Iran strikes 85 U.S. military sites in the Gulf, sparking a global selloff in stocks and a spike in the price of oil

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Back to boiling point: Oil rises as conflict resumes in the Middle East

The war is back on. Iran said today it had struck 85 U.S. sites in Bahrain and Kuwait, in the latest escalation of a fast-developing situation in the Gulf.

Those strikes came after U.S. forces struck targets in Iranian coastal areas yesterday and overnight. And that came after Iran fired on three tankers in the Strait of Hormuz, which Iran believed had not complied with its control of the passage. Kuwait, Qatar, and Saudi Arabia all condemned Iran for harassing their ships. The U.S. reinstated sanctions on Iranian oil sales. Iran’s foreign minister, Abbas Araghchi, said the U.S. was in "flagrant violation" of the memorandum of understanding. Live coverage from the BBC here.

The price of Brent crude oil spiked up from $72 per barrel yesterday to $78 this morning.

Context: The ceasefire isn’t totally dead, yet. Both the U.S. and Iran will be reluctant to return to full-scale warfare. The fact that the U.S. struck Qeshm Island, Bandar Abbas, and Sirik—as opposed to Tehran or the regime’s nuclear development sites—is a signal that the Pentagon believes this round of fighting can be limited, if Iran allows traffic in the Strait to resume.

The danger is that the U.S. and Iran will remain stuck in an endless round of retaliations that will render the Strait largely impassable for the foreseeable future. The conflict is now in its fourth month.

Traffic report: As this chart from Deutsche Bank shows, shipping in the Strait is far from normal:

President Trump is at the NATO summit in Turkey today, causing controversy

On the Iran ceasefire, Trump said, “as far as I’m concerned, it’s over,” but also added that negotiations would continue.

The president also criticized his allies for not handing over Greenland to the U.S. and for not being supportive enough in his assaults on Iran. The Europeans remain baffled by Trump’s obsession with the Arctic country and annoyed that Trump doesn’t appreciate the European bases that have been used to launch strikes on Iran or the minesweeping ships they have sent to the Gulf.

Elsewhere, solidarity:........

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