U.S. embassy in Riyadh hit by drones

U.S. Marines fired on demonstrators storming the U.S. consulate in Karachi, Pakistan, over the weekend, Reuters reported, citing two U.S. officials.

It was unclear whether rounds fired by Marines struck or killed anyone, or if the shots were fired by other protective details such as private security guards and local police, the sources told Reuters.

The protests happened on Sunday after Iranian Supreme Leader Ayatollah Ali Khamenei was killed in joint U.S.-Israeli strikes on Iran.

The U.S. Embassy in Islamabad said Monday it was monitoring reports of ongoing demonstrations at its missions in Pakistan, including the capital, its consulates in Karachi and Lahore, and the Consulate-General in Peshawar.  

— Lim Hui Jie

Israeli Prime Minister Benjamin Netanyahu said Monday that military action against Iran may continue for some time, but stressed that it's not going to take years, in an interview with Fox News.

"This is not an endless war, this is the gateway to peace," Netanyahu said on Fox News' "Hannity" program, adding that he sees a lasting path to stability in the Middle East.

He also argued that action against Iran could also pave the way for peace between Saudi Arabia and Israel, and maintained that while regime change ultimately rests with the Iranian people, the U.S. and Israel are "creating the conditions" for them to do so. 

— Lee Ying Shan

Amazon's cloud computing unit confirmed three of its data centers in the Middle East were damaged by drone strikes, taking the facilities offline.

The company posted in an update to its Amazon Web Services health dashboard that two facilities in the United Arab Emirates were "directly struck" by drones on Sunday, causing extensive damage. A site in Bahrain was damaged due to a drone strike that occurred nearby.

"These strikes have caused structural damage, disrupted power delivery to our infrastructure, and in some cases required fire suppression activities that resulted in additional water damage," the company wrote.

AWS encouraged customers to consider migrating workloads to other regions as the situation in the region remains "unpredictable." It also said expected a prolonged recovery "given the nature of the physical damage involved."

— Annie Palmer

The Islamic Resistance in Iraq said it had conducted a "drone swarm attack" on a hotel housing U.S. troops in the Iraqi city of Erbil, Reuters reported Tuesday.

The Iran-backed group said on Sunday that it had conducted 23 operations using dozens of drones targeting U.S. air bases in Iraq and the region.

The Islamic Resistance in Iraq is an umbrella term used to describe operations by all Iran-backed Iraqi militias.

— Lim Hui Jie

Israeli Prime Minister Benjamin Netanyahu told Fox News that Iran's "ballistic missile program and atomic bomb program" were months away from becoming "immune" without action, prompting what he described as the urgent need for Operation Epic Fury.

Without swift intervention, he said, Tehran would have completed new fortified sites and underground bunkers within months, effectively shielding its weapons programs from future military strikes.

"Action had to be taken," Netanyahu said. "You needed the resolute President like Donald J. Trump to take that action."

Netanyahu argued that earlier strikes on Iran's nuclear and missile facilities had failed to deter Tehran, accusing its leadership of being "totally fanatic" in pursuing what he described as the goal of destroying America.

— Lee Ying Shan

U.S. President Donald Trump told NewsNation that details of Washington's response to the attack on the U.S. Embassy in Riyadh, and for the deaths of American military personnel in the Iran conflict, would be revealed "soon," according to a reporter from the outlet who shared excerpts of the interview on X on Monday.

Trump also said that boots on the ground won't be necessary, according to the reporter's post.

Saudi Arabia's Defense Ministry said earlier that the U.S. Embassy had been hit by drones, causing a small fire and minor material damage.

— Vinay Dwivedi

The U.S. Embassy in Saudi Arabia's capital city Riyadh was hit by two drones on Tuesday morning, according to the Middle Eastern country's Defense Ministry.

The drone attack resulted in a "limited fire and minor material damage" to the building, according to the defense authority.

The U.S. Embassy in Saudi Arabia has issued a warning for people in Jeddah, Riyadh and Dhahran to hide in a shelter and limited nonessential travel to any military installations in the region.

"We recommend American citizens in the Kingdom to shelter in place immediately," the embassy said in a post on X.

— Anniek Bao

Speaker Mike Johnson, R-La., on Monday said following a classified briefing with Secretary of State Marco Rubio that the U.S.'s attack on Iran was a "defensive operation," the goal of which was not regime change.

"Israel was determined to act in their own defense here. With or without American support. Why? Because Israel faced what they deemed to be an existential threat," Johnson told reporters at the Capitol following the briefing.

"The objective was to take out those missiles, the short and midrange missiles, and their ability to produce them," Johnson said, adding that the second objective was to eliminate Iran's naval capabilities. "The ayatollah is no more. That was not the mission of the U.S. to go in and take out the regime, but that happened and in my estimation that is a great development for freedom loving people around the world."

—Justin Papp

Upon leaving a briefing on the war in Iran with Secretary of State Marco Rubio, Senate Minority Leader Chuck Schumer, D-N.Y., told reporters "I found their answers completely and totally insufficient."

"In fact, at least to me, that briefing raised many more questions than it answered," Schumer said. He did not take any questions.

—Justin Papp

The U.S. State Department on Monday urged Americans in more than a dozen countries in the Middle East to "depart now" due to the ongoing conflict in the region.

