Iran rejects Trump’s economic threats as Middle East tensions rise

Iran on Thursday dismissed threats by US President Donald Trump of economic pain and isolation for the country, while six European nations and Canada condemned Israel over a settlement project in the occupied West Bank.

Doctors Without Borders criticised the Israeli military’s decision not to investigate two fatal attacks on the medical humanitarian organisation’s staff, while in Gaza City, a mass funeral was held for 50 Palestinians killed in Israeli airstrikes nearly three years ago whose remains were only recently recovered.

Here’s a look at the latest developments in the Iran war and the wider Middle East on Thursday.

Iran denounces Trump’s economic threat

Iranian Foreign Minister Abbas Araghchi rejected economic threats made against his country, saying such “failed policies” would stir more hostility among Iranians and “bring more failures”.

Araghchi’s comments came hours after Trump threatened “crushing economic measures” against Iran. The US president promised “Economic Warfare and Isolation on an unprecedented scale” but provided few details.

In a social media post, Araghchi said the threats were aimed at diverting the attention of the US public from domestic financial problems, calling US “economic terrorism” a threat to the global economy and the national sovereignty of countries around the world.

US Treasury Secretary Scott Bessent said on Thursday that Iran would face the “greatest coordinated economic isolation in the history of the world”.

In a CNBC interview, Bessent threatened secondary sanctions against nations and companies conducting business with Iran, saying it was time for US allies to decide where they stood.

China and India are major buyers of Iranian oil, though Bessent did not name them specifically.

Doctors Without Borders condemns Israeli military

Doctors Without Borders said the Israeli military’s decision not to open criminal investigations into two strikes that killed four people showed that Israel was unwilling to take responsibility for attacks on civilians.

The international aid group called for an impartial investigation into the deaths but did not specify who should lead it.

Doctors Without Borders had asked the Israeli military to investigate an attack on a Gaza City convoy in November 2023 and a strike on the organisation’s shelter in Khan Younis in February 2024. Israel’s military announced on Wednesday that it would not launch criminal investigations into the two cases, in which its troops killed the organisation’s employees.

The decision showed “there is no prospect of accountability within the Israeli legal system for the killing of our staff”, Doctors Without Borders said in a statement, citing 15 staff members and 1,700 healthcare workers killed in Gaza since October 2023.

Israel denies accusations of genocide and war crimes and says it is targeting Hamas after the militant group’s attack on southern Israel that killed 1,200 people and took 251 hostages on Oct. 7, 2023. Israel blames civilian deaths on Hamas, saying the group operates in populated areas of the densely populated Gaza Strip.

UK and others condemn planned West Bank settlement project

Six European countries and Canada condemned the latest development in a contentious Israeli settlement project near Jerusalem that would effectively cut the occupied West Bank in two.

Israel’s Ministry of Construction and Housing issued a tender for several compounds containing more than 1,200 homes in an open tract of land east of Jerusalem. It is the latest step in a project that has been under consideration for more than two decades and which critics say would prevent the establishment of a contiguous Palestinian state.

The joint statement by the leaders of the UK, France, Germany, Italy, the Netherlands, Norway and Canada said international law was clear that the settlement was illegal and noted “unprecedented levels of violence by settlers against civilians”.

“We urge the government of Israel to retract these plans immediately and end its expansion of settlements in the West Bank. Not only will they take us further from peace, but they further undermine Israel’s international standing,” the countries said.

Egypt and Jordan also condemned Israel’s move.

Israeli Foreign Minister Gideon Saar defended “the historic right of the Jewish people to reestablish their national home in the Land of Israel — including in the area in question”. Saar criticised the UK government for “blaming only Israel while ignoring Palestinian extremism”.

Gaza funeral held for 50 killed in early strikes

A mass funeral in Gaza City on Thursday commemorated 50 Palestinians killed in Israeli strikes during the opening months of the Israel-Hamas war, whose remains were only recently recovered from under the rubble.

Dozens of mourners carried the remains, draped in Palestinian flags, through debris-strewn streets before lowering them into graves. Some held portraits and posters showing photographs of the deceased.

“We were able to recover them after three years of war, after three years of anguish, pain and torture. We were able to recover them, and dignify them in their final resting place. We were able to pray over them and bury them,” said Lina Karam, who lost her father and other family members.

The 50 bodies were from three families killed in airstrikes in November and December 2023.

The nearly three-year war has killed more than 73,400 Palestinians, according to Gaza’s Health Ministry. The ministry, which was part of the Hamas-run government, maintains detailed records considered generally reliable by UN agencies and international organisations. It does not distinguish between civilians and militants but says women and children account for around half of the toll.

US sanctions network accused of supporting Hezbollah

The US announced new sanctions on Thursday against a network of people accused of funnelling cash into Lebanon for the Iran-backed Lebanese militant group Hezbollah.

The network, run by Turkish businessman Yunus Alper Yilmaz, uses couriers travelling on commercial flights between Lebanon, Turkey, the UAE and Iran to move up to hundreds of millions of dollars between jurisdictions outside the formal financial system, the US Treasury Department said.

The Treasury also redesignated Hezbollah, which was already under US sanctions, as an Iranian proxy acting on behalf of Iran’s Islamic Revolutionary Guard Corps Quds Force rather than as a stand-alone organisation.

The redesignation was intended to underscore that Hezbollah “operates with little to no regard for Lebanese sovereignty, the Lebanese people or the Lebanese state”, the Treasury said.

Turkey denies delegation visited Syrian air base

Turkey denied that a Turkish military delegation had visited an air base in northern Syria that was hit by Israeli airstrikes, while vowing to continue supporting Syria’s efforts to rebuild its military.

The Israeli strikes targeted the Abu Duhur base early on Tuesday, causing damage but no casualties. Israeli Prime Minister Benjamin Netanyahu’s office said Israel attacked the base because Syria was “on the verge of breaching” an agreed “status quo in security matters” by allowing Turkish troops to deploy there.

Syrian officials have said a Turkish delegation visited the base before the Israeli strike to review rehabilitation work underway there.

Syria’s top diplomat discusses Middle East in Pakistan

Syrian Foreign Minister Asaad al-Shibani arrived in Islamabad for talks expected to focus on regional issues, Pakistan’s Ministry of Foreign Affairs said.

The visit comes days after Israeli airstrikes targeted an air base in northern Syria, causing damage but no casualties.

Pakistani officials said the country’s political and military leadership remained in contact with both Iran and the United States over efforts to de-escalate tensions and resume talks, after a 60-day deadline under a June memorandum of understanding expired. Pakistan brokered the agreement with help from regional countries.

Bodies of Pakistani sailors returned after Houthi attack

The bodies of two Pakistanis killed in last week’s Houthi attack on a Tanzanian-flagged commercial vessel in the Bab el-Mandeb Strait have been repatriated to Pakistan.

Six Pakistani sailors who were wounded in the attack have also safely returned to the country, Foreign Minister Ishaq Dar said in a post on X.