Kuwait accused Iran on Tuesday (May 12, 2026) of sending an armed paramilitary Revolutionary Guard team to attack an island in the West Asian nation home to a China-funded port project, just before U.S. President Donald Trump travels to Beijing for a meeting with Chinese President Xi Jinping.

Iran didn’t immediately acknowledge the allegation by Kuwait, which came under repeated attack by Iran in the war and even during the shaky ceasefire still holding in the region. However, the allegation and ongoing attacks throughout the region have threatened to tip the region back into open warfare.

The accusation came as the U.S. Ambassador to Israel, Mike Huckabee, said that Israel sent Iron Dome anti-missile batteries and personnel to operate them to the United Arab Emirates to defend the country during the war as well.

That underlined the growing defence relationship between Israel and the UAE, countries long suspicious of Iran. It also represents the first publicly acknowledged deployment of Israel’s military to the Emirates, a federation of seven sheikdoms on the Arabian Peninsula home to Abu Dhabi and Dubai.

The narrow Strait of Hormuz remains in Tehran’s chokehold, and negotiations between the US and Iran appear at a standstill for the moment — also raising the risk of the conflict breaking out again.

Efforts to end the war between the U.S. and Iran appeared to stall as the two sides traded fire in ‌the Gulf on Friday (May 8, 2026), while a U.S. intelligence analysis concluded Tehran could withstand a naval blockade for months.

A ​CIA assessment indicated that Iran would not suffer severe economic pressure from a U.S. blockade of Iranian ⁠ports for about another four months, according to a U.S. official familiar with the matter, suggesting that U.S. leverage over Tehran remains limited as the two sides seek to end a conflict that has been unpopular with U.S. voters.

Iran-Israel war LIVE- May 9, 2026

The Washington Post first reported the assessment. Recent days have seen the biggest ‌flare-ups in fighting in and around the Strait of Hormuz since a ceasefire began a month ago, and the United Arab Emirates came under renewed attack on Friday (May 8, 2026).

Washington is awaiting Tehran’s response to a U.S. proposal that would formally ‌end the war before talks on more contentious issues, including Iran’s nuclear program. “We should know something today,” U.S. Secretary of ‌State Marco ⁠Rubio told reporters in Rome earlier in the day. “We’re expecting a response from them.” Iran’s Foreign Ministry spokesperson ⁠said Tehran was still weighing its response, and none was reported by mid-afternoon in Washington, just before midnight in Tehran.

Sporadic clashes in Strait

Meanwhile, more sporadic clashes between Iranian forces and U.S. vessels took place in the Strait of Hormuz, Iran’s semi-official Fars news agency reported. The Tasnim news agency later cited an Iranian military source ​saying the situation had calmed, but warned more clashes were ‌possible. The U.S. military said it struck two Iran-linked vessels attempting to enter an Iranian port, with a U.S. fighter jet hitting their smokestacks and forcing them to turn back. Iran has largely blocked non-Iranian shipping through the strait since the war began with joint U.S.-Israeli airstrikes across Iran on February 28. The U.S. imposed a blockade on Iranian vessels last month.

Oil prices rose, with ‌Brent crude futures above $101 a barrel, though still down more than 6% for the week. Mr. Trump said on Thursday (May 7, 2026) the ​ceasefire was still holding despite the flare-ups in the strait, which, before the war, handled one-fifth of the world’s oil supply. The confrontation extended beyond the waterway. The United Arab Emirates said its air defences engaged with ⁠two ballistic missiles and three drones from Iran on Friday (May 8, 2026), with three people sustaining moderate injuries.

During the war, Iran has repeatedly targeted the UAE and other Gulf states that host U.S. military bases. In what the UAE called a “major escalation”, Iran stepped up attacks this week in ‌response to Mr. Trump’s announcement of “Project Freedom” to escort ships in the strait, which he paused after 48 hours.

Iran accuses U.S. of breaching truce

Iran accused the U.S. of breaching the ceasefire, which had largely held since it was announced on April 7 but has come under strain this week. “Every time a diplomatic solution is on the table, the U.S. opts for a reckless military adventure,” Foreign Minister Abbas Araghchi said on Friday (May 8, 2026). Iran’s Mehr news agency reported that one crew member was killed, 10 wounded and four missing after a U.S. Navy attack on an Iranian commercial ship late on Thursday (May 7, 2026).

