US-Iran war Highlights: Iran warns of ‘timely and precise’ attack if US diplomacy fails - Report

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US President Donald Trump's envoy Jared Kushner said US-Iran communications are likely stronger than ever.

Despite intensified communication, he said the US and Iran have not reached an agreement.

Kushner indicated that discussions are continuing.

Iranian Foreign Ministry spokesperson Esmaeil Baqaei condemned a drone attack targeting the office of the Iraqi Kurdistan prime minister.

The drone strike targeted the prime minister’s office in Iraqi Kurdistan overnight, according to Iranian state media.

Baqaei described the incident as a “highly suspicious development” that requires close attention.

Iran urged authorities to remain vigilant and carefully assess the circumstances surrounding the attack.

Baqaei's comments were carried by Iran's state-run IRNA news agency.

Tehran said it already has laws governing its sovereign rights over the Persian Gulf, Strait of Hormuz and Sea of Oman.

Iranian Foreign Ministry spokesperson Esmail Baghaei said the ministry would cooperate with Parliament on legislation concerning the country's sovereign rights.

Baghaei said Tehran's position on the strategic waterways is based on existing legislation and current developments.

The remarks come amid growing tensions over control and navigation of the Strait of Hormuz, a crucial route for global energy shipments.

US President Donald Trump recently said he plans to declare the Strait of Hormuz “a territory of the United States” after the war with Iran.

Major European and US markets slipped as uncertainty over the Strait of Hormuz outweighed expectations of no immediate US Federal Reserve rate hike.

The US and Iran showed no signs of reaching an agreement to reopen the key shipping route after nearly six months of war.

Brent crude rose 0.4% to $88.89 a barrel, while WTI gained 0.3% to $82.60.

The Dow fell 0.4%, the S&P 500 declined 0.1%, while the Nasdaq edged up 0.1%.

London’s FTSE 100 fell 0.3%, Paris’ CAC 40 dropped 0.7% and Frankfurt’s DAX declined 0.4%.

Israeli Prime Minister Benjamin Netanyahu and US envoy Jared Kushner have discussed placing an American general in charge of verifying the disarmament of Hamas, as Israel insists it will not withdraw from Gaza until the Palestinian militant group gives up its weapons.

The discussions took place in Jerusalem on Monday, a day after Kushner held rare direct talks with Hamas representatives in Egypt as the Trump administration pushes a plan aimed at ending the Gaza war.

An Israeli official said Netanyahu and Kushner agreed that there would be no redeployment of Israeli forces or reconstruction in Gaza before Hamas was fully disarmed.

“It was also agreed that the first step toward the demilitarisation of the Strip would be to require Hamas to hand over its weapons for decommissioning under the supervision of an American general,” the official told AFP.

Iran is shifting from a defensive to a “fully offensive” posture, according to a senior Iranian official who spoke to Reuters.

The policy shift comes amid a deadlock in efforts to reach a permanent end to the US-Iran war.

Peace talks have stalled, with no clear progress toward ending the conflict that began on February 28.

Negotiations over the resumption of oil tanker traffic through the Strait of Hormuz have also ground to a halt.

Iran has warned that it is prepared to escalate tensions in the Strait of Hormuz and the wider region if diplomacy fails.

The Iranian official said Tehran would launch a “timely and precise” military attack to break the US naval blockade if negotiations fail.

Monday was the deadline by which Iran and the US were expected to reach a final agreement under a June 17 memorandum of understanding (MoU).

The MoU established a 60-day timeframe, which could be extended by mutual agreement, for Washington and Tehran to negotiate a broader settlement.

Saudi Aramco is offering crude oil to some Asian refiners outside the Strait of Hormuz through private negotiations, Reuters reported citing two sources familiar with the matter.

Aramco is discussing supplies of Arab Medium and Arab Heavy crude through ship-to-ship (STS) transfers off Fujairah in the UAE.

One source said the cargoes are scheduled for September loading.

Aramco has also been diverting Arab Light crude to Yanbu, a Red Sea port in Saudi Arabia, for exports since the Iran war began.

Iran will escalate tensions in the Strait of Hormuz and the wider region if diplomacy with the US fails, a senior Iranian official told Reuters. The official said Tehran was shifting towards a more offensive policy rather than relying solely on defence.

US President Donald Trump threatened to bomb Oman if it interferes with the US blockade of Iranian ships in the Strait of Hormuz, Fox News reported. Trump said the blockade was putting pressure on Iran and added that he was "in no hurry" to resolve the conflict.

US President Donald Trump reiterated that preventing Iran from obtaining a nuclear weapon remains his "number one Goal" amid stalled diplomatic efforts to resolve the conflict. He said Iran "cannot have" a nuclear weapon "in any way, shape, or form".

Iraq's planned oil pipeline through Syria, aimed at reducing reliance on the Strait of Hormuz, could take at least four years to build and cost $15 billion or more, sources told Reuters. The project is backed by initial feasibility support from a consortium including Chevron.

Two drones attacked the office of the Kurdistan Regional Government's prime minister in Iraq on Monday, the KRG security agency said. The drones were launched from Iranian territory, according to the KRG, with no human casualties reported.

Iranian Foreign Ministry spokesperson Esmaeil Baghaei said talks with Oman are taking longer because of the complexity of the issue, the involvement of multiple actors and efforts by some countries to undermine the process.

Oil tankers from the UAE, Qatar, and Kuwait have been reportedly passing through the Strait of Hormuz with their transponders turned off for several months. Due to the covert nature of these movements, it is difficult to estimate the volume of oil being transported through the strait. However, Bloomberg noted that it is likely higher than the four million barrels per day estimated by the market.

If the war continues, it could push up to 23.4 million more children into poverty by the end of the year, according to a recent United Nations Children’s Fund report. About 80% of those children would be in Africa and Asia, the Associated Press reported.

President Donald Trump told the Pentagon to “substantially reduce” joint military exercises with South Korea, indicating his shift was driven by frustration that the longtime US ally hadn’t provided more support for his war with Iran.

Lebanon saw its deadliest day of fighting in months, heaping pressure on stalled US-Iran negotiations while Washington prepares fresh sanctions.

The Israel Defense Forces said Sunday that it killed Abu Hassan Alaa, a senior Hezbollah commander, in southern Lebanon a day earlier. Eleven people died in the Israeli strikes, making them the deadliest since the sides agreed to a ceasefire at the beginning of June.

Iran's military doctrine is shifting from a defensive posture towards an offensive one, with the country's armed forces preparing to adopt "transformative approaches" and take necessary action at the appropriate time.

Indian shares were expected to start the week on a muted note on Monday, extending the cautious sentiment seen last week, as a lack of progress towards ending the Iran war kept crude oil prices elevated.