U.S. Central Command announced on Tuesday that it had defeated multiple Iranian ballistic missiles and drones, launching defensive strikes in response to what it described as “attempted attacks” by Iran.
The exchange marks the latest escalation in a cycle of violence that has continued to threaten a fragile ceasefire between the two countries, now three months into a regional conflict.
Iran fired several ballistic missiles toward regional neighbours, though none reached their intended targets, according to a CENTCOM statement released Tuesday.
Two Iranian missiles aimed at Kuwait fell short or broke apart before arrival, while three missiles launched toward Bahrain were intercepted by U.S. and Bahraini air defence forces.
American forces also shot down three one-way attack drones that Iran had launched toward civilian mariners transiting regional waters.
U.S. forces additionally conducted self-defence strikes on an Iranian military ground control station located on Qeshm Island.
Iran’s Revolutionary Guard Corps attacked the U.S. Fifth Fleet headquarters, an airbase, and helicopters in the region using missiles and drones, Reuters reported, citing Iranian media.
The IRGC said its actions were in response to what it described as a U.S. attack on a communications tower south of Qeshm Island.
The IRGC’s navy also targeted a vessel it identified as Panaya with missiles, saying the strike was retaliation for what it claimed was a U.S. attack on an Iranian tanker near the Strait of Hormuz that damaged the vessel’s engine room.
Governments across the Gulf reported drone attacks on Wednesday, with Kuwait’s air defences confronting what the country described as “hostile missile and drone attacks,” urging citizens to follow security instructions.
Bahrain’s interior ministry sounded warning sirens on Wednesday, directing residents to seek shelter as the regional situation continued to deteriorate.
Iran is reportedly reviewing a peace proposal put forward by the Trump administration to pause the war, but has not communicated with Washington for several days, according to Iranian media.
U.S. President Donald Trump, however, insisted that negotiations between the two sides were still ongoing.
Asian markets traded higher on Wednesday, tracking gains on Wall Street, with Japan’s Nikkei 225 hitting a record high, suggesting investors have so far looked past the mounting geopolitical uncertainty.
“It’s hard to gauge when [the conflict and negotiations] may finally come to an end,” said Rick Gardner, chief investment officer at RGA Investments, speaking on CNBC’s Squawk Box Asia on Wednesday.
Gardner expects markets to oscillate between conflict-driven negative shocks and resilient corporate earnings, describing the situation as a “two-edged sword.”
He warned that investors who exit markets due to geopolitical concern risk being “on the wrong side of the trade,” pointing to strong earnings and forward guidance as reasons to remain invested.