Iran Accuses Trump of 'Theater Diplomacy'; Hormuz Traffic Drops

Oil prices rose after reports that Iran plans to bar U.S. and Israeli ships from Hormuz. Brent crude futures for October delivery gained 1.3% to $83.55 a barrel. September WTI crude futures rose about 1.1% to $78.17. The move reversed an earlier slide driven by optimism that a Hormuz deal was days away.

Iran plans to bar U.S. and Israeli ships from the Strait of Hormuz under a draft plan with Oman for managing the waterway, Tehran's semi-official Fars news agency reported Thursday. Restrictions would extend to countries that have "caused damage" to Iran, until compensation is paid. Iran also plans to impose penalties of up to 20% of the value of cargo for violators.

Regional officials said earlier that Iran and Oman were close to finalizing a framework covering inbound traffic via Iranian territorial waters and outbound traffic through a route closer to Oman. The arrangement would not automatically reopen the waterway.

The conflict is broadening. Saudi Arabia is bracing for "multiple coordinated attacks" by Iraqi militia factions working with Iran-backed Houthis, a Saudi official told CNN. Intelligence reports indicated the groups planned to strike the kingdom "in the very near future" under guidance from Iran's Islamic Revolutionary Guard Corps. The warning came a day after the Houthis claimed responsibility for attacks on two Saudi oil tankers in the Gulf of Aden.

In a Truth Social post Thursday, Trump pushed back on reports that U.S. munitions stocks have been depleted. "The U.S. has massive amounts of 'munitions,' especially of certain types," he said, vowing "long-term jail sentences" for leakers. CNN reported later that Trump acknowledged in the Oval Office that certain munitions are in "tighter" supply, while insisting less-advanced weapons remain in virtually unlimited supply.