Iran-US war latest: Trump’s forces dismiss Tehran’s claim that mines blew up oil tanker in Strait of Hormuz

Egypt’s president Abdel Fattah al-Sisi is set to roll out the red carpet for Saudi crown prince Mohammed bin Salman on Tuesday, the Egyptian presidency said.

The meeting comes against the backdrop of intensified fighting between Iranian-backed Houthi rebels and Yemen’s Saudi-backed government.

The two leaders will hold a bilateral meeting to discuss the Houthi offensive and developments in Iran.

The Houthi rebels’ weeklong offensive has culminated in the capture of Yemen’s Red Sea coast, cementing their hold on the Bab el-Mandeb Strait, through which Saudi oil transits.

Earlier, Cairo rejected a proposal from the Houthis for direct talks to coordinate maritime traffic through the waterway and the Red Sea, according to Qatari media outlet Al-Araby Al-Jadeed.

The United States imposed new sanctions on Russia’s VTB Bank on Monday, accusing the lender of helping Iran evade Western sanctions ⁠and warning that foreign institutions that continue doing business with Russia’s second-largest bank could face additional penalties.

Already cut off from the dollar system over Russia’s invasion of Ukraine, VTB now faces Iran-related sanctions that Treasury officials said could expose foreign banks and businesses that continue to deal with it to additional penalties.

Treasury said VTB had opened offices in Iran, established banking relationships with sanctioned Iranian ⁠lenders and helped build financial channels designed to facilitate trade ​and financial ⁠coordination between Moscow and Tehran.

The action, taken under an executive order aimed at increasing pressure on the Iranian economy, adds to US sanctions already in place against VTB Bank that were ⁠imposed in February 2022.

The Treasury said in a ​statement that ⁠state-controlled VTB was now “among the most comprehensively sanctioned ‌financial institutions in the world.” The Iran-related penalties would increase the risk of secondary sanctions against foreign institutions that continue to do business with VTB, the Treasury added.

“Under Operation Economic Outcast, Treasury will continue to target and disrupt ‌those who provide material, technological, or financial support that allows the ‌Iranian regime to sustain its terrorist enterprise,” Treasury Secretary Scott Bessent said in the statement.

“Treasury will not tolerate any support to the regime and will continue to identify, expose, and isolate Iran’s enablers,” it quoted him as saying.

The Iran Revolutionary Guards Corps claimed it detected and destroyed an advanced MQ-1 drone over the western Strait of Hormuz early on Tuesday using a new Aerospace Force air defence system.

It comes following a similar IRGC statement on Monday that it had shot down an MQ-1 drone over the strait.

US crude rose 1.82 per cent to $103.24 a barrel ​while Brent gained ⁠1.6 per cent to $107.37.

Markets are unsettled after Yemen’s Iran-aligned ⁠Houthis launched a new wave of attacks on Saudi Arabia on ​Monday, ⁠after Riyadh blamed Iran-backed fighters in Iraq for an attack on the kingdom’s east-west pipeline.

It is likely to disrupt as much as 4 per cent of global oil supply. Gulf Arab states also postponed ⁠planned talks with Iran.

“Markets are likely to remain focused ‌on the risk that higher crude oil prices could add to inflationary pressures and, in turn, push interest rates higher,” Yokoo Akihiko, an analyst at Mitsubishi UFJ Bank, said in a note.

The US military has rejected an Iranian claim that a Panama-flagged oil tanker struck naval mines in the Strait of Hormuz, saying the vessel was instead attacked by an Iranian drone.

US Central Command said the El Gaia was struck by an Iranian missile last month, which rendered the tanker “inoperable”, before it was hit again by an Iranian drone over the weekend while it was in waters off Oman.

The vessel is now being towed by a regional partner.

The Islamic Revolutionary Guard Corps (IRGC) had claimed the tanker struck naval mines and caught fire in Hormuz.

Doctors Without Borders (MSF) said Israeli forces launched a strike on a clearly identified aid convoy in besieged Gaza, injuring at least one humanitarian worker on Monday.