The list of countries include Bahrain, Egypt, Iran, Iraq, Israel, the West Bank and Gaza, Jordan, Kuwait, Lebanon, Oman, Qatar, Saudi Arabia, Syria, the UAE and Yemen.

In a video post, Secretary of State Marco Rubio also spoke directly to "Americans in the Middle East" about the work the State Department was doing to try to keep them safe.

—Riya Bhattacharjee

Secretary of State Marco Rubio said the U.S. military has not yet delivered its strongest attacks against Iran.

"I'm not going to give away the details of our tactical efforts, but the hardest hits are yet to come from the U.S. military," Rubio told reporters on Capitol Hill.

"The next phase will be even more punishing on Iran than it is right now," he said.

The remark echoes Trump, who told CNN earlier Monday, "The big wave hasn't even happened. The big one is coming soon."

Rubio, like Trump and Defense Secretary Pete Hegseth, also said it was unclear how long the warfare in Iran is expected to last.

"I don't know how long it will take .... We have objectives. We will do this as long as it takes to achieve those objectives. And we will achieve those objectives; the world will be a safer place when we're done with this operation," Rubio said.

— Kevin Breuninger

The death toll of U.S. service members killed in action during the war has risen to six, U.S. Central Command said.

The tally rose from four earlier in the day after "U.S. forces ... recovered the remains of two previously unaccounted for service members from a facility that was struck during Iran's initial attacks in the region," Central Command said in a post on X.

"Major combat operations continue. The identities of the fallen are being withheld until 24 hours after next of kin notification," the tweet said.

— Dan Mangan

Gold is doing what gold does in times of geopolitical uncertainty: spiking. The spot price surged to $5,400 in overnight trading before settling back in the $5,300 range by early Monday afternoon.

While down from its record high of $5,594 on Jan. 29, the price of gold may have more room to run. J.P. Morgan analysts said in a new research note that "conflict-driven surges in gold come and go, though geopolitical risks broadly are likely to stay on the boil," which partly contributes to their forecast of gold reaching $6,300 by the end of 2026.

For investors who think they want to be in gold, it's worth noting that many financial advisors recommend keeping alternative investments — including gold — to 5% or 10% of your portfolio.

"Gold has had long periods where it's done absolutely nothing, and long periods when it's been very volatile," said certified financial planner Patrick Huey, owner and principal advisor with Victory Independent Planning in Naples, Florida. "And you can certainly lose money in gold."

— Sarah Agostino

Secretary of State Marco Rubio insisted that "there absolutely was an imminent threat" to the U.S. from Iran that justified launching a widespread military offensive against the Middle Eastern nation.

"We knew that if Iran was attacked, and we believed they would be attacked, that they would immediately come after us," Rubio told reporters on Capitol Hill.

He suggested that Israel was planning an initial strike on Iran, and that the Trump administration then opted to launch its own preemptive attack in order to avoid further U.S. casualties.

"We knew that there was going to be an Israeli action. We knew that that would precipitate an attack against American forces, and we knew that if we didn't preemptively go after them before they launched those attacks, we would suffer higher casualties," Rubio said.

"We were not going to sit and sit there and absorb a blow before we responded," because doing so would result in "more casualties and more deaths," he said.

The Cabinet secretary's remarks came after Trump administration officials reportedly told congressional staff on Sunday that there was no intelligence suggesting Iran was planning a first strike on U.S. forces.

Rubio said Monday, "We went proactively in a defensive way to prevent them from inflicting higher damage."

"Had we not done so, there would have been hearings on Capitol Hill about how we knew that this was going to happen and we didn't act preemptively."

— Kevin Breuninger

Senate Minority Leader Chuck Schumer, D-N.Y., on Monday called President Donald Trump "one of the most trigger happy presidents in all of American history" from the Senate floor on Monday, as the chamber reconvened for the first time since U.S. strikes on Iran.

Schumer urged senators to support a war powers resolution to curb Trump's military action in Iran that will get a vote on the Senate floor this week.

"Our resolution affirms what the constitution already says. The president cannot send U.S forces to fight a war in Iran without congressional approval," Schumer said. "As soon as our resolution comes to the floor, senators need to pick a side: stand with Americans who don't want war. Or stand with Donald trump as he singlehandedly starts another war."

—Justin Papp

Thousands of flights have been canceled since Saturday due to ongoing strikes in the Middle East — and, for many people, travel insurance may not offer a financial backstop.

Many standard policies exclude certain benefits in the event of military action, war and government-mandated airspace closures, experts said.

If that's the case, insurers may not reimburse impacted travelers for nonrefundable costs like flights, hotel nights, meals and tours.

But much depends on the specific insurer and the fine print of the insurance policy. Travelers may qualify for benefits in certain cases, experts said.

— Greg Iacurci

An Iranian Revolutionary Guard commander said the Strait of Hormuz is closed, Reuters reported, citing Iranian media.

Iran vowed to set any ship trying to pass through the strait on fire, the outlet reported.

— Dan Mangan

Trump had a visible rash on the right side of his neck during a public appearance at the White House, where he gave an update about the war against Iran.

"President Trump is using a very common cream on the right side of his neck, which is a preventative skin treatment, prescribed by the White House Doctor," Trump's physician, Dr. Sean Barbabella, said in a statement sent to CNBC by the White House.

