Iran is ready for a more intense war and will escalate counterstrikes if the United States continues attacking its territory and infrastructure, according to a senior official from the Islamic Republic.

Tehran has no intention of backing down in the face of an American naval blockade and attacks on its oil tankers, said the official, who asked not to be identified discussing sensitive matters. Economic pain may be increasing, they said, but the country’s leaders see the war with the U.S. as posing an existential threat that leaves them little choice but to keep fighting.

The comments come as hostilities between the U.S. and Iran show little sign of easing, with the war now into its seventh month. Overnight, Washington said one of its warships had to evade an Iranian attack, and that it destroyed five of the Islamic Republic’s energy tankers in response. Tehran then fired around 20 missiles at a Jordanian airbase used by the U.S. and attacked more American Navy ships, as well as several commercial vessels.

On Wednesday, President Donald Trump downplayed concerns about rising oil prices and a war he said would be over in weeks. He persisted in presenting Iran as incapacitated, telling reporters that “I think the war is going to end immediately after the election because they can’t hold out any longer.” The midterm congressional elections are in November.

The senior Iranian official said the country has been rebuilding its military capabilities since the most intense period of the war ended in April and has enough missiles for a lengthy conflict.

The tit-for-tat attacks have pushed up energy prices, with Brent crude climbing above $100 a barrel Wednesday and extending its gain this year to around 65%. U.S. diesel pump prices hit a record last week, adding to pressure on Trump to end a conflict that’s unpopular with voters ahead of midterm elections on Nov. 3.

Many of Iran’s leaders “believe the Trump administration responds only to threats and escalation,” Dina Esfandiary of Bloomberg Economics wrote. “They also think the administration is more sensitive to an escalating war in the lead-up to the midterm elections.”

This week, Iran’s new security chief, Mohsen Rezaee, said its military posture toward U.S. ships and bases had been “fundamentally recalibrated,” signaling a more aggressive stance.

Mohammad Bagher Ghalibaf, the speaker of parliament and lead negotiator with the U.S. in previous ceasefire talks, warned the era of “proportionate responses” was over.

Earlier Wednesday, Iran’s semi-official Fars News Agency reported explosions were heard off the coast of Jask near the Strait of Hormuz around 7:20 p.m. local time. A U.S. official said the U.S. military was not responsible for the reported explosions.

The war, which erupted when the United States and Israel began strikes on Iran in late February, has entered a stalemate of sorts, with both sides jockeying for control over the Strait of Hormuz. No official peace talks have been held for months and there’s little sign of the sides returning to the negotiating table.

The U.S., wary of fuel prices going up even more, and having used up a significant portion of its interceptor missiles, is trying to avoid a return to the full-on fighting of March and early April. Instead, it’s trying to squeeze Iran’s economy via the blockade and threats to penalize governments and companies that don’t cut ties with Tehran.

Its aim is to force Iran to reopen Hormuz and restart negotiations to end the conflict.

Iran continues to insist it has the right to manage traffic through the vital waterway and is regularly targeting ships that pass through without its permission. That is forcing the U.S. to respond militarily and raising the risk of an escalatory spiral.

The blockade is hurting the Iranian economy. With Tehran hardly able to export petroleum and import many vital goods, inflation has accelerated to almost 90% and the rial is depreciating rapidly. Economic pressures led to mass protests late last year, triggering a crackdown by authorities that killed thousands of people.

The Iranian official acknowledged the worsening economic pain. Still, they said the country’s leaders believe they have little choice but to keep fighting until they’re confident Washington will be too wary to attack again in future.

Some Iranian officials, including President Masoud Pezeshkian, have said their country should negotiate with the U.S. to ease the economic pressures. Yet even they say the White House must first lift the blockade and go back to the terms of the so-called Memorandum of Understanding, a ceasefire deal signed in June but which rapidly broke down.

“The political elites are locked in a debate over whether to escalate or just resist,” said Esfandiary. “Despite the debate, Iran is deciding how to retaliate faster and more efficiently, suggesting it has developed a menu of responses to US escalation. It seeks to impose greater costs on the U.S.”

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(With assistance from Courtney McBride and Hadriana Lowenkron.)

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