Missiles Target U.A.E., Ships Attacked as Fighting Threatens Iran Cease-Fire

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Sabrina Siddiqui (0:19)

Iran strikes a key oil port and attacks US warships and commercial ships, testing a shaky Middle East ceasefire. Plus, Amazon is making its shipping and logistics network available for hire.

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And demand is rising for actively managed ETFs. And so are the fees for BlackRock and other asset managers. It's Monday, May 4th. I'm Sabrina Siddiqui for The Wall Street Journal filling in for Alex Ossola.

This is the PM Edition of What's News, the top headlines and business stories that move the world today.

We start our show today with the Middle East. Fighting in the Iran conflict has flared up again after weeks of relative calm, and that's straining a ceasefire that was already fragile. The United Arab Emirates reported missile and drone attacks on its key oil hub, while US military forces intervened to protect commercial shipping in the region. During a call with reporters today, US Central Command Admiral Brad Cooper said Iran has attacked several ships.

SPEAKER_4 (1:37)

We know for certain we've been able to defeat an attack, but I don't want the Iranians knowing what they were able to do, what that looked like.

Sabrina Siddiqui (1:45)

Shelby Holliday, a Wall Street Journal senior video and national security correspondent, has the latest. Shelby, how significant is this flare-up? Are we effectively watching the ceasefire unravel?

Shelby Holliday (1:56)

It's very significant. And what happened was the US launched a freedom of navigation effort that President Trump calls Project Freedom, where the US is helping commercial ships exit the Persian Gulf. It is meant to be a defensive operation, and the goal is to get all of these ships that have been bottled up in this region out and on with their journeys.

President Trump said if Iran tries to interfere with this effort, the US will respond. And that's exactly what we saw. We saw Iran launch cruise missiles, drones, even fast boat attacks at not just commercial ships, but also US Navy ships. And so I would expect a strong response from the US. The question is how big of a response that will be and whether it prompts retaliation from Iran.

Sabrina Siddiqui (2:36)

So is the president's new initiative to move ships out of the Gulf working?

Shelby Holliday (2:40)

That remains to be seen. So far we've heard that the US cleared a path in recent weeks, meaning cleared mines using underwater robots, and developed this way out through the Strait of Hormuz. It launched its effort to get ships out by using US flagships. That assumes the risk and demonstrates to other vessels that it is safe to transit this route.

However, Iran is still attacking ships. So, as of now, the time that you and I are speaking, we've only heard about two US-flagged ships leaving the Persian Gulf through this path. And we won't know if this is working for maybe another 24 hours. And we'll be looking to see whether ships from other countries are willing to try to get through the Strait of Hormuz.

Sabrina Siddiqui (3:22)

What diplomatic efforts, if any, are underway behind the scenes to contain this?

Shelby Holliday (3:27)

So far the US seems to be going it alone. They are the ones putting up this defensive umbrella, flying the aircraft, sending in the warships, and trying to get ships moving out of the Persian Gulf.

It was interesting because Iran attacked a South Korean-flagged ship today, and President Trump said maybe South Korea should get involved in this effort. So it's clear that the US wants other countries' help. However, the concern about Iran retaliation is very real, and other countries have said they don't want to send their own forces into this very tense and scary waterway until the hostilities have completely ceased, and that it's clear that everyone will be able to transit safely.

Sabrina Siddiqui (4:03)

That was the Wall Street Journal's Shelby Holliday. Shelby, thank you.

Shelby Holliday (4:06)

Thank you.

Sabrina Siddiqui (4:07)

Rising military tensions in the Iran War sent stocks lower and oil prices higher today. Brent crude, a global price gauge, rose 5.8% to more than $114 a barrel. That's the highest close for the most traded contract since 2022 The S&P and NASDAQ both closed out last week at record highs, and they slipped from those levels today.