Markets recoil as Strait of Hormuz turns into a battle zone. ‘We are ready to hit you with crippling fire’

(SeaPRwire) –   Stock futures dropped sharply and oil prices surged on Sunday, as hopes for the full reopening of the Strait of Hormuz were dashed over the weekend due to renewed gunfire.

Dow Jones Industrial Average futures declined by 407 points (0.82%), S&P 500 futures fell 0.67%, and Nasdaq futures dropped 0.57%.

U.S. oil futures rose 7.14% to $89.94 per barrel, while Brent crude climbed 5.9% to $95.71. Gold prices decreased 1.6% to $4,801.40 per ounce.

The U.S. dollar gained 0.2% against the euro and 0.25% against the yen. The 10-year Treasury yield remained unchanged at 4.248%.

Last Friday, President Donald Trump and Iran’s foreign minister announced that ship traffic through the narrow waterway was fully unrestricted, leading to a drop in oil prices and a major stock rally that pushed the S&P 500 to new highs.

However, Trump also stated that the U.S. naval blockade on Iran would stay in place until a deal is finalized, while the Islamic Revolutionary Guard Corps (IRGC) claimed it still controls the strait.

By Saturday, the IRGC declared the Strait of Hormuz closed again to all vessels, regardless of their type or national origin. Ships also reported being attacked by projectiles and small boats, likely part of Iran’s “mosquito fleet.”

Tensions in the Persian Gulf intensified further on Sunday when the U.S. Navy seized a ship for the first time as part of its blockade—with a destroyer firing at a vessel trying to evade the dragnet.

A U.S. Central Command statement said the guided-missile destroyer USS Spruance intercepted the Iranian-flagged M/V Touska as it traveled through the northern Arabian Sea toward Bandar Abbas on Iran’s coast, issuing multiple warnings that it was violating the blockade.

But after the Touska failed to comply over a six-hour period, the Spruance ordered the vessel to evacuate its engine room and fired several rounds from its five-inch gun, disabling the propulsion system, the statement added.

“Motor vessel Touska, motor vessel Touska—vacate your engine room, vacate your engine room,” sailors aboard the Spruance said, according to a video clip released by Central Command. “We’re prepared to subject you to disabling fire.”

U.S. Central Command

On social media, Trump said the Navy “stopped them right in their tracks by blowing a hole in the engineroom,” noting that the Touska was under U.S. Treasury sanctions due to its prior history of illegal activity.

Central Command added that Marines from the 31st Marine Expeditionary Unit later boarded the Touska, which remains in U.S. custody.

The operation followed recent maritime raid drills by Marines. Meanwhile, other signs of combat activity emerged as the Navy conducted mine-clearing operations using drones.

Still, Trump kept the door open to diplomacy by sending envoys to Pakistan to resume talks with Iran. But as of Sunday evening, Tehran had yet to confirm any of its diplomats would attend.

Meanwhile, IRGC-affiliated state media warned Iran is prepared for the possibility of resuming the war and listed critical targets near the Red Sea, in Saudi Arabia, and in the UAE.

“Therefore, Iran is prepared to, with the reconstructions and preparations it has undertaken over the past two weeks, cement unforgettable hellish hours right from the outset of renewed conflict with America and Israel,” Tasnim News said. “Additionally, an analysis of Iran’s positions shows that if the war begins and infrastructure is targeted once again, Iran will completely abandon the restraints it exercised in the first round of the war regarding Bab al-Mandab, Aramco, Yanbu, and Fujairah.”

U.S. Central Command