“An MSF bus carrying 10 humanitarian staff in Gaza City was damaged by an Israeli airstrike on a targeted vehicle just two metres away. One of our colleagues was injured in the strike,” the NGO said in a statement.

“The bus was clearly identified as an MSF vehicle, with a large MSF sticker visible on its roof. Once again, Israeli forces have shown a blatant disregard for the safety of humanitarian and medical personnel,” Doctors Without Borders added

The Saudi-led coalition ⁠in Yemen said on ⁠Tuesday ​that ⁠13 ⁠civilians ​were injured ⁠in ‌attacks by the Iran-aligned ‌Houthis ‌on the ⁠Saudi cities of Khamis Mushait, Abha and ‌Taif ​on ‌Monday.

In a statement posted on X, coalition spokesman Major General Turki al-Malki said the injuries ranged from minor to moderate and that seven houses and two vehicles were damaged.

He added the coalition would respond “responsibly and firmly” and take what it called necessary operational measures to deter further attacks.

The US spent an estimated $22.3bn on munitions during the first four months of its war with Iran, according to a Pentagon watchdog report.

The Defense Department’s inspector general estimated that the war had cost the US military $33.4bn by 29 June, including $22.3bn in expended munitions, $3.7bn in destroyed or lost equipment and $7.4bn in additional costs, largely covering day-to-day military operations.

The estimate does not include the cost of repairing US military bases damaged by Iranian counterattacks, the report said. Facilities in Kuwait, Bahrain, Qatar, the United Arab Emirates, Saudi Arabia, Iraq, Oman and Jordan were damaged.

The scale of weapons use has exposed weaknesses in the US defence industrial base, with the inspector general citing the Pentagon’s acquisition office as saying that the expended munitions had “resulted in strategic inventory shortfalls and revealed industrial base bottlenecks for munitions resupply”.

The Pentagon is now working to speed up procurement and production, while stockpiling critical materials, components and selected munitions to ensure it can respond more quickly to future conflicts, the report said.

The US also suffered significant equipment losses during the conflict. Up to 30 MQ-9 Reaper drones were destroyed, along with four F-15E fighter jets and several other aircraft, according to the report.

Several aircraft and helicopters were also destroyed during a US search-and-rescue operation in early April to recover an Air Force officer stranded deep inside Iran.

Separately, the State Department incurred $113m in costs by early June, including the evacuation of American diplomats and US citizens from the region.

Iranian attacks also caused an estimated $184m in damage to US diplomatic facilities in Iraq, Kuwait, Saudi Arabia and the UAE, the report said.

The figures cover the period through 29 June. In late July, Defence Secretary Pete Hegseth told Congress that the war had cost the US about $37.5bn.

Mohsen Rezaei, secretary of Iran’s Supreme National Security Council, said Iran should not be distracted by mixed signals from Donald Trump.

“Don’t get distracted by the US president’s mixed signals—from ‘no negotiations’ to ‘we’re ready to talk,’” Rezaei wrote in a post on X.

“The stakes around oil and the straits have changed. Damage control won’t stop what’s coming,” he added.

“No talks until Iran’s conditions are met. Period!”

It comes after Trump said the US was “open” to “concept” of negotiating deal with Iran

“The failing Nation of Iran wants to make a deal, quickly and badly. I will determine whether or not the U.S.A. will choose to engage — The concept of which we are open to,” Trump said on his social media platform on Monday.

The Saudi Arabian Civil Defence sent an all clear ⁠on Tuesday after issuing alerts for potential danger in six cities ⁠including Yanbu, ​the ⁠kingdom’s main Red Sea oil port, where ⁠millions of barrels ​a ⁠day are loaded.

Saudi ‌Civil Defence said the danger had passed ‌in Jeddah, Abha, Jazan, ‌AlUla and Taif after the areas received ⁠emergency alerts amid an uptick in attacks by Yemen’s Iran-aligned Houthis.

The Houthis have stepped up attacks on Saudi cities ‌and energy infrastructure while ​advancing along Yemen’s ‌Red Sea coast ⁠towards the Bab ⁠el-Mandeb Strait, a key ‌shipping route.