Washington: US Treasury Secretary Scott Bessent warned late on Friday that the United States and Israel are preparing to launch the “biggest bombing campaign” of the week-long conflict against Iran, aimed at systematically dismantling the Islamic Republic’s missile production and launch capabilities.

Speaking in a televised interview, Bessent stated that the upcoming operations would be the most intense yet in "Operation Epic Fury," targeting factories and underground silos to "substantially degrade" Tehran’s ability to strike back. The warning came as President Donald Trump ruled out any diplomatic negotiations, demanding Iran’s “unconditional surrender.”

The escalation has sent shockwaves through global energy markets. With the Strait of Hormuz effectively closed to traffic, Brent crude surged 8.5% on Friday to $92.69 per barrel, marking a nearly 30% increase for the week.

To mitigate the supply shock, the Treasury Department issued General License 133, a temporary 30-day waiver allowing India to purchase Russian-origin crude oil currently "stranded at sea."

"This is a short-term measure to ensure oil keeps flowing to the global market," Bessent said, describing India as an "essential partner" in resisting Iran's attempt to "take global energy hostage."

On the ground, the conflict continues to widen. Israeli forces reported a "broad-scale" wave of strikes on government targets in Tehran early Saturday. Meanwhile, Iranian retaliatory strikes targeted America’s regional allies, with sirens sounding in Bahrain and Saudi Arabia reporting the interception of a ballistic missile aimed at Prince Sultan Air Base.

Market analysts warn that if the disruption to Gulf infrastructure persists, oil could test the $150 mark, threatening a global inflationary spike.