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U.S. President Donald Trump is on a screen reflected in a window in New York's Times Square on Jan. 8, 2020.

MIKE SEGAR/Reuters

U.S. President Donald Trump is vowing to impose “punishing economic sanctions” on Iran after the country fired ballistic missiles at American forces in Iraq, but stopped short of announcing further military retaliation.

Neither side on Wednesday seemed willing to escalate the violence after Iran’s attack – retribution for Mr. Trump’s order to kill a top Iranian general last week – raising hopes that the crisis could pass without erupting into full-scale war.

“Our missiles are big, powerful, accurate, lethal and fast,” the President said at the White House. “The fact that we have this great military and equipment, however, does not mean we have to use it. We do not want to use it.”

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Mr. Trump called on NATO to become “much more involved in the Middle East” and warned that Iran’s support for terrorism “will not be tolerated any longer.” But he said Tehran “appears to be standing down” after firing 22 missiles at the Erbil and al-Asad bases, that there were no casualties in the attacks and damage to the bases was “minimal.”

The relatively measured comments were a change in tone after days of escalating threats since Mr. Trump ordered a drone attack at the Baghdad airport last week to kill General Qassem Soleimani.

Mr. Trump said he is continuing to “evaluate other options” for dealing with Iran. And it was unclear whether the bloodless bombardment would satisfy Tehran’s desire for retribution.

Meanwhile, congressional opposition to Mr. Trump’s fight with Iran continued to mount, with some members of the President’s Republican Party joining with Democrats to back a resolution that would rein in his war-making powers.

Mr. Trump has claimed that Gen. Soleimani had to die to prevent an imminent attack on Americans, but has provided no details or evidence. Closed-door briefings by administration officials on Wednesday failed to persuade many lawmakers Mr. Trump had a good reason to kill Gen. Soleimani or any plan to handle the fallout.

“Drive-by notification or after-the-fact lame briefings like the one we just received aren’t adequate,” said Mike Lee, a Republican Senator from Utah. “I find it insulting. I find it demeaning … it’s un-American, it’s unconstitutional and it’s wrong.”

Senator Rand Paul, a Kentucky Republican, also said he would vote against the President.

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Democratic House of Representatives Speaker Nancy Pelosi said she would hold a vote on Thursday on the motion to curb Mr. Trump’s ability to fight Iran. A similar motion is before the Senate. “The President has made clear that he does not have a coherent strategy to keep the American people safe, achieve de-escalation with Iran and ensure stability in the region,” she said in a statement.

Mr. Trump could veto the measure if it passes both chambers. Congress would need a two-thirds majority to override him.

U.S. vs. Iran: A guide to the story since Qassem Soleimani’s death

Iran’s Supreme Leader Ali Khamenei, in an address to his country on Wednesday, rejected Mr. Trump’s call for a new “deal” between the two countries on Tehran’s nuclear program. Mr. Trump announced a U.S. pull-out from a previous deal in 2018 that he said wasn’t tough enough on Iran.

Mr. Trump released no details of the new sanctions he planned to impose. Iran is already subject to a host of U.S. restrictions meant to choke off business investment in the country and punish top Iranian officials.

The President also spoke with NATO Secretary-General Jens Stoltenberg. According to a NATO summary of the call, the pair agreed the alliance “could contribute more to regional stability and the fight against international terrorism.” Mr. Trump frequently complains that other countries do not do their share in NATO.

Prime Minister Justin Trudeau confirmed Canadians were at the Erbil base during the attack, but none were hurt. Thirty members of a Canadian helicopter unit are based at Erbil. Mr. Trudeau called for de-escalation, but would not weigh in on the U.S. decision to take out Gen. Soleimani. “The Americans made a decision based on their threat assessment,” he said.

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Evidence, meanwhile, emerged that Iran deliberately tried to avoid inflicting casualties during the missile strikes. The office of Iraqi Prime Minister Adil Abdul-Mahdi said in a statement that Tehran had warned it about the attack before it started.

Amos Yadlin, a former head of Israeli military intelligence, described the missile attacks as a “well-calibrated, cautious retaliation.” He said Iran will probably now focus on political goals, including pressure to force the withdrawal of U.S. troops from Iraq.

“War is not the target of either side in the conflict," Mr. Yadlin, executive director of the Institute for National Security Studies at Tel Aviv University, said in an interview with The Globe and Mail. "Iran knows the real balance of power, and the United States in an election year doesn’t want a war either. Both sides are trying to avoid an escalation.”

Mr. Yadlin contended that the greatest risk now is a miscalculation by Iran or the U.S. that leads to more casualties than expected. In the past, Iranian intentions were difficult to decipher. But today, with the unpredictable and volatile Mr. Trump at the helm, it is more difficult to forecast U.S. actions than Iranian actions, he said.

On the ground on Wednesday, there were signs the conflagration may not be over.

U.S. President Donald Trump said on Wednesday Iranian missile strikes on bases in Iraq had not harmed any U.S. troops stationed there and damage was minimal. Reuters

Two rockets fell in Baghdad’s Green Zone, which houses government buildings and foreign embassies, Reuters reported. There were no casualties, and no one immediately claimed responsibility.

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Iranian-backed Iraqi military commander Qais al-Khazali said he would retaliate against the U.S. for the death of fellow terrorist leader Abu Mahdi al-Muhandis in the drone strike that took out Gen. Soleimani.

“Iraqis are brave and zealous, their response will not be any less than that or Iran’s. That is a promise,” Mr. al-Khazali tweeted.

Such threats raise the possibility that Iran will shift away from conventional military tactics and authorize terrorist attacks by its radical militia allies.

Luciano Zaccara, an expert on Iranian politics at the University of Qatar, said he couldn’t see the U.S.-Iran conflict ending even if Mr. Trump decided not to reply militarily.

“I don’t think this is over. This is not proportionate [for the killing of Gen. Suleimani] – