Tensions in the Middle East escalated sharply on Saturday after a missile struck inside the compound of the United States Embassy Baghdad, amid a growing confrontation between Iran and the United States following American airstrikes on Iran’s strategic oil hub at Kharg Island.

According to early reports, a missile landed inside the heavily fortified diplomatic compound located in Baghdad’s Green Zone. There were no immediate confirmed reports of casualties, but security forces in the Iraqi capital increased alert levels while helicopters were seen flying over the area shortly after the strike.

The incident comes hours after Washington reportedly carried out military strikes targeting Iranian facilities on Kharg Island, the country’s main oil export terminal in the Persian Gulf. The attack marks a significant escalation in tensions between the two countries and threatens to destabilize one of the world’s most vital energy corridors.

Iran responded with strong warnings, declaring that it would widen the conflict if its oil infrastructure continues to be targeted. Iranian officials said that attacks on Kharg Island crossed a “red line” and vowed retaliation against what they described as American and “US-linked” interests across the region.

For the first time since the crisis began, Tehran also threatened to target infrastructure in neighboring states if they assist US military operations. Iranian authorities urged residents to evacuate major ports in the United Arab Emirates, alleging—without providing evidence—that American forces had used some of the country’s ports to launch missile strikes against Iran.

Meanwhile, Donald Trump stated that “many countries” were preparing to deploy naval forces to ensure freedom of navigation through the strategically crucial Strait of Hormuz, through which nearly a fifth of the world’s oil supply passes.

Military analysts warn that any disruption in the Strait of Hormuz could trigger a global energy crisis and pull additional countries into the conflict.

Regional governments have begun closely monitoring the situation as fears grow that the confrontation between Iran and the United States could rapidly expand into a broader regional war.

Diplomatic sources in Baghdad said Iraqi authorities are attempting to prevent their territory from becoming a battlefield between rival powers, as the latest strike near the US embassy highlights the fragility of security in the country.