Breaking news from the Strait of Hormuz! Iran's Supreme Leader issues first statement, saying "will not abandon revenge," one U.S. military tanker shot down, entire crew killed

On March 12th Eastern Time, the three major U.S. stock indices all closed lower. Earlier, Iran’s new Supreme Leader issued his first statement, shattering hopes for a quick de-escalation of the war, which triggered a surge in oil prices, heightened inflation concerns, and led investors to heavily sell off stocks.

U.S. Stocks Plummet Across the Board

All three major indices fell more than 1.5%, with widespread selling. Except for the energy sector and some defensive stocks, most sectors experienced significant declines.

At the close, the Dow dropped 739.42 points, or 1.56%, to 46,677.85; the Nasdaq fell 404.16 points, or 1.78%, to 22,311.98; the S&P 500 declined 103.22 points, or 1.52%, to 6,672.58.

Oil prices surged again sharply. By the end of the day, West Texas Intermediate (WTI) futures for April delivery jumped 9.72%, closing at $95.73 per barrel; London Brent crude futures for May delivery rose 9.22%, closing at $100.46 per barrel.

Major tech stocks declined, with Nvidia down 1.55%, Amazon down 1.47%, Tesla down 3.14%, Meta down 2.55%, Apple down 1.94%, Microsoft down 0.75%, and Google down 1.67%.

The Nasdaq Golden Dragon China Index fell 1.03%. Most popular Chinese concept stocks declined: Xiaopeng Motors down 4.7%, Li Auto and Tencent down over 2%, Alibaba down 1.5%, Pinduoduo down 1.28%. NIO rose 1.46%, Xpeng up 3.6%, and Fangdd Network up 16.4%.

Iran’s New Supreme Leader: No Abandonment of Revenge

Open New Fronts if Necessary

According to CCTV News, Iran’s new Supreme Leader, Mujtaba Khamenei, delivered his first statement on the national television on the 12th, mainly focusing on domestic unity, external conflicts, regional relations, and mourning the late leader Ali Khamenei.

In his speech, Mujtaba Khamenei first expressed condolences for Ali Khamenei’s passing and said that succeeding him is a heavy responsibility. He emphasized that a major tradition of Iran’s revolutionary leadership is relying on the people, highlighting their vital role in governance and wartime.

He called for social unity, continued participation in national affairs, and stressed strengthening social mutual aid during difficult times. He also encouraged the public to actively participate in the upcoming “Jerusalem Day” activities.

Regarding the current situation, Mujtaba Khamenei thanked the Iranian military and resistance forces, stating that Iran’s soldiers have prevented enemies from controlling or dividing Iran. He also said Iran will continue to adopt strategic measures, including blocking the Strait of Hormuz, and open new fronts if necessary.

On regional issues, he urged neighboring countries to close U.S.-used military bases within their borders and clarified that Iran’s strikes target only military facilities, not the countries themselves. He reiterated Iran’s desire to maintain friendly relations with neighbors.

Mujtaba Khamenei also expressed condolences to families of war casualties and the injured, promising medical and economic compensation for affected civilians. He vowed to hold enemies accountable and seek revenge for the fallen.

On the 12th, local time, Iran’s Supreme Leader Mujtaba Khamenei posted four personal photos on social media. In the photos, he appears relaxed, one showing him standing among a crowd, another reading indoors. The specific time and location of the photos have not been disclosed.

U.S. Energy Secretary: “Not Ready” for Escort Missions

According to Xinhua News Agency, U.S. Energy Secretary Chris Wirth said in an interview with CNBC on the 12th that the U.S. is currently “not ready” to escort oil tankers through the Strait of Hormuz.

Wirth said, “(Escort missions) will be implemented soon, but not now,” adding, “We are not ready yet. All our military assets are currently focused on destroying Iran’s offensive capabilities and related manufacturing industries.”

