KEY POINTS
  • Iran's top commander General Qasem Soleimani has been killed in a U.S. airstrike in Baghdad, the Pentagon confirmed on Thursday night following reports of his death on Iranian state television and Iraqi media.
  • His death exacerbated already-high tensions between Iran and the United States and triggered concerns of retaliation from Iranian forces.
  • The U.S. strike followed attacks by Iran-backed militias on the American Embassy in Baghdad.
  • Oil prices surged amid the escalating tensions.

WASHINGTON — Iran's top commander, Gen. Qasem Soleimani, has been killed in a U.S. airstrike in Baghdad, the Pentagon confirmed Thursday night following reports of his death on Iranian state television and Iraqi media.

Soleimani, who led a special forces unit of Iran's elite Revolutionary Guards, had been a key figure of Iranian and Middle East politics. His death exacerbated already-high tensions between Iran and the United States and triggered concerns of retaliation from Iranian forces.

File photo of the commander of the Iranian Revolutionary Guard's Quds Force, Gen. Qasem Soleimani.

Oil prices rocketed by nearly 4% in the morning of Asia trading hours, while Brent crude soared 3.98% to $68.90 per barrel. U.S. crude surged 3.87% to $63.55 per barrel.

Here is the full statement from the Department of Defense:

At the direction of the President, the U.S. military has taken decisive defensive action to protect U.S. personnel abroad by killing Qasem Soleimani, the head of the Iranian Revolutionary Guard Corps-Quds Force, a U.S.-designated Foreign Terrorist Organization.

General Soleimani was actively developing plans to attack American diplomats and service members in Iraq and throughout the region. General Soleimani and his Quds Force were responsible for the deaths of hundreds of American and coalition service members and the wounding of thousands more. He had orchestrated attacks on coalition bases in Iraq over the last several months — including the attack on December 27th — culminating in the death and wounding of additional American and Iraqi personnel. General Soleimani also approved the attacks on the U.S. Embassy in Baghdad that took place this week.

This strike was aimed at deterring future Iranian attack plans. The United States will continue to take all necessary action to protect our people and our interests wherever they are around the world.

Hours after the Pentagon's announcement, Iran's Foreign Minister Mohammad Javad Zarif said on Twitter that the killing of Soleimani was "extremely dangerous & a foolish escalation."

"The US bears responsibility for all consequences of its rogue adventurism," he said.

The latest development comes on the heels of a New Year's Eve attack by Iran-backed militias on the U.S. Embassy in Baghdad. The two-day embassy attack prompted President Donald Trump to order the deployment of approximately 750 U.S. soldiers from the 82nd Airborne Division to the Middle East.

The wave of protests in Iraq came hours after the U.S. carried out military airstrikes in Iraq and Syria against an Iranian-backed militia group on Sunday.

Trump ordered the "precision defense strikes" on five Kataeb Hezbollah facilities following a string of attacks on Iraqi military bases that host American troops. Last week, a U.S. civilian contractor was killed in a rocket attack on an Iraqi base near Kirkuk.

On Thursday, Secretary of Defense Mark Esper told reporters at the Pentagon that the U.S. may conduct preemptive strikes against Iranian-backed militias.

"If we get word of attacks, we will take preemptive action as well to protect American forces, protect American lives. The game has changed," he said.

U.S. Secretary of Defense Mark Esper speaks during the joint press conference with Chairman of Joint Chiefs of Staff General Joseph Dunford (not in the picture) on August 28, 2019 in Arlington, Virginia.

Earlier this month, Secretary of State Mike Pompeo blamed Iranian-backed forces for a series of attacks on bases in Iraq and warned that any future attacks on Americans or U.S. allies would be "answered with a decisive U.S. response."

"As long as its malign behaviors continue, so will our campaign of maximum pressure," Pompeo said during a Dec. 11 press conference at the State Department.

Following Soleimani's death and that of one of his aides in the U.S. attack, Helima Croft, head of global commodity strategy at RBC Markets, warned: "This brings us to the precipice of a full-blown shooting war with Iran — not a shadow war or a proxy war."

"It is almost impossible to overstate the implications of this event," she told CNBC via email.

Tensions between Tehran and Washington have soared following Trump's withdrawal from the landmark Iran nuclear deal brokered by the Obama administration.

The 2015 nuclear agreement lifted sanctions that crippled Iran's economy and cut its oil exports roughly in half. In exchange for sanctions relief, Iran accepted limits on its nuclear program and allowed international inspectors into its facilities.

Hassan Rouhani, Iran's president, pauses whilst speaking during a news conference in Tehran, Iran, on Monday, Oct. 14, 2019.

Democratic presidential candidate Joe Biden warned that "Iran will surely respond."

"President Trump just tossed a stick of dynamite into a tinderbox, and he owes the American people an explanation of the strategy and plan to keep safe our troops and embassy personnel, our people and our interest, both here at home and abroad, and our partners throughout the region and beyond," he said on Twitter.

Sen. Elizabeth Warren called the U.S. attack a "reckless move" that "increases the likelihood of more deaths and new Middle East conflict."

The relationship between the U.S. and Iran worsened following a string of attacks in the Persian Gulf this summer.

In June, U.S. officials said an Iranian surface-to-air missile shot down an American military surveillance drone over the Strait of Hormuz. Iran said the aircraft was over its territory.

That strike came a week after the U.S. blamed Iran for attacks on two oil tankers in the Persian Gulf region and after four tankers were attacked in May.

The U.S. in June slapped new sanctions on Iranian military leaders blamed for shooting down the drone. The measures also aimed to block financial resources for Iran's Supreme Leader Ayatollah Ali Khamenei.

Tensions soared again in September when the U.S. blamed Iran for the strikes in Saudi Arabia on the world's largest crude-processing plant and oil field.

That attack forced the kingdom to cut its production operations in half and triggered the largest spike in crude prices in decades and renewed concerns of a new conflict in the Middle East. Iran maintains that it was not behind the attacks.

In September, Saudi Arabia's Defense Ministry said drone and missile debris recovered by investigators shows Iranian culpability. Saudi coalition spokesman Col. Turki al-Maliki said during a press briefing in Riyadh that all military components retrieved from the oil facilities "point to Iran."