"The President is using this treatment for one week, and the redness is expected to last for a few weeks," Barbabella said.

Trump, since last year, has been seen on multiple occasions with bruising or makeup on his right hand. The White House has attributed the bruising to the amount of handshaking the president engages in, and his use of aspirin.

— Dan Mangan

The U.S. State Department posted on X about steps Americans should take in the Middle East, directing those needing consular assistance to call +1-202-501-4444 from overseas or +1-888-407-4747 from the U.S. and Canada.

In a video post, Secretary of State Marco Rubio also spoke directly to "Americans in the Middle East" about the work the State Department was doing to try to keep them safe.

— Riya Bhattacharjee

JPMorgan Chase CEO Jamie Dimon warned that he expects a rise in cyber or terrorist attacks globally after the U.S. and Israel attacked Iran over the weekend.

When asked by CNBC's Leslie Picker about geopolitical risks caused by the conflict, Dimon said he believed the odds of a "long, just peace" in the region were higher as a result of the campaign.

"The most important thing is that we keep the Western world free and safe for democracy," Dimon said. "People like this have gotten away literally with murder for 50 years, that's far more important."

"But… as a corollary to that, you've got to expect there'll be cyberattacks or terrorist attacks, either here or around the world," Dimon said. "Banks may be targets."

The impact on markets and inflation is likely to be limited unless the campaign is "prolonged," he said

—Hugh Son

Emirates' first departure from Dubai since the U.S. and Israel attacked Iran last week took off late Monday, bound for Mumbai, India, a sign that flight cancellations that have topped 11,000 to and from the region since Saturday could soon start to ease.

Other flights are scheduled for late Monday after local authorities gave the Dubai-based carrier the green light for "limited" operations. The first flight was operated with an Airbus A380, the largest passenger plane in the world.

Separately, Israeli airline El Al said it was considering hiring private jets to bring some Israelis home from Europe via Jordan.

— Leslie Josephs

The daily rate for very large crude carriers, or VLCCs, was already up sharply year to date, and the war against Iran will likely increase rates even more as marine traffic comes to a halt around the Strait of Hormuz.

The time charter equivalent — essentially daily revenue — for VLCCs soared to $177,469 last week from $37,869 at the start of the year, according to data from the Baltic Exchange.

The increase is due to a tight supply of VLCC vessels, driven by higher oil exports from the Middle East at the beginning of the year and rising geopolitical tensions. A rise in shipping costs tends to eventually trickle through to consumers, boosting the price at the pump and for petroleum-based products, including plastics.

"Even without significant further disruptions in the Strait, precautionary restocking and redirection can raise already elevated freight rates further," Goldman Sachs wrote in a note to clients on Sunday.

— Pippa Stevens and Gabriel Cortes

Investors are on edge following the U.S. and Israel's attack on Iran. CNBC's Michael Santoli examines market reactions as investors weigh regional uncertainty and breaks down how similar outbreaks have moved prices in the past.

— Michael Santoli, Kaan Oguz, Lauren Hans, Lindsey Jacobson

The U.S.-Israel conflict with Iran could disrupt crude oil supplies and push prices for gasoline higher.

Already, U.S. crude prices gained 6% and U.S. gasoline futures surged by as much as 9.1% to $2.496 a gallon Monday, their highest since July 2024. 

It takes six weeks for crude oil to be processed and turned into gasoline for delivery, so the full impact may be somewhat delayed, according to Amy Myers Jaffe, director of the Energy, Climate Justice and Sustainability Lab at New York University.

However, with supply now constrained, consumers are likely to see some immediate price changes at the pump.

If the price of oil goes up by $10 a barrel, the price of gasoline could rise by about 25 cents a gallon, according to Ken Medlock, senior director at the Center for Energy Studies at Rice University's Baker Institute.

Within a week, "everyone is going to be paying a little more than they are right now," he said.

— Jessica Dickler

Secretary of State Marco Rubio will brief congressional leaders on the war in Iran on Monday afternoon.

The briefing comes as the Senate returns today and the House will reconvene on Tuesday. Democrats in both chambers have vowed to force votes on war powers resolutions that could limit President Donald Trump's authority to carry out further attacks on Iran.

Rubio will meet with the Gang of Eight, a group that includes leaders from both parties in the House and Senate, as well as the chairs and ranking members of the Senate and House intelligence committees. On Tuesday, Secretary of Defense Pete Hegseth, CIA Director John Ratcliffe and Chairman of the Joint Chiefs of Staff Gen. Dan Caine will hold an all-Congress briefing, the White House confirmed on Monday. White House spokesman Dylan Johnson said bipartisan staff on relevant national security committees were briefed on Sunday.

—Justin Papp

Amazon warned customers in the Middle East of longer delivery times as regional instability tied to the war in Iran disrupted operations.

The company added a notice to the top of its marketplaces in Israel, Saudi Arabia, Kuwait and Bahrain that reads: "Extended delivery time in your area."

Amazon added a similar advisory to its website in the United Arab Emirates.

"As we prioritize safety, some services may be temporarily unavailable in this area and delivery times may be impacted," the notice stated: "Thank you for your patience and understanding."

Amazon operates warehouses and cloud data centers throughout parts of the Middle East. It also has corporate offices in Dubai, Saudi Arabia and Israel.

