By Steve Holland and Enas Alashray

WASHINGTON/CAIRO, April 2 (Reuters) - Hopes for a swift end to the Middle East war faded on Thursday after U.S. President Donald Trump vowed more aggressive strikes on Iran, sending oil prices sharply up again in a blow to consumers around the world.

Stocks slid and the dollar gained after Trump said military operations would be intensified without offering the timeline that investors had sought for ending hostilities against Iran.

"We're going to hit them extremely hard over the next two to three weeks. We're going to bring them back to the Stone Ages where they belong," Trump said in a Wednesday evening prime-time speech.

Trump said the U.S. would achieve its military objectives soon but suggested the war could escalate if Iranian leaders did not give in to Washington's terms during negotiations, with strikes on Iran's energy and oil infrastructure possible.

He has said he may end the war with a deal and told countries that rely on fuel shipments through the Strait of Hormuz, which has been all but closed by Iranian attacks, to "just grab it".

European and other states have said they will only help secure the strait if there is a ceasefire. With pressure growing, some 40 countries were exploring ways to restore freedom of navigation at virtual talks on Thursday.

"It can only be done in consultation with Iran," French President Emmanuel Macron said during a visit to South Korea.

Iran's armed forces responded to Trump with a warning for the United States and Israel of "more crushing, broader and more destructive" attacks in store.

The war will continue until the "permanent regret and surrender" of Iran's enemies, said Ebrahim Zolfaqari spokesperson for the Iranian military's Khatam al-Anbiya central headquarters, in a statement carried by Iranian media.

COUNTRIES DISCUSS WAYS TO SECURE STRAIT OF HORMUZ

Fears are growing that the conflict may leave Iran with a stranglehold over Middle East energy supplies now that it has shown that it can block the vital Strait of Hormuz by targeting oil tankers and attacking Gulf countries hosting U.S. troops.

Gulf states say they reserve the right to self-defence but have not responded militarily to repeated attacks by Iran over the past month to avoid escalation into a far more devastating all-out Middle East war.

Iran's parliament was reviewing a bill that would formalise the blocking of vessels from hostile countries passing through the strait and the charging of tolls for others wishing to pass, spokesperson Abbas Goodarzi said.

Thousands of people have been killed across the Middle East since February 28, when the U.S. and Israel began air strikes on Iran, triggering Iranian attacks on Israel, U.S. bases and the Gulf states, while opening a new front in Lebanon.

Iran said several people were likely injured when a bridge linking Tehran and the western city of Karaj was hit by air strikes. Some of its largest steel producers and Tehran's Pasteur Institute of Iran medical research centre had sustained serious damage in the conflict, it said.

The country's Revolutionary Guards said they had targeted U.S.-linked steel and aluminium facilities in Gulf states and would step up such attacks if Iranian industries were hit again.

Israel, which shoots down most Iranian missiles, reported new incoming salvoes on Thursday, Saudi Arabia said it had intercepted four drones and Abu Dhabi said it had intercepted a missile, with minor damage near an economic zone.

The U.S. embassy in Baghdad urged its citizens to leave Iraq, warning of attacks in the capital by Iran-allied militia in the next 24 to 48 hours.

Fuel shortages have already caused economic strains across Asia and they are expected to bite in Europe soon. Italy's foreign minister said migration flows would increase if the conflict were to drag on.

Benchmark Brent crude prices jumped by about 8% to around $109 per barrel and stocks took a hit, with little reassurance from Trump's address about how the strait would reopen.

"The key question in all investors' minds is 'When is this going to be over?'" said Russel Chesler, Head of Investments and Capital Markets at VanEck Australia.

The International Monetary Fund, World Bank and International Energy Agency on Wednesday warned the war was having "substantial, global and highly asymmetric" effects and said they would coordinate their response, including through potential financial support to those countries hit hardest.

PROSPECTS ELUSIVE FOR NEAR-TERM RESOLUTION

In an interview with Reuters on Wednesday before his speech, Trump said U.S.-Israeli strikes had ensured Iran would not obtain nuclear weapons, adding that U.S. forces could return with "spot hits" if the threat resurfaces.

"We are systematically dismantling the regime's ability to threaten America or project power outside of their borders," he said.

Prior to Trump's remarks, Iranian President Masoud Pezeshkian said in a letter addressed to the American people that his country harbours no enmity towards ordinary Americans.

Trump said discussions were ongoing with Iranian leaders he considered less radical than previous leaders.

A senior Iranian source told Reuters on Wednesday that Tehran is demanding a guaranteed ceasefire to halt its attacks and said no talks have taken place through intermediaries on a temporary truce.

U.S. Vice President JD Vance communicated with Pakistani intermediaries about the Iran conflict as recently as Tuesday, according to a source briefed on the matter, making clear Trump was open to a ceasefire if certain demands were met.

Pakistan, which has good relations with the U.S. and Iran, had said it hoped to host direct talks between the warring sides soon but its foreign ministry spokesperson said on Thursday there was no confirmation so far of any U.S. plans to attend.

Posted by: Alma Angeles/NET25 News