Iran is asserting its control over a vital waterway amid the ongoing war as President Trump threatens to obliterate any ships laying mines in the crucial territory.

The war with Iran has choked off nearly all of the oil traveling from Iranian coast through the Strait of Hormuz, as vessels originating from other countries are being struck by Iranian forces.

Trump promised that Iranian ships blocking oil exports would be 'dealt with quickly and violently' as Defense Secretary Pete Hegseth said the US 'will not allow terrorists to hold the Strait of Hormuz hostage.'

One-fifth of the world's oil supply typically passes through the strait, according to the Wall Street Journal. Amid the turmoil, the price of a barrel of oil breached $100 over the weekend for the first time since 2022.

Early Wednesday, a ​cargo vessel ‌was hit by an ​unknown ​projectile in the ⁠strait ​of Hormuz, ​resulting in a fire onboard ​and ​prompting the crew ‌to ⁠evacuate. 

Countries around the world are already starting to feel the pinch from the blockade, with some even imposing measures like price caps and rationing to keep the cost of oil down. 

But the situation may grow even more dire, as JPMorgan Chase analysts warned Gulf oil supplies could be cut by 3.8 million barrels a day - amounting to three percent of global production.

Trump last week suggested that US may soon escort ships through the strait to keep the world's oil supply flowing. But Ali Reza Tangsiri, the commander of Iran's navy, warned against any planned American escorts.

'Any passage of the US fleet and its allies will be halted by the net of Iranian missiles and suicide drones,' Tangsiri posted on social media.

Ali Larijani, Iran's security chief, similarly warned on X that the Strait of Hormuz could either be a 'strait of peace and prosperity for all' or it could turn into a 'strait of defeat and suffering for warmongers.' 

In the meantime, US Central Command announced on Tuesday that American forces destroyed 16 Iranian minelaying vessels near the Strait of Hormuz.

President Trump, who has previously said he is 'not afraid' to use military force to keep the passage open, also posted on social media that the US military 'completely destroyed' the inactive Iranian mine-laying vessels.

In his social media post he added that there would be 'more to follow.' 

'If for any reason mines were placed, and they are not removed forthwith, the Military consequences to Iran will be at a level never seen before,' Trump wrote, adding later that the ships 'will be dealt with quickly and violently.'

He had also previously warned on Monday that 'If Iran does anything that stops the flow of Oil within the Strait of Hormuz, they will be hit by the United States of America TWENTY TIMES HARDER than they have been hit thus far.'

Similarly, Hegseth said that the US 'will not allow terrorists to hold the Strait of Hormuz hostage.'

The mines could have make it impossible for tankers to pass through the strait, which is just 21 miles wide at its narrowest point.

'Those ships must avoid the mines and the mines themselves, the placement of the mines, create a challenge for the ship operators,' Retired US Maj. Gen. Mark MacCarley explained to CNN's Elex Michaelson.

He added that the threat of the explosives would 'funnel those ships into a very small vector' and a single mine could then take out multiple ships.

'If two or three of those huge tankers are in fact taken out,' it would 'significantly... impact the economies of most of the world.'

Without passage through the strait, Gulf countries like Saudi Arabia, the United Arab Emirates, Kuwait and Iraq have already been forced to cut oil production, causing US gas prices to rise about 17 percent since the start of the war.

After hitting a peak of nearly $120 per barrel over the weekend, prices started to dip slightly after Trump declared on Monday that the war is 'pretty much' over. 

It then fell again to below $80 a barrel on Tuesday after Energy Secretary Chris Wright posted a claim that the US military provided protection for an oil tanker traveling through the Strait of Hormuz.

He quickly deleted the post, however, and White House Press Secretary Karoline Leavitt later denied that a military escort had occurred.

'I can confirm that the US Navy has not escorted a tanker or vessel at this time,' she told reporters. 'Though, of course, that's an option the president has said he will absolutely utilize if and when necessary at the appropriate time.'

But the US Navy has refused near-daily requests from the shipping industry for military escorts, saying the risk of attacks is too high for now, sources familiar with the matter told Reuters.

Officials in other countries, though, have started to take action - with the Gulf nations proposing a resolution at the United Nations calling for, among other things, freedom to navigate through the Strait. 

The International Energy Agency has also proposed the largest release of oil reserves in its history, the Wall Street Journal reported.

It said the release would exceed the 182 million barrels of oil that IEA member nations put on the market in two releases in 2022 when Russia launched its full-scale invasion of Ukraine.

Member nations are now expected to vote on the proposal on Wednesday, as G7 leaders hold a video conference to discuss the economic impacts of the war in the Middle East.

Meanwhile, President Trump announced on Tuesday plans for a new oil refinery to be built in Brownsville, Texas. 

America First Refining said in a statement that a 168,000 barrel-per-day refinery to be built at the port of Brownsville along the U.S.-Mexico border, when operating, would offset $300 billion in the US trade deficit.

'This project represents a historic step forward for American energy production,' said John V. Calce, chairman and founder of America First Refining. 

'For the first time in half a century, the United States will build a new refinery designed specifically for American shale oil.'

Trump also wrote on his Truth Social platform that the refinery would 'fuel US markets, strengthen our national security, boost American energy production, deliver billions of dollars in economic impact, and will be the cleanest refinery in the world.'

In the meantime, the price of barrel of Brent crude - the international standard - was up nine cents at $85.36, down 11 percent from its settlement price the day before as markets started to open on Wednesday.

US benchmark crude oil, meanwhile, gained 36 cents to $83.81 per barrel. 

The S&P 500 dipped 0.2 percent  to 6,781.48, the Dow Jones Industrial Average fell 34 points, or 0.1 percent to 47,706.51 and the Nasdaq composite edged higher by less than 0.1 percent to 22,697.10 on Tuesday amid fears that the rising gas prices will translate to higher prices on goods as well.