Amazon data centers in the UAE and Bahrain were experiencing prolonged power outages on Monday amid the conflict.

— Annie Palmer

Trump said the U.S. expected "from the beginning" that its military intervention in Iran would last four to five weeks, but stressed that "we have capability to go far longer than that."

"We're already substantially ahead of our time projections. But whatever the time is, [it's] OK, whatever it takes," Trump said at the White House.

"We have the strongest and most powerful, by far, military in the world, and we will easily prevail," he said in the East Room before a Medal of Honor award ceremony.

Trump also laid out the U.S. objectives for the war, more than two days after the fighting began.

Critics have charged that the justifications for the military action have been shifting or opaque. But Trump asserted Monday, "Our objectives are clear."

The U.S., said Trump, aims to destroy Iran's missile capabilities; annihilate its naval assets; prevent Tehran from ever obtaining nuclear weapons; and ensure that the regime cannot support foreign terrorism.

— Kevin Breuninger

U.S. Central Command in an X post called out the Iranian regime for misinformation about the purported sinking of an American aircraft carrier.

"The Iranian regime's false messaging machine continues to falsely claim that it has sunk a U.S. aircraft carrier," Centcom said in the post.

"The TRUTH: The only carrier that has been hit is the Shahid Bagheri, an Iranian drone carrier. U.S. forces struck the ship within hours of launching Operation Epic Fury," the post said.

— Dan Mangan

Trump claimed that the military campaign he launched against Iran "was our last, best chance to strike" in order to "eliminate the intolerable threats posed by this sick and sinister regime."

Iran had ignored U.S. warnings to abandon efforts to rebuild after the U.S. struck its nuclear infrastructure last year, Trump said at the White House.

Tehran was also quickly growing a ballistic missile program that would act to "shield their nuclear weapon development," the president said.

This "posed a very clear colossal threat to America and our forces stationed overseas," Trump said.

Trump made that assertion after criticizing the 2015 Iran nuclear deal, which was finalized under former President Barack Obama and aimed to limit Tehran from developing its nuclear program.

The U.S. withdrew from that deal in 2018 during Trump's first presidential term.

"I was very proud to have knocked out the Iran nuclear deal by President Barack Hussein Obama. That was a horrible, horrible, dangerous document. They would have had nuclear weapons three years ago, and they would have used them," Trump said.

— Kevin Breuninger

Aon, a global insurance broker, says marine war risk underwriters have reacted swiftly to the heightened geopolitical risk environment in the Middle East.

The primary actions the company is observing include:

• Issuance of formal notices of cancellation under standard seven-day war clauses on certain annual hull war policies.
• Reinstatement of cover offered at materially increased rates.
• Withdrawal or revision of existing quoted additional premiums for transits through listed high-risk areas.
• Heightened underwriting scrutiny for trips into or near sensitive zones.

Stephen Rudman, Aon's head of marine, Asia, says that "importantly, this activity relates specifically to war risk extensions. Core hull and machinery and P&I covers remain in place unless otherwise advised."

"Additional premiums for vessels transiting high-risk waters are rising sharply and may continue to fluctuate in the short term. Cargo war risk remains available; however, rates are increasing and quotations are being reviewed on a voyage-by-voyage basis, particularly for energy and bulk commodity trades," Rudman told CNBC in emailed comments.

Aon is not seeing a systemic withdrawal of capacity. Instead, the broker believes the market is repricing to reflect the elevated risk profile and reinsurance constraints.

"Should the situation escalate materially, for example, sustained state conflict or significant vessel loss, further rate correction is likely," Rudman noted.

— Dawn Giel

Prediction markets are facing renewed scrutiny from federal lawmakers after wagers about the fate of Iranian leader Ayatollah Ali Khamenei, who was killed in the Saturday bombardment of Iran.

"It's insane this is legal," Sen. Chris Murphy, D-Conn., said in a post on X, referring to another post highlighting people who had made money on the invasion. "People around Trump are profiting off war and death. I'm introducing legislation ASAP to ban this."

Prediction market Kalshi, in a comment to CNBC, said it "doesn't allow markets directly tied to death," regarding betting lines over whether Khamenei would be out of power that have received criticism. The company issued refunds on the market, citing regulations barring wagers on death.

"We included every precaution on this market to make sure people could not trade on the outcome of death," the company said. "Our rules were clear from the beginning, we never changed them, and we settled based on the rules. We reimbursed all fees and net losses because we thought the UX could have been clearer for users."

NPR reported that on Polymarket, another prediction market that is not yet operational in the U.S., a user under the name "Magamyman" cashed in for more than $553,000.

Read the whole story here.

Disclosure: CNBC and Kalshi have a commercial relationship that includes customer acquisition and a minority investment.

— Garrett Downs

The Iran war could quickly be a key issue for both Democrats and Republicans with midterm primaries kicking off this week.

Durham County Commissioner Nida Allam, who is trying to knock off incumbent Rep. Valerie Foushee Tuesday in a Democratic primary in North Carolina's 4th Congressional District, released a campaign video Monday morning condemning the war in Iran and criticizing Foushee for accepting money from defense contractors.

"I will never take a dime from defense contractors, or the pro-Israel lobby," Allam says in the video.

Foushee has also condemned the war and said she would support a war powers resolution to limit Trump's military activity in Iran. The U.S. House is expected to take that measure up this week, but even if it passes Congress, Trump would be highly unlikely to sign it into law.

