Iran launches missiles as Khamenei's son takes charge

Iran fired missiles at Israel and Gulf nations early on Monday after the Islamic republic named Mojtaba Khamenei its new leader to succeed his late father despite threats by the United States and Israel to target him next.

Nine days after US-Israeli strikes killed Ayatollah Ali Khamenei and plunged the Middle East into war, Iranian clerics picked the country's third supreme leader since the 1979 Islamic Revolution.

Israel launched a new wave of strikes, this time targeting infrastructure in central Iran, as the expanding war sent stocks plunging and crude prices surging 30 per cent on supply disruption fears.

Saudi Arabia intercepted drones headed for an eastern oil field, while the United Arab Emirates and Kuwait reported missile attacks and Bahrain said sirens were activated.

This image taken from video shows Mojtaba Khamenei, a son of Iran's slain supreme leader, who has been named as the Islamic Republic's next ruler, authorities announced on Monday. AP

Khamenei's appointment was announced on Iranian state television, with the presenter solemnly reading a statement from the 88-member Assembly of Experts next to a picture of the new 56-year-old leader.

Khamenei is appointed and introduced as the third leader of the sacred system of the Islamic Republic of Iran, based on the decisive vote of the respected representatives of the Assembly of Experts", the statement said.

It said the clerical body "did not hesitate for a minute" in choosing a new leader despite "the brutal aggression of the criminal America and the evil Zionist regime".

State media then showed a projectile said to be launched at Israel bearing the slogan, "At Your Command, Sayyid Mojtaba", using an Islamic honorific.

The war came weeks after Iranian security forces crushed nationwide protests against the government. The younger Khamenei is considered a fellow hardliner who will pursue his father's rejection of dissent.

US President Donald Trump had previously dismissed the Mojtaba Khamenei as a "lightweight", and insisted again on Sunday that he should have a say in appointing a new leader.

"If he doesn't get approval from us he's not going to last long," he told ABC News before the announcement was made.

Israel's defence minister has warned last week that the new supreme leader would become "a target", while the military vowed to go after any successor.

Oil price spikes

As Iran retaliates against its oil-rich Gulf Arab neighbours, the benchmark price for a barrel of crude soared beyond $100 for the first time since Russia's invasion of Ukraine four years ago.

An employee pumps gasoline into the vehicle of a customer at a gas station in Hanoi on Monday. AFP

Trump dismissed the price spike, a politically sensitive issue in the United States, as a "small price to pay" for removing the alleged threat of Iran's nuclear programme.

But markets across Asia, where key economies Japan and South Korea are heavily dependent on energy imports, plunged on Monday.

In a sign that the United States does not expect a quick end to the war, the State Department ordered non-emergency staff to leave Saudi Arabia, days after a drone hit the US embassy.

As questions swirl over the length of the war, Trump told the Times of Israel that any decision on when to end hostilities will be a joint one with Israel's Prime Minister Benjamin Netanyahu.

"I think it's mutual... a little bit. We've been talking. I'll make a decision at the right time, but everything's going to be taken into account," Trump said, in response to a question on whether he alone will decide.

Few expect major changes under the younger Khamenei, a trained cleric close to Iran's powerful military force the Islamic Revolutionary Guard Corps.

The Guards quickly pledged support for the new leader, who comes into the role with far less experience than his father -- a former president under the first supreme leader, Ayatollah Ruhollah Khomeini.

The Guards said in a statement they were "ready for complete obedience and self-sacrifice in carrying out the divine commands" of the new leader.

Foreign Minister Abbas Araghchi said the naming of the new leader will "guarantee national sovereignty and territorial integrity" as he led Iranian diplomats in declaring "our allegiance" to Khamenei.

Agence France-Presse