Senator Discusses Investigation into Iran School Bombing

Senator Mike Rounds, a member of the Armed Services Committee, addresses concerns regarding the bombing of a girls' elementary school in Iran at the onset of the conflict on “Bloomberg This Weekend” with David Gura and Christina Ruffini. Iran chose Mojtaba Khamenei, the hardline son of the assassinated Ayatollah Ali Khamenei, as its new supreme leader, signaling Tehran won’t back down in a war now raging across the Middle East and causing a surge in energy prices.

The choice was quickly criticized by US President Donald Trump, who is under mounting pressure as oil prices rise to near four-year highs and fears grow of a new inflation crisis.

The effective closure of the Strait of Hormuz has forced Saudi Arabia, the world’s biggest oil exporter, to reduce production, according to a person familiar with the matter. That follows similar moves by the United Arab Emirates, Kuwait and Iraq.

Mojtaba Khamenei in 2020.

Brent crude climbed about 11% to $103 as of 12:20 a.m. in London on Monday. It rose to almost $120 earlier in the day, but pared gains after people familiar with the matter said Group of Seven finance ministers are preparing to discuss a possible joint release of emergency fuel reserves.

Stocks tumbled and a global bond rout accelerated, while the dollar hit its highest level in seven weeks.

Trump, whose administration is already facing criticism after US gasoline pump prices jumped last week, called $100 oil a “small price to pay” and said the cost “will drop rapidly when the destruction of the Iran nuclear threat is over.”

Oil Surges Past $100 as Iran War Forces Production Cuts in Gulf

Brent crude

The war — now in its second week — shows no sign of easing off. The US and Israel continued to strike Iran, which is still attacking Israel and Arab Gulf states regularly with drones and missiles.

The North Atlantic Treaty Organization intercepted a ballistic missile fired from Iran toward Turkey on Monday, the second such incident, raising the risk the military alliance could be drawn more directly into the conflict.

Khamenei — whose father ruled Iran for almost 37 years and was killed when US-Israeli strikes began on Feb. 28 —  won a “decisive vote” in Iran’s Assembly of Experts to become supreme leader, Iranian media reported late Sunday. The 56-year-old has deep ties to the Islamic Revolutionary Guard Corps, about the most powerful military and economic organization in Iran and which pledged full obedience to the new leader.

Trump told Fox News he is “not happy” with Iran’s pick. Khamenei was a favorite to be selected, though there were several other candidates in the running, some of who might have been more amenable to the US.

Read More About the Iran War:

Iran’s New Supreme Leader Fights Trump, Israel and Anger at Home

Who’s Who in Iran? Guide to the Islamic Republic’s Top Leaders

Iran War Is Giving Markets a Covid-Like Shock: Shuli Ren

Stagflation Trades Sweep Markets as Trump Signals Widening War

Mojtaba “shares many of the same ideological leanings as his father and will aim to maintain continuity — including in the war,” said Dina Esfandiary, a Bloomberg Geoeconomics analyst. His election “suggests Iran won’t be shifting tack in the Middle East war,” she said.

On Saturday, Iran President Masoud Pezeshkian vowed not to back down, saying “the idea that we would surrender unconditionally — they must take such a dream to the grave.”

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