Mr. Rubio, after meeting with Italian Prime Minister Giorgia Meloni, questioned why Italy ‌and other allies were not backing Washington’s efforts to reopen the strait. “Are you going to normalise a country claiming to control an international waterway? Because if ​you normalise that, you’ve set a precedent that’s going to get repeated in a dozen other places,” he said.

U.S. imposes sanctions

While pursuing diplomacy, the U.S. also ratcheted up sanctions to pressure Iran. The U.S. Treasury on Friday (May 8, 2026) announced ⁠sanctions against 10 individuals and companies, including several in China and Hong Kong, for aiding efforts by Iran’s military to secure weapons and raw ⁠materials used to build Tehran’s Shahed drones.

Treasury said in a statement it remains ready to take economic action against Iran’s military industrial base so Tehran cannot reconstitute its production capacity and project power outside its borders. It also said it was ‌prepared to act against any foreign company supporting illicit Iranian commerce, including airlines, and could impose secondary sanctions on foreign financial institutions that aid Iran’s efforts, including those connected to China’s independent “teapot” oil refineries.

The announcement came days before Mr. Trump plans to travel ​to China for a meeting with President Xi Jinping.

Amidst the looming fuel supply disruptions due to the West Asia crisis, total natural gas available for sale in India grew 7.8% in March 2026, fuelled by an increase in imports of liquified natural gas (LNG), according to the latest government data. This increase in availability comes even though India’s net domestic production of natural gas for sale slipped 4.3% in March. March 2026 was the first month following the start of the West Asia crisis.

Separately, during a press briefing, Mukesh Mangal, Additional Secretary in the Ministry of Ports, Shipping and Waterways, confirmed to reporters that the Shipping Corporation of India (SCI) was looking into how it can resume services to West Asia.

Iran has executed at least 21 people and arrested more than 4,000 since the West Asia war began, the United Nations said on Wednesday (April 29, 2026).

Since the U.S.-Israeli strikes sparked the war in late February, at least nine people have been executed in connection with the protests that rocked Iran in January 2026, another 10 for alleged membership of opposition groups, and two on spying charges, the U.N.’s rights office OHCHR said.

U.S. President Donald Trump granted ‌a 90-day extension to a shipping ​waiver that makes it ⁠easier to move oil, fuel and fertilizer around the United States, the White House ‌said on Friday (April 24, 2026), the latest effort to curb rising energy ‌costs linked to the ‌war ⁠with Iran. The decision adds ⁠roughly three months to the existing waiver that was set to expire on May ​17, enabling foreign-flagged vessels ‌to move commodities between U.S. ports through mid-August.

White House spokeswoman Taylor Rogers confirmed on Friday (April 24, 2026) that Mr. Trump ‌had issued the extension. “This waiver ​extension provides both certainty and stability for the U.S. and ⁠global economies,” Ms. Rogers said. The Jones Act has long been a flashpoint ‌between competing economic and national security priorities. Supporters, including U.S. shipbuilders, maritime unions and some lawmakers, argue the law is critical to maintaining a domestic shipping industry and merchant ‌marine that can support military logistics ​and national security.

Israel’s military said it struck a missile launcher in Lebanon that had fired into Israel on Thursday (April 23, 2026) in an attack that Israeli air defences intercepted. Hezbollah claimed the attack.

Israel’s announcement of the strike came soon after U.S. President Donald Trump said the Israel-Lebanon ceasefire had been extended by three weeks.

HSBC downgraded Indian equities to “underweight” from “neutral” – its ​second cut in less than a month – as it ‌expects surging energy prices triggered by the Middle ​East war to threaten the durability ⁠of the country’s earnings recovery. Brent crude is up 42% since the war started in late February and is currently ‌trading above $100 a barrel, raising inflation and growth risks for the world’s third-largest oil importer.

“India ‌now looks less attractive than North ‌East ⁠Asian peers in the current macro setting,” HSBC ⁠said in a note on Thursday, with the benchmark Nifty 50 and Sensex falling 6.7% and 7.9% so far this year – ​among the worst ‌performing markets globally.