By Nayera Abdallah, Humeyra Pamuk and Gram Slattery
DUBAI/ANKARA, July 9 (Reuters) - Iranian armed forces targeted U.S. military infrastructure in neighbouring Gulf states on Thursday following U.S. strikes on Iran's southern coastal and eastern provinces, putting further strain on a three-week-old ceasefire agreement.
Iran was also preparing on Thursday to bury its slain Supreme Leader Ayatollah Ali Khamenei at the country's holiest shrine in Mashhad, in the northeast, the culmination of a week of mass
funeral processions and rallies. Khamenei was killed in a U.S. airstrike on the first day of the war on February 28.
Oil prices, which had spiked amid concerns over the impact of the renewed attacks on global supplies, fell back on Thursday as investors weighed whether the flare-up was tactical and temporary or might augur a complete collapse in the ceasefire.
The U.S. military said on Wednesday its latest strikes on Iran were aimed at keeping the Strait of Hormuz open after Iran targeted three tankers in the area. The assault came hours after U.S. President Donald Trump said he believed the interim ceasefire with Iran to be "over".
Iranian officials said the U.S. attacks had killed 14 people and injured 78 across five provinces on July 8 and 9, state media reported. The Fars news agency said one U.S. strike had hit a rail bridge used for trade with Russia and China.
Several explosions were heard on Thursday morning in Iran's Bushehr province, the semi-official Mehr news agency reported. Bushehr is home to a Russian-built nuclear power plant.
TARGETING U.S. MILITARY IN QATAR, KUWAIT, BAHRAIN
Iran's army said in a statement released by state media that it had targeted U.S. Patriot systems with drones in Kuwait, an early warning site in Qatar (satellite antenna) and a fuel storage of the U.S. army in Bahrain.
Kuwait said its armed forces had engaged with a cruise missile, three ballistic missiles and 10 drones in its airspace, and that one person had been injured from falling shrapnel.
Qatar, which hosts the largest U.S. military base in the region and has often mediated between Washington and its adversaries including Tehran, called for a return to diplomacy.
In a phone call with Iranian Foreign Minister Abbas Araqchi, Qatar's Prime Minister Sheikh Mohammed bin Abdulrahman al-Thani also condemned attacks targeting commercial shipping in the Strait of Hormuz.
While Iran has not claimed responsibility for the ship attacks, analysts say Tehran uses such actions to gain leverage in negotiations.
The Strait of Hormuz handled about a fifth of global oil supplies before the war erupted on February 28 with U.S. and Israeli strikes against Iran.
Tehran has since taken effective control of the strait, allowing it to force a stalemate in its confrontation with the world's most powerful military.
"The U.S. has yet to learn that bullying and breaking its commitments no longer come without a cost. Let me be clear: If you strike, you will be struck back," Iran's top negotiator, Mohammad Baqer Qalibaf, wrote on X.
"The Strait of Hormuz will be reopened only under Iranian arrangements, not through U.S. threats."
'RETRIBUTION'
The U.S. Central Command (CENTCOM) said on Wednesday its forces had struck approximately 90 Iranian military targets, including air defense systems, coastal surveillance assets, missile and drone storage sites, naval capabilities, and military logistics infrastructure along Iran's coastline.
"The United States is holding Iran accountable for recent unjustified aggression against commercial shipping and civilian crews freely navigating a vital international waterway," CENTCOM said in a statement.
"This is in retribution for yesterday’s bombing of ships by Iran. If it happens again, it will get much worse!" Trump wrote on his Truth Social platform on Wednesday.
However, the U.S. leader, who was attending a NATO summit in Turkey, also said he did not think the latest military strikes would escalate into a full-fledged conflict with Iran.
"Anything that happens is going to be over very quickly ... and will only make it safer, including for oil," he told reporters in Ankara.
Asked before the NATO summit on Wednesday whether the memorandum of understanding with Iran was over, Trump said: "It's a very interesting question. To me, I think it's over. I don't want to deal with them."
"If we make a deal with Iran I'm not sure that will stick," Trump later said.
One of the three vessels hit this week, Qatari LNG tanker Al Rekayyat, remains stranded and awaiting salvage operations off Oman after a projectile strike late on Tuesday sparked a fire in its engine room, though industry sources said its cargo appeared secure and the risk of an explosion is low for now.
(Reporting by Reuters reportingWriting by Gareth Jones, Editing by Alexandra Hudson)