— Justin Papp

Trump is set to make his first live public comments on Iran since the war started, a White House official confirmed.

The president was expected to discuss Iran at a Medal of Honor ceremony at the White House.

— Dan Mangan

U.K. Prime Minister Keir Starmer has defended his decision to delay accepting a U.S. request to use military bases for strikes on Iranian missile sites.

In a speech to lawmakers in the House of Commons, Starmer said that the use of British military bases is limited to "agreed defensive purposes," adding that Britain would not be joining the U.S. and Israeli "offensive" strikes against Iran.

His comments follow criticism from Trump, who reportedly accused Starmer of taking "far too long" to accept a U.S. request to use military bases for "defensive" strikes on Iranian missile sites.

"We will continue our defensive actions in the region," Starmer said Monday.

— Sam Meredith

Trump said the U.S. military will soon ramp up its offensive in Iran.

"We haven't even started hitting them hard," Trump told CNN's Jake Tapper in a phone call, the news anchor said Monday morning.

"The big wave hasn't even happened. The big one is coming soon," Trump said, according to Tapper, who spoke on air right after the nine-minute call.

The remark followed Trump urging Iran's citizens — whom he has encouraged to take over the country's government — to stay inside because "it's not safe out there," Tapper said.

The president said that the operations are so far "going very well."

"We're knocking the crap out of them," Tapper said Trump told him.

Asked about how long the conflict might last, Trump told the CNN anchor, "I don't want to see it go on too long. I always thought it would be four weeks, and we're a little ahead of schedule."

Defense Secretary Pete Hegseth told reporters at the Pentagon earlier Monday that the war's timeline could shift longer or shorter than the four-week estimate Trump has previously floated.

— Kevin Breuninger

The U.S. is poised to send additional forces to the Middle East today, military leaders said, while suggesting that the war could continue longer than the four- to five-week timeline that Trump floated a day earlier.

In preparation for possible armed conflict against Iran, the U.S. in recent weeks had preemptively deployed thousands of service members from all military branches, along with dozens of refueling tankers and multiple carrier strike groups, while establishing necessary supply flows, Joint Chiefs of Staff Chairman Gen. Dan Caine said at the Pentagon.

"And the flow of forces continues today. In fact, [Commander of U.S. Central Command Adm. Brad] Cooper will receive additional forces even today," Caine said.

Asked how many troops are currently involved and how many are expected to be sent, Caine declined to be specific.

But he said "more tactical aviation" is entering the theater, and added, "I think we're just about where we want to be in terms of total combat capacity and total combat power."

Hegseth then responded to a question about Trump's remark Sunday that the operations could last around four weeks.

"It's the typical, typical NBC sort of gotcha-type question," Hegseth said.

"President Trump has all the latitude in the world to talk about how long it may or may not take. Four weeks, two weeks, six weeks. It could move up. It could move back. We're going to execute at his command the objectives we've set out to achieve," Hegseth said.

— Kevin Breuninger

Stocks started the week off with losses after the U.S. and Israel attacked Iran over the weekend.

The Dow Jones Industrial Average dropped 543 points, or 1.1%. The S&P 500 lost 1.1%, and the Nasdaq Composite futures declined 1.6%.

— Sean Conlon

Airlines have canceled thousands of flights for the week in the Middle East.

The cancellations continued Monday, with 1,560 flights scrubbed, or 41.28% of those scheduled for arrival in Middle East countries, according to aviation data firm Cirium.

Hundreds of thousands of passengers remain stranded.

The United Arab Emirates had the most flight cancellations in the region, with 774, according to Cirium. Dubai International Airport in the UAE is one of the busiest airport hubs in the world.

The airport authority that owns and manages airports in Dubai said a small number of flights would be permitted to operate from Dubai International and Dubai World Central – Al Maktoum International, but advised travelers to check with their airlines.

Airspace remains closed in many Middle Eastern countries. Cirium noted that some smaller airlines have not updated their schedules to officially cancel flights or have simply not flown the flights.

— Michele Luhn

New Norwegian Cruise Line CEO John Chidsey said the company is closely monitoring fuel costs as crude oil prices jump.

"As for fuel prices, the longer-term impact remains uncertain," he said on an earnings call Monday. "However, we are currently approximately 51% hedge for 2026, 27% hedge for 2027, which helps mitigate near-term volatility."

Chidsey said the company does not currently have cruises operating in the affected areas but will be monitoring the situation closely.

— Contessa Brewer and Michele Luhn

As transit through the Strait of Hormuz comes to a standstill, oil is stuck on vessels that can't exit the Persian Gulf.

Approximately 77 million barrels of oil have been loaded onto tankers currently sitting in the Persian Gulf, according to Kpler data. The oil waiting to transit is at its highest level in six years, and there are an additional 88 million barrels of capacity on vessels still in the region.

Together, it represents about 10 days' worth of shipments, the firm said, meaning there's a "finite buffer before the halt in vessel movements severely bottlenecks global exports."

Brent crude, the international oil benchmark, last traded at $79.22 per barrel, up 8.7%.

— Pippa Stevens

Air Force Gen. Dan Caine, chairman of the Joint Chiefs of Staff, said the U.S. expects to sustain more military casualties as the widespread fighting in the Middle East continues.

