Director of National Intelligence Jay Clayton warned Secretary of State Marco Rubio in a declassified memo dated October 23 that Iran is in the 'advanced stages' of planning lethal attacks against Americans in the Middle East and other unspecified countries. The memo, whose authenticity was confirmed by a US official, stated that Iran had 'substantially increased efforts to target U.S. personnel' [Source: CBS News]. CIA Director John Ratcliffe was copied on the communication, and Clayton noted that the intelligence community is working to downgrade sensitive intelligence so it can be shared more broadly with State Department personnel [Source: CBS News]. The memo did not identify specific targets or countries where the alleged plots are underway, nor indicate whether attacks may be imminent [Source: CBS News].
In response to the warnings, the State Department ordered a further reduction in staff at multiple diplomatic posts in the region, including in Lebanon, the United Arab Emirates, Qatar, and Jordan [Source: NBC News]. The alerts followed a US order earlier in the week for non-emergency government employees to leave Saudi Arabia, and the State Department also updated travel advisories for 14 countries in the Middle East to reflect the threat of Iranian-supported Houthi regional aggression [Source: CBS News]. The US military has been quietly scaling back its troop presence at bases across the Middle East in recent days, a drawdown described as similar to those initiated by the Defense Department and State Department around the start of the war with Iran in February [Source: NBC News].
Oil markets reacted sharply to the escalating tensions. Brent crude futures rose as much as 3.8% to $117.45 a barrel before trimming gains to settle at $116.72, according to the Financial Times, reaching its highest level since June 2022 and surpassing the peak recorded at the start of the war [Source: Financial Times via 24NewsHD]. The Brent benchmark has gained more than 10% this month and more than 6% on the week. West Texas Intermediate crude traded above $100 a barrel, and Brent contracts for delivery in April 2027 also traded above $100 [Source: Financial Times via 24NewsHD]. Saudi Aramco instructed staff to evacuate its Dhahran headquarters and work remotely following a series of attacks. Exxon Mobil closed at $177.86 on 20 October, up 10.8% over the prior four weeks, while Chevron closed at $225.71, up 10.4% over the same period, according to Valdrans data. US crude inventories for the week ending 16 October fell by 3,060 thousand barrels to 412,517 thousand barrels, per Valdrans data compiled from EIA figures.
The diplomatic and intelligence escalation comes against a backdrop of stalled peace efforts. Talks between the US and Iran have made little progress despite the two countries signing a memorandum of understanding in June aimed at ending the war that began with joint American-Israeli strikes on Iran in February [Source: ABC News]. The US says it is enforcing a blockade preventing Iranian ships from entering or leaving the country, while Iran claims control over the Strait of Hormuz and continues to claim attacks on shipping transiting the waterway [Source: ABC News]. Iran-backed Houthis have attacked civilian infrastructure inside Saudi Arabia, including multiple attacks on airports that have wounded and killed civilians [Source: The Hill]. The existence of the Clayton memo was first reported by Axios [Source: ABC News].
Sources: CNBC, CBS News, ABC News, NBC News, Financial Times, Trading Economics, The Hill, Valdrans Data