Gulf states report fresh air strikes

Millions spend night in bomb shelters

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Rockets are seen over Netanya, Israel, as Iran ramps up its missile attacks yesterday. A photograph shows a building damaged by a drone strike in Manama, Bahrain on Tuesday.

(PHOTOS BY AFP)

The US and Israel traded air strikes with Iran's military across the Middle East as the besieged Tehran government warned its state security forces were ready with "fingers on the trigger" to confront any revival of anti-government protests.

Following an exchange of some of the heaviest bombardments in the region yet on Tuesday, the combatants renewed their attacks on opposing targets in Israel, Lebanon and the Gulf early yesterday as the war stretched into its 12th day.

The conflict has effectively blocked vital shipping lanes through the Strait of Hormuz, halting the flow of one-fifth of the world's fossil energy supplies from the petroleum-rich Gulf.

But after a major surge in crude oil prices on Monday, global energy prices have tumbled and stock markets rebounded as investors bet that US President Donald Trump would seek to end the war soon.

Adding to market optimism, the International Energy Agency has proposed the largest release of oil reserves in its history to further stabilise crude prices, the Wall Street Journal reported on Tuesday, citing officials familiar with the matter. Reuters could not immediately verify the report.