"This is not a single overnight operation," Caine said at the Pentagon.

"The military objectives that [U.S. Central Command] and the Joint Force have been tasked with will take some time to achieve, and in some cases, will be difficult and gritty work," he said.

"We expect to take additional losses and, as always, we will work to minimize U.S. losses."

Defense Secretary Pete Hegseth gave a similar warning: "An effort of this scope will include casualties. War is hell."

— Kevin Breuninger

U.S. Defense Secretary Pete Hegseth said that the war in Iran is not being waged in order to overthrow Tehran's ruling regime — but he pointed to the deaths of Iranian leaders that have resulted from the operations so far.

"Turns out the regime who chanted 'Death to America' and 'Death to Israel' was gifted death from America and death from Israel," Hegseth said during a press briefing at the Pentagon.

"This is not a so-called regime-change war, but the regime sure did change, and the world is better off for it," Hegseth said.

The "clear" mission of the U.S. campaign dubbed "Operation Epic Fury," he said, is to destroy Iranian military threats and nuclear capabilities.

"Israel has clear missions as well, for which we are grateful," Hegseth said.

— Kevin Breuninger

The Strait of Hormuz isn't only vital for oil — it's a key waterway for refined products, too, and prices are outpacing the gains in crude. While oil jumped about 9% on Monday morning, European diesel prices surged 20%.

Tanker traffic through the narrow waterway has come to a standstill, while Saudi Arabia's Ras Tanura — a key refinery in the region — was hit by a drone.

Heating oil futures in the U.S., which are a proxy for diesel prices, jumped 14.5% on Monday morning. The fuel is often referred to as the workhorse of the economy, given that it powers trucks and trains.

— Pippa Stevens

Four U.S. service members have now died as part of the military conflict in Iran and the Middle East, U.S. Central Command said Monday morning.

The latest fallen service member succumbed to their injuries after being "seriously wounded during Iran's initial attacks," Central Command said in a post on X.

"Major combat operations continue and our response effort is ongoing. The identities of the fallen are being withheld until 24 hours after next of kin notification," it said.

— Kevin Breuninger

Senior U.S. military officials are set to brief reporters at the Pentagon about the latest developments on their military operations in the Middle East.

Defense Secretary Pete Hegseth and Chairman of the Joint Chiefs of Staff Gen. Dan Caine will lead the briefing, which is set to begin at 8 a.m. ET.

— Kevin Breuninger

FedEx warned customers that shipments could be delayed after it suspended flights at major airports in the Middle East. The shipping giant operates a hub in Dubai and, in February 2024, it announced a $350 million investment in a facility there.

Pickups and deliveries in Bahrain, Kuwait, Iraq, Qatar and United Arab Emirates "have been temporarily suspended until further notice," FedEx said, warning that other markets in the area could experience delays.

"We are closely monitoring the situation and will resume services as soon as it is safe to do so," FedEx said.

— Leslie Josephs

QatarEnergy announced in a statement seen by CNBC that it has "ceased production of liquefied natural gas" and "associated products," citing military attacks on the company's operating facilities in Ras Laffan Industrial City and Mesaieed Industrial City in the state of Qatar.

QatarEnergy is one of the world's largest LNG producers, with a total production capacity of 77 million metric ​tons per annum.

Qatar has been targeted by Iranian counterstrikes on its capital Doha, its airport, and other civilian and state infrastructure.

— Emma Graham

Officials from Russia and China's Foreign Ministries have condemned the U.S.-led strikes but have stopped short of pledging military or civilian support to Tehran. That exposes the hard limits of Iran's "strategic partnerships" with Moscow and Beijing, experts say.

Read more on the story here: Why Iran should not count on allies Russia and China to come to its aid

— Holly Ellyatt

Container shipping giants have been forced to issue fresh guidance for vessels transiting maritime corridors in the Middle East, including the strategically vital Strait of Hormuz.

The waterway, which is located between Oman and Iran and connects the Persian Gulf with the Arabian Sea, is considered one of the most important arteries for global trade.

Danish shipping company Maersk and German container shipping firm Hapag-Lloyd both said over the weekend that they would suspend all vessel crossings in the Strait of Hormuz until further notice, amid the deteriorating security situation.

Peter Sand, chief analyst at Xeneta, told CNBC on Monday that higher container shipping rates should be factored in for the Middle East region at least for as long as the conflict persists, adding there is "no real alternative" to ocean freight.

— Sam Meredith

Three U.S. F-15 fighter jets crashed over Kuwait in what looks to be a friendly fire incident, U.S. Central Command said Monday. None of the aircrew were hurt.

"During active combat — that included attacks from Iranian aircraft, ballistic missiles, and drones — the U.S. Air Force fighter jets were mistakenly shot down by Kuwaiti air defenses," Centcom said in a statement.

"All six aircrew ejected safely, have been safely recovered, and are in stable condition. Kuwait has acknowledged this incident, and we are grateful for the efforts of the Kuwaiti defense forces and their support in this ongoing operation."

The cause of the incident is under investigation and additional information will be released as it becomes available, Centcom said.

— Azhar Sukri

"When and how will this end?" is the question everyone is asking as the Middle East crisis gathers pace with no clear end in sight, Carl Bildt, former prime minister of Sweden and the co-chair of the European Council on Foreign Relations, told CNBC on Monday.