Previously, President Trump stated that if necessary, the U.S. military would escort oil tankers passing through the Strait of Hormuz. However, multiple sources on the 10th revealed that since the U.S. and Israel launched military strikes on Iran, ships near the Strait have requested U.S. escort almost daily, but these requests have been refused due to high risks.

According to foreign media reports, Iran’s military warned the U.S. on the 11th that “prepare for oil prices to reach $200 per barrel, because oil prices depend on regional security, which you are destroying.”

In response, U.S. Energy Secretary Chris Wirth on the 12th said that despite oil tankers still being stranded in the Strait of Hormuz due to the U.S.-Israel conflict with Iran, it’s unlikely that global oil prices will rise to $200 per barrel. He also stated that the government has not discussed a ban on refined oil exports.

Wirth said, “I won’t speculate on short-term trading because it’s more driven by psychological factors than actual oil flows.” When asked whether the U.S. might implement a refined oil export ban, Wirth said the Trump administration has not discussed it.

Trump: Immediate Rate Cuts Needed

On March 12th Eastern Time, President Trump again called on Federal Reserve Chair Jerome Powell to cut interest rates, claiming that the global economic shock caused by the Iran conflict requires immediate action.

Trump posted on social media: “Where is Jerome Powell, the always-too-late Fed Chair? He should cut rates immediately, not wait until the next meeting!”

The Federal Reserve will hold a monetary policy meeting on March 17th. Although recent U.S. inflation data shows overall price increases remain manageable, tensions in the Middle East have sharply pushed up oil prices and threatened global supply chains. Public dissatisfaction with living costs is rising, which is unfavorable for Republicans’ prospects of maintaining control of Congress in the midterm elections in November.

Markets generally expect the Fed to keep the benchmark interest rate unchanged, but their latest economic projections (SEP) will be closely watched for signals of whether inflation expectations are being raised.

Beneath the surge in oil prices, markets are realizing that the likelihood of the Fed cutting rates later this year is rapidly decreasing.

Traders have significantly reduced their bets on rate cuts this year. They no longer believe there is a 100% chance of a rate cut in 2026. Interest rate swaps tied to the Fed’s policy meeting date show traders expect only a 24 basis point cut this year as of Thursday, down from about 30 basis points expected Wednesday evening, which is less than a quarter of a percentage point.

Israel Launches Large-Scale Airstrikes

Regarding the situation, CCTV News reports that on the evening of March 12th, Israel’s Defense Forces announced the start of large-scale attacks on infrastructure in Tehran, Iran’s capital. Around 10:10 PM Tehran time, CCTV reporters heard explosions in Tehran, and the air defense system was activated.

On the evening of the 12th, Israeli Prime Minister Benjamin Netanyahu held his first press conference since launching the large-scale airstrikes on Iran, defending the joint military action with the U.S.

Netanyahu claimed that after nearly two weeks of Israeli-American airstrikes, Iran “has changed dramatically,” and the Iranian Islamic Revolutionary Guard Corps and Basij militia have “suffered heavy blows.”

When asked about possible actions against Mujtaba Khamenei and Hezbollah leader Naim Kassem, Netanyahu said he would not “issue a life insurance policy” for them and that he “does not plan to detail plans or actions at this time.”

He also revealed that he “speaks with Trump every day,” and their communication is “frank and open.”

Iran Claims a U.S. Military Refueling Plane Shot Down

All crew members killed

On the 13th, CCTV reporters learned that Iran’s Hatem Anbia Central Command announced that a U.S. military refueling aircraft was shot down in Iraq by missiles launched by resistance groups, with all crew members dead.

Early on the 13th, Iraqi security sources reported that the downed U.S. refueling plane carried six soldiers.

On the 12th, U.S. Central Command stated that a U.S. KC-135 aerial refueling aircraft crashed in western Iraq during the period of U.S.-Israel military strikes on Iran. CENTCOM said the incident was not caused by enemy fire or friendly fire.