Increasing Tension Between the US and Iran
Iran also said that it shot down a drone as a warning to the US.
A US official confirmed that a surface-to-air missile shot down an American drone over the Strait of Hormuz, the gateway to the Persian Gulf, a critical shipping lane for oil (NYSEARCA:USO) exports from the Middle East. Iran also said that it shot down a drone as a warning to the US. The news threatens to further escalate rising tension between the US and Iran. Here’s a summary of key issues on this still-evolving story:
- Chief of Iran’s Islamic Revolutionary Guard Corps, Major General Hossein Salami, told Iranian state TV: the downing is “a clear message” to Washington. “Our borders are Iran’s red line and we will react strongly against any aggression. Iran is not seeking war with any country, but we are fully prepared to defend Iran.”
- Oil futures (West Texas Intermediate) surged more than 3% in early trading on Thursday following the news of the Iranian strike on a US drone. “Geopolitics is helping oil bulls to make a spectacular come-back after a few days’ of directionless trading,” says Tamas Varga, an analyst at PVM Oil Associates in London.
- US-Iran tension had been rising before the drone attack. CNN reminds:“Relations between the two adversaries have taken a dangerous turn this week, beginning with the Trump administration’s decision Monday to deploy 1,000 additional troops and more military resources to the Middle East. The forces are being sent in response to what Washington called ‘hostile behavior by Iranian forces that threaten United States personnel and interests across the region.’”
- Iran claims that it shot down the US drone over Iranian airspace – not international airspace. A spokesman for Iran’s Foreign Ministry denounced the “violation” of its airspace, via a report in the country’s Tasnim news agency. Foreign Ministry Spokesman Syed Abbas Mousavi said: “We strongly condemn this kind of aggressive and provocative action. We warn against any violation of Iran’s airspace by foreign flying objects and declare that violators are responsible for the consequences of their actions.”