"The end of this particular conflict, if there is such a thing, will, of course, shape both Iran and the region for years to come. Key question is, will the regime survive or will it collapse?" Bildt told CNBC's "Squawk Box Europe."

"If [the Iranian regime] survives, in what particular form and what particular shape, and if it collapses, is that a collapse into chaos, or is that collapse into a transition to something that is somewhat more stable?" he said.

The collapse of a regime overseeing a country of 90 million people would have "profound implications for the stability of the entire region" Bildt said. "So it is a watershed event in the history of the region, with a highly uncertain outcome."

Bildt called the U.S.' decision to strike Iran a "war of choice" rather than necessity, and one which was borne out of pressure from Israel and sensing a weakened Iranian regime amid ongoing protests. He said Iran's decision to strike back at targets across the Middle East, and beyond U.S. bases, was "surprising, but also highly disturbing."

— Holly Ellyatt

Emirates and Etihad have temporarily halted all flights into and out of their hubs in the United Arab Emirates on Monday.

"Due to multiple regional airspace closures, Emirates has temporarily suspended all operations to and from Dubai, up until 1500hrs UAE time on Tuesday, 3 March," Emirates said in an advisory on its website.

"The situation remains dynamic and is assessed continuously. We urge all customers to review the latest operational updates on emirates.com and check their email for any notifications about changes or cancellations to their flights before travelling to the airport," Emirates said.

The UAE's other major carrier, Etihad Airways, also said it was suspending flights.

"Regional airspace closures continue to impact Etihad Airways' operations, and all flights to and from Abu Dhabi are suspended until 14:00 UAE time on Tuesday 3 March," Etihad said on its website.

Meanwhile, Jordan announced a partial and temporary closure of its airspace.

— Azhar Sukri and Emma Graham

Amrita Sen, founder of Energy Aspects, told CNBC's "Europe Early Edition" this morning that oil markets are likely to hold at around $80 a barrel for now after an initial spike, noting, "we've kind of stabilized a little bit," and adding, "I do think we will hold around that 80 level for some time right now," as there has been no direct hit to core Gulf energy infrastructure.

The bigger concern is the Strait of Hormuz. Sen said Energy Aspects calculates that "about 15 million barrels" per day of oil and "about 80 million tonnes of LNG" passed through the strait last year. While she does not expect Iran to formally shut the waterway, she warned that "what the U.S. will not be able to do is control these one-off attacks on tankers."

Those incidents are "enough to kind of make the market extremely cautious about sending vessels in," creating delays and disruption.

Sen said prices would likely stay near current levels unless there is "actual damage to energy infrastructure." Without that, she said, the market holds steady — but "further damage and yes, we go up."

— Spriha Srivastava

Ayatollah Ali Khamenei's death following joint U.S.-Israeli airstrikes has thrust Iran's leadership into the urgent process of selecting a new supreme leader.

Under Iran's constitution, the supreme leader is appointed by the Assembly of Experts. When the position becomes vacant, the assembly convenes to deliberate and select a successor. The decision requires a simple majority vote.

In the interim, a provisional three-member leadership council assumes the supreme leader's duties until a replacement is formally appointed.

On Sunday, local media reported that the temporary council comprises President Masoud Pezeshkian, Judiciary Chief Gholam-Hossein Mohseni-Ejei and Ayatollah Alireza Arafi, who serves as the Guardian Council's representative.

On Polymarket, traders are pricing Mohseni-Ejei as the narrow front-runner at roughly 18%. Other top contenders include Arafi and Iranian cleric Hassan Khomeini.

Read the full story here.

— Lee Ying Shan

Saudi Aramco's Ras Tanura refinery has been hit by a drone, an industry source has told CNBC.

The facility had been closed as a precaution amid the ongoing conflict in the region.

The source says a small fire has been contained and is under control.

Saudi Aramco did not immediately respond to an emailed request for comment.

— Emma Graham

European stocks are expected to start the new trading week firmly in negative territory as global markets drop after the U.S. and Israel launched widespread attacks on Iran at the weekend.

The U.K.'s FTSE index is seen opening 0.6% lower, Germany's DAX down 1.5%, France's CAC 40 down 1.4% and Italy's FTSE MIB 1.2% lower, according to data from IG. Read more.

— Holly Ellyatt

Amazon Web Services said Sunday it was working to fix a disruption it suffered in the United Arab Emirates after unidentified "objects" struck one of its data centers, sparking a fire and leading to a power cut.

It comes as the UAE is being targeted by Iran's retaliatory missile and drone strikes following U.S. and Israeli attacks on the country over the weekend.

AWS said on its health dashboard that the issue had led to some ongoing connectivity disruptions, but customers were able to reroute to unaffected zones.

In its latest update, AWS said it still did not have an estimated time for power restoration. "We are investigating additional connectivity issues and error rates in the ME-CENTRAL-1 Region [UAE]," the company said.

— Dylan Butts

Loud blasts were heard for a third day in Dubai and Abu Dhabi. CNBC's team in the United Arab Emirates said the explosions occurred shortly after 9 a.m local time.

The UAE's Ministry of Defence said in a post on X that the country's air force and air defence units had intercepted "165 ballistic missiles, two cruise missiles and 541 Iranian drones since the start of the Iranian attack."

