By Osmond Chia and Peter Hoskins u2014 BBC Business
Oil prices started climbing again after US President Donald Trump reiterated threats to hit Iran u201cextremely hardu201d in the coming weeks and failed to give concrete details on how the war will end.
Brent crude briefly surged past $109 (u00a382) a barrel and stock markets in the US, Europe and Asia fell following Trumpu2019s address from the White House.
He said that the US would complete its strategic objectives for the war u201cvery shortlyu201d and spend the next two to three weeks bombing Iran u201cback to the Stone Agesu201d.
Earlier on Wednesday, oil prices dipped below $100 ahead of the speech on hopes Trump would say how the US would exit the conflict but his address repeated the same points he made previously.
The Iran war has severely disrupted global oil and gas supplies. Oil shipments through the critical Strait of Hormuz waterway have mostly been halted after Iran threatened to attack tankers that try to cross in retaliation to US-Israeli strikes, which began on 28 February.
In his speech, Trump said the US did not need the Middle Eastu2019s energy and urged other nations to step in to free up shipments from the Gulf that have been disrupted as a result of the war.
He said: u201cTo those countries that canu2019t get fuel, many of which refuse to get involved in the decapitation of Iranu2026 build up some delayed courage, go to the Strait and just take it.u201d
Oil prices, which had been fluctuating incrementally before, shot upwards moments after the televised speech. Brent crude, the global benchmark, rose more than 8% on Thursday, before retreating a bit.
The US benchmark, West Texas Intermediate, which had been somewhat shielded from the price rises earlier in the conflict compared with Brent, also took off, briefly trading above $110 a barrel in Thursday morning trade in New York before dropping back a bit.
The rise was a u201cclear market reality check following the earlier optimism for an imminent ceasefireu201d said Alberto Bellorin, founder and managing director at InterCapital Energy, an oil and gas consultancy.
Trumpu2019s speech lacked a u201cconcrete timelineu201d for the reopening of the Strait of Hormuz, while a return to normal now looks u201cmonths away rather than weeks,u201d he added. In urging other nations to step in, Trump has removed hopes that disruptions to global energy supplies will be resolved swiftly, Bellorin said.
In his speech, Trump said oil and gas flows would return quickly when the war ended. u201cWhen this conflict is over, the strait will open up naturally. It will just open up naturally,u201d he said.
But Anne-Sophie Corbeau, former head of gas analysis at oil giant BP, suggested it could take some time for flows to return to normal. The Gulfu2019s energy infrastructure has been damaged following strikes by Iran, Israel and the US and Corbeau said repairing it could take between three and five years.
Corbeau, who is now at the Center on Global Energy Policy at Columbia, told the BBCu2019s Today programme that disruption to traffic through the Strait of Hormuz was likely to persist and that additional costs in the form of fees to use the strait could be u201cquite substantialu201d.
She said currently she understood ships were subject to a charge in the region of $2m for using the strait, which, if made permanent amounted to u201cthe worst-case solutionu201d for users of the waterway.
In the US, the Dow Jones Industrial Average, the S&P 500 and Nasdaq were all more than 1% lower in early morning trade. In the UK, the FTSE 100 index fell in early afternoon trade but closed 0.69% higher. Franceu2019s Cac index closed down 0.24%, and Germanyu2019s Dax closed down 0.79%u2014both regaining some earlier falls.
In Asia, major stock indexes fell after Trumpu2019s address, reversing earlier gains. Japanu2019s Nikkei 225 closed down 2.4% and South Koreau2019s Kospi ended 4.5% lower.
The regionu2019s stock markets have been volatile since the Iran war began. Asia is particularly vulnerable to the impact of the conflict as it is heavily reliant on the Middle East for its energy supplies.