi, who is part of Iran’s negotiating team, said the events in the strait demonstrated there could be “no military solution to a political crisis”.
He insisted that talks were progressing and warned the US and UAE not to be “dragged back into the quagmire by ill-wishers”. Project Freedom was really “Project Deadlock”, he added.
The promise of US Navy assistance failed to calm markets amid the renewed hostilities on Monday (US time), with the price of Brent crude climbing nearly 6 per cent to just below $US115 a barrel. In the US, the national average price of petrol rose above $US4.45 a gallon ($1.64 a litre).
Danny Citrinowicz, an Iran researcher at Israel’s Institute for National Security Studies, said that when faced with a choice between escalating or capitulating, Tehran would choose to escalate.
“Many of those shaping [US] policy regarding Iran still struggle to fully understand the nature of the adversary they are dealing with,” he said on X.
“Even now, renewed threats are unlikely to change Tehran’s behaviour. If anything, Iran’s actions today serve as further evidence of that reality.”
Despite the latest developments, Trump maintained that a deal to permanently end the war was still possible. In an interview on the Christian conservative Salem News Channel, he said Iran’s leaders were privately much more amenable to a deal than they would admit publicly.
He also repeated his claim that Iran’s oil stocks would “literally explode” in about two weeks because of a lack of storage, forcing Tehran to the table. This is contested by experts, who note that while Iran is running low on oil storage, it can reduce production.
Jennifer Kavanagh, a senior fellow at isolationist think tank Defence Strategies, said the closure of the Strait of Hormuz was a problem caused by US military power, not one that American military power could resolve. “The sooner Washington accepts this, the sooner we can start working toward a diplomatic resolution,” she said.
Meanwhile, in an interview to The New Yorker magazine, former US president Barack Obama said Israeli Prime Minister Benjamin Netanyahu had lobbied him for a military confrontation with Iran during his time in the White House, and that under Trump, Netanyahu may have “gotten what he wanted”.
Michael Koziol is the North America correspondent for The Age and Sydney Morning Herald. He is a former Sydney editor, Sun-Herald deputy editor and a federal political reporter in Canberra.Connect via X or email.