Iran strikes US base in Jordan for 3rd time, oil tops $79

Iran's military said early Tuesday it conducted sustained drone strikes against US bases in the region, hitting the Azraq air base in Jordan for a third time and targeting F-18 fighter deployment areas, dormitories and large equipment warehouses with suicide drones.

"The Islamic Revolutionary Guard Corps continues to strike US military bases in the region," the Iranian military said in a statement carried by state media, without specifying the number of drones used or confirming casualties at the Muwaffaq Salti Air Base, also known as Azraq, which hosts roughly 4,000 US troops.

"The risk premium embedded in crude oil is now the highest since the April 2024 Iran-Israel exchange, and it's not going away until there's a verifiable de-escalation," said Elena Fischer, geopolitical risk analyst at Edgen. "Each successive strike reduces the threshold for the next one."

Brent crude rose 3.9% to $78.99 a barrel Sunday, while West Texas Intermediate climbed 3.4% to $73.87, as the escalating confrontation threatens the Strait of Hormuz, a chokepoint handling about 21% of global oil trade. The US average gasoline price stood at $3.87 a gallon, up 30% from before the conflict began in late February, according to AAA data. Dow Jones futures slipped 0.2% and S&P 500 futures fell 0.3% in Sunday evening trading.

The latest strike follows a pattern of intensifying tit-for-tat exchanges. The US said it hit about 140 Iranian military sites in an overnight aerial assault over the weekend, after which Iran retaliated by targeting US bases in Kuwait, Bahrain and Jordan. Jordan's military said it intercepted four missiles from Iran on Monday, while Kuwait reported drone damage to border posts and an offshore oil drilling rig. The last time Iran directly targeted a US base with ballistic missiles was January 2020 at Al Asad in Iraq, which caused traumatic brain injuries to more than 100 US service members.

What's at stake in the Strait of Hormuz

The waterway remains the central lever in Tehran's negotiating strategy. Washington and Tehran have made contradictory claims about the status of marine traffic, with President Donald Trump insisting the strait remains open while Iran claims to have clamped down on vessel movement. Tracking data shows traffic was reduced to a trickle over the weekend. Iran has warned vessels against using alternative routes along the Omani coastline, though a naval advisory board says the Omani southern route remains open.

The IRGC said it also struck US military infrastructure in Kuwait and Bahrain in earlier waves, claiming to have destroyed fuel storage tanks and Patriot air defense systems at Ali Al Salem base in Kuwait and targeting helicopter maintenance facilities at the US Air Base in Sheikh Isa, Bahrain. US Central Command said no American service members were hurt in those attacks.

Pakistan, which mediated the US-Iran memorandum of understanding signed last month, urged all sides to exercise restraint. Tehran condemned the US strikes as war crimes, accusing Washington of violating the agreement reached just 25 days earlier.

For investors, the key transmission mechanism runs through oil. If Brent crude sustains above $80 a barrel on escalation fears, the inflationary impulse could delay or reduce the scope of any Federal Reserve rate cuts, tightening financial conditions across risk assets. Defense and aerospace stocks may see a temporary rally, while broad equity indices face headwinds from higher energy costs and geopolitical uncertainty.

This article is for informational purposes only and does not constitute investment advice.