A ceasefire between Iran and the United States was teetering on Monday as both countries traded fire over the strategic Strait of Hormuz.

The United Arab Emirates reported missile and drone attacks from Iran, the first such strikes since the truce was declared nearly a month ago. President Donald Trump threatened that Iran would be “blown off the face of the earth” if it attacks US ships.

Is the US-Iran ceasefire still holding?

The ceasefire is under severe strain but has not formally collapsed. Both sides have exchanged attacks over the Strait of Hormuz, the UAE has reported Iranian strikes on its territory, and diplomacy between Washington and Tehran has stalled since the truce was declared. Neither government has officially declared the agreement void.

Why has Iran attacked the UAE?

Iran did not formally claim responsibility for the strikes on the UAE, a close US ally and key Arab partner of Israel. A senior Iranian military official said the attacks were a consequence of what he described as “US military adventurism” to force ships through the Strait of Hormuz. He said Washington, not Tehran, must be held accountable.

The UAE’s foreign ministry condemned the strikes as a “dangerous escalation and an unacceptable transgression.” A strike on an energy installation in the emirate of Fujairah injured three Indian nationals. Two more people were injured when a residential building was hit in Oman’s Bukha, along the Hormuz coastline.

According to the UAE defense ministry, Iran fired four cruise missiles, three of which were shot down and one of which fell into the water. Iran also fired drones at a tanker affiliated with its state-owned oil giant ADNOC.

What is Project Freedom and how does it affect the strait?

Trump announced “Project Freedom” on Sunday, describing it as a humanitarian operation to escort trapped vessels out of the Gulf. US Central Command said guided-missile destroyers had transited Hormuz and that two US-flagged merchant vessels had travelled out of the Gulf as a first step. Iran’s Revolutionary Guards denied the US account, saying no commercial vessels or oil tankers had passed through the strait in the preceding hours.

A US admiral said US forces sank six small Iranian ships during the exchanges. Iran denied that any combat vessels were hit, but accused the US of killing civilians. Iranian state TV posted on Telegram that US forces “attacked two small boats carrying people” and “martyred five civilian passengers.”

How are oil prices and global markets responding?

Oil prices climbed sharply after the UAE attacks. Brent crude for July delivery jumped more than five percent. Soaring energy costs since the war have caused economic pain globally and created a political problem for Trump ahead of congressional elections.

Seoul said an “explosion and fire” struck a South Korean ship in the strait on Monday. As of April 29, more than 900 commercial vessels were located in the Gulf, according to maritime intelligence firm AXSMarine. Trump appeared to play down the Iranian strikes, writing on social media that Iran had “taken some shots” but caused little damage.

What are diplomats saying about a path forward?

Iranian Foreign Minister Abbas Araghchi said the clashes showed there was “no military solution to a political crisis” and pointed to Pakistan’s ongoing mediation efforts. “The US should be wary of being dragged back into quagmire by ill-wishers. So should the UAE. Project Freedom is Project Deadlock,” he wrote on X.

Diplomacy between Washington and Tehran has been stalled since the ceasefire, with the United States twice cancelling plans for senior officials to attend talks in Pakistan. Trump has also voiced doubt about an Iranian proposal.

What is happening in Lebanon and the wider region?

A separate ceasefire in Lebanon is also under strain. Israel has heavily bombed and invaded Lebanon with ground troops in response to fire from Iranian-backed Hezbollah. The Israeli strikes have killed more than 2,700 people, according to Lebanon’s health ministry.

Hezbollah and Israeli troops clashed in southern Lebanon on Monday, with two Israeli soldiers reported to have sustained moderate injuries. Lebanese President Joseph Aoun called for a security deal and an end to Israeli attacks before any meeting with Israeli Prime Minister Benjamin Netanyahu, a potentially historic encounter Trump has proposed for this month at the White House.