Among the locations targeted were Dubai's iconic Burj Al Arab hotel, the Fairmont Hotel on the Palm, Jebel Ali Port, Abu Dhabi's Etihad Towers and the international airports in the two emirates.

— Emma Graham

Iran's security chief Ali Larijani said that Tehran has no plans to engage in negotiations with the United States.

"We will not negotiate with the United States," the former adviser to the late supreme leader said in a post on X, dismissing reports that it is seeking to restart negotiations with Washington.

"Trump has plunged the region into chaos with his 'false hopes' and is now worried about further casualties of American troops," he wrote in an earlier post.

— Lee Ying Shan

Kuwait's Director General of Civil Defense said Monday that the country's Air Defense forces had successfully intercepted a majority of hostile Iranian drones approaching its borders through maritime routes.

The Kuwaiti official also confirmed that no injuries were reported from the interception operations, according to a report by state-backed media.

According to the Gulf Cooperation Council, Iran unleashed waves of drones and missiles on several Arab nations, including Kuwait, the United Arab Emirates, Bahrain, Saudi Arabia, Oman, and Qatar, over the weekend.

Since then, countries like Bahrain and the UAE have reported successful interceptions of hundreds of Iranian drones.

According to Bahrian officials, the attacks have included Iran's Shahed-136 type drones, a cheap, locally made drone that can act like a guided missiles that travel to a predetermined target.

— Dylan Butts

The United Arab Emirates recalled its ambassador from Iran Monday and shuttered its embassy in Tehran in response to missile strikes over the weekend that it said targeted civilian infrastructure, including Jebel Ali Port and airports in Dubai and Abu Dhabi.

The UAE Ministry of Foreign Affairs also summoned the Iranian Ambassador and delivered a note of protest over what it described as "terrorist attacks."

Abu Dhabi downgraded ties with Tehran in 2016 after attacks on Saudi diplomatic missions in Iran. Relations deteriorated further after the UAE joined the Abraham Accords in 2020.

In recent years, however, ties had begun to improve. The UAE's national security advisor, Sheikh Tahnoon bin Zayed al Nahyan, visited Tehran in 2021, in a rare move aimed at warming ties.

About half a million Iranians are estimated to live in the Emirates, many of them in Dubai. The Emirate is home to an Iranian hospital, at least one Shiite mosque in Jumeirah and numerous businesses selling Iranian goods. Despite periodic diplomatic strains, the two countries have maintained significant trading ties. Iran and the UAE are also at odds over three contested islands in the Persian Gulf.

Saudi Arabia, which recently restored diplomatic relations with Iran in 2023 under a deal brokered by China, also condemned the attacks on the Gulf States and summoned its ambassador from Tehran.

— Emma Graham

A group of Middle Eastern countries and the U.S. issued a joint statement Sunday night stateside, condemning Iran's missile and drone attacks and affirming their right to self-defense.

"The Islamic Republic's actions represent a dangerous escalation that violates the sovereignty of multiple states and threatens regional stability. The targeting of civilians and of countries not engaged in hostilities is reckless and destabilizing behavior," according to the statement.

"We stand united in defense of our citizens, sovereignty, and territory, and reaffirm our right to self-defense in the face of these attacks. We remain committed to regional security and commend the effective air and missile defense cooperation that has prevented far greater loss of life and destruction."

— Anniek Bao

U.S. Secretary of State Marco Rubio is scheduled to update top leaders of the Senate and House at 4 p.m. ET on Monday.

This comes on the back of coordinated strikes by the United States and Israel on Iran, and Tehran's retaliation that has seen it target U.S. bases in the region, including those in the UAE and Saudi Arabia.

— Lee Ying Shan

Israel Defense Forces said they were retaliating against Lebanon-based militant group Hezbollah for targeting Israeli civilians.

"In response to projectile fire toward northern Israel, the IDF is striking Hezbollah targets across Lebanon," the IDF said in statement posted on X.

"Hezbollah is operating on behalf of the Iranian regime, opening fire against the Israeli civilians, and bringing ruin to Lebanon. IDF troops have prepared for such a scenario as part of Operation 'Roaring Lion', and are prepared for an all-fronts scenario," the statement read.

The IDF in 2024 killed Hezbollah's leader Hassan Nasrallah, who had led the Iran-backed militant group for more than three decades.

— Vinay Dwivedi

The U.K. has granted permission for the U.S. to use its military bases in the Middle East in an effort to destroy Iranian missiles and missile launchers, Prime Minister Keir Starmer said in an address on Sunday posted to X.

Starmer framed his decision as one of self-defense.

The move follows Iranian strikes across the region that have put British interests, citizens and allies in harm's way, despite the U.K. not having been involved in the initial U.S. and Israeli attacks on Iran, the prime minister said.

"We all remember the mistakes of Iraq, and we have learned those lessons," Starmer said. "We were not involved in the initial strikes on Iran, and we will not join offensive action now."

"But Iran is pursuing a scorched earth strategy," he added. "So we are supporting the collective self defense of our allies and our people in the region. Because that is our duty to the British people. It is the best way to eliminate the urgent threat and prevent the situation spiraling further."

Against this backdrop, the U.K.'s decision to allow the U.S. to use its bases is consistent with international law, he said.

— Greg Iacurci