Trump threatened intensified attacks on Iran, stressed U.S. energy independence, and urged allies to secure supply routes, as tensions escalated.
U.S. President Donald Trump said late Monday that he would intensify attacks against Iran over the next two to three weeks in the event of a lack of agreement. The stern warning sent crude futures prices spiking higher but triggered a drop in Asian stocks and bond prices.
The message from the address aligns with the mixed signals the president has recently conveyed about the course of the war, which began on February 27.
Harder Stance: In a livestreamed speech, Trump suggested the U.S. will intensify their efforts, while also stating that Operation Epic Fury, the codename for the current Middle East operations, would be completed shortly. “I can say tonight that we are on track to complete all of America's military objectives shortly, very shortly. We are going to hit them extremely hard over the next 2 to 3 weeks.”
This is an about-face from what Trump stated earlier this week. In an Oval office address, the president said the U.S. would be withdrawing from the Middle East in the next two to three weeks. He followed up with a Truth Social post in which he said the new Iranian regime has sought a ceasefire.
Trump said on Wednesday that regime change was never the U.S. 's objective but a regime change has occurred due to the death of the original leaders. “The new group is less radical and much more reasonable,” he said. At the same time, he conceded that no deal has been made yet but key targets have been accomplished. He also repeated his obliteration threat. “If there is no deal we are going to hit each every one of their electric generating plants very hard and probably simultaneously.”
The president clarified that the U.S. has not hit Iran’s oil but he did not rule out hitting it. He also said bombardment by B-2 bombers has hit Iran’s nuclear sites hard and it would take months to even “get near the nuclear dust.”
Trump boasted about the powerful military operation on account of which Iran is now no longer a threat with just 33 days. He also took potshots at the Obama administration for its Iran nuclear deal.
Solidarity With Gulf Allies: Trump said he will not let the allies from the Middle East, including Israel, Saudi Arabia, Qatar, UAE, and Kuwait to “get hurt or fail in any way, shape or form.”
He blamed the price in gasoline prices in the U.S. to the Iranian regime launching terror attacks on neighboring nations.
US Doesn’t Need Gulf Oil: The Trump administration’s ‘Drill Baby Drill” program has helped the U.S. become self-reliant in oil and natural gas, the president said. “Under my leadership we are the number one producer of oil and gas on the planet without even discussing the millions of barrels that we are getting from Venezuela.”
He noted that the U.S. now produces more oil and gas than Saudi Arabia and Russia combined, adding that the number is going to go up substantially.
Allies Should Act: He also clarified that the U.S. imports almost no oil through the Strait of Hormuz and won’t be taking any through it in the future. Iran has been decimated, both militarily and economically, he said.
Trump said the onus of keeping oil flowing through Hormuz now rests with the countries that receive oil through the chokepoint. He said, “We will be helpful, but they should take the lead in protecting the oil that they desperately depend on.”
The president said many of these countries refused to get involved in the “decapitation of Iran,” attributing it as the reason for the U.S. involvement. He had a two-point solution for the countries — Buy oil from the U.S. and “build up some delayed courage….go to the Strait and take it, protect it, use it for yourselves.” “Iran has been essentially decimated. The hard part is done so it should be easy.”
Trump expressed confidence in the Strait opening up naturally when the conflict is over.
Iran, Allies Show Defiance: Even when Trump keeps shifting his stance, Iran has stayed at it. Iran and its allies, the Houthis and Hezbollah, launched cruise missiles and struck an oil tanker leased to QatarEnergy in Qatar's territorial waters.
A Telegram channel affiliated with Iran's Islamic Revolutionary Guard Corps (IRGC) on Tuesday warned that 17 U.S. companies, including Apple, Nvidia, Microsoft and Google, would be considered “legitimate targets” as a retaliatory measure against U.S.-Israeli attacks.
How Markets Reacted to Trump’s Address: The 10-year U.S. Treasury-note futures slipped 0.25% following the speech, reflecting worries about a lack of resolution worsening the supply shocks and driving up prices.
10-Year US Treasury Note Futures (1-Day Chart)
Source: TradingView
The Intercontinental Exchange (ICE)-traded Brent crude futures contract for June delivery spiked more than 2% to $106 a barrel. The NYMEX-traded WTI crude futures for May delivery climbed 4% to $104.
WTI Crude Futures Chart (1-Day)
Source: TradingView
Asian stocks also headed lower. Japan’s Nikkei 225 average fell more than 1.80% in early trading, the Chinese Shanghai Composite Index fell a more modest 0.40%, and the South Korean Kospi plunged nearly 4%. South Korea’s economy is heavily reliant on imported crude oil and its tech exports suffer when the economic momentum wobbles.
South Korea’s Kopi Index (Thursday’s Trade)
Source: TradingView
Commenting on Trump’s address, gold bull and economist Peter Schiff said, “Stocks, bonds, gold, and Bitcoin are selling off, and oil is rallying as Trump re-escalates the war with Iran, despite the fact that we've already achieved the most glorious and brilliant victory in the history of war.”
He also sees gold breaking the current trend and rallying in tandem with oil.