US President Donald Trump threatened on Monday to hit Iran "hard" after the two foes traded fire for the first time in weeks, as his Treasury secretary vowed to keep up a pressure campaign aimed at hobbling Tehran's economy. After six months of war, the foes remain at an impasse, with Iran keeping the strategic Strait of Hormuz closed and the US persisting with a naval counter-blockade of Iranian ports.

'We're going to hit them hard,' US president says; Tehran source downplays flare-up, says it's 'limited and contained'; US vows to persist with economic pressure campaign

First exchange of fire between two countries in more than a month sends oil prices rising 3%