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Israeli Prime Minister Benjamin Netanyahu said joint US-Israel strikes had destroyed Iran’s ability to enrich uranium and to produce ballistic missiles, and that he saw “this war ending a lot faster than people think”.
Netanyahu rejected the notion of an open-ended military campaign against Iran, telling a press conference on Thursday evening that the objectives he had set were achievable.
He said he had agreed, at the request of US President Donald Trump, not to launch further Israeli attacks on Iran’s giant South Pars gasfield. He also said Israel was helping the US with efforts to reopen the Strait of Hormuz, the strategic waterway which Iran has in effect closed through attacks on shipping.
Brent crude retreated to below $108 a barrel after Netanyahu’s comments. The oil benchmark topped $119 earlier on Thursday after Iranian missiles hit Gulf energy infrastructure in retaliation for the Israeli attack on South Pars.
US stocks pared earlier losses and Treasuries rallied. Wall Street’s S&P 500 closed 0.3 per cent lower. Yields on two-year Treasuries, which had earlier surged as high as 3.96 per cent, fell to 3.79 per cent.
Netanyahu used his press conference to claim achievements in the US-Israel campaign against the Iranian regime, which he said was showing signs of “cracking”.
He singled out attacks on Iran’s defence industrial base, for the first time saying Tehran no longer had the ability to enrich uranium or to manufacture new ballistic missiles.
Netanyahu urged the Israeli public to remain steadfast in the face of ongoing Iranian missile salvos.
He said the war “will take as long as necessary” for Israel’s goals to be achieved: the decimation of Iran’s existing missile and nuclear stockpiles, and creating the conditions for the potential fall of the Islamic republic.
He added he was “not putting a stopwatch” on the duration of the conflict, but said in response to a journalist’s question: “I see this war ending a lot faster than people think. In war you have to grit your teeth.”
Netanyahu went to great lengths to emphasise his “historic” partnership with Trump.
The US president had earlier sought to distance himself from the Israeli attack on South Pars, claiming he “knew nothing” of it ahead of time.
But his account went against that of officials familiar with the operation, who said the strike was co-ordinated with Washington in advance.
Netanyahu said Israel acted alone in the strike, and he would “hold off on future attacks” on South Pars at Trump’s request.
Iran retaliated by firing missiles at Ras Laffan, the world’s largest liquefied natural gas facility in Qatar, and the tit-for-tat strikes on Wednesday and Thursday prompted a surge in oil and gas prices. Qatar is the second-largest exporter of LNG in the world, and the biggest supplier to Asia.
Iranian foreign minister Abbas Araghchi said Tehran would show “zero restraint” if its energy infrastructure was attacked again.
Trump said he had admonished Netanyahu for the strike on South Pars. “I told him, ‘don’t do that’ — and he won’t do that,” he added. “We’re independent, but get along great. It’s co-ordinated, but on occasion he’ll do something and if I don’t like it — [I tell him] we’re not doing that.”
Trump, meanwhile, claimed he would not send more troops to the Middle East. “No, I’m not putting troops anywhere,” he told reporters in the Oval Office.
But he was not definitive, adding that “if I were, I certainly wouldn’t tell you”, and that the US “would do whatever is necessary” to keep the price of oil down.
Netanyahu pushed back against the idea that he had misled Trump into another war in the Middle East, calling it “fake news”.
“Does anyone really think someone can tell President Trump what to do? Come on. President Trump always makes his decisions on what is good for America.”
Netanyahu said Trump understood the acute danger of a nuclear-armed Iran capable of firing on the US.
Traders said markets starved of positive developments had overreacted to Netanyahu’s remarks on Israel working to reopen the Strait of Hormuz. About one-fifth of the world’s oil normally transits through the waterway.
“We caught a glimpse of how markets will react if [and] when people think that the Strait of Hormuz will open,” said Mike Zigmont at Visdom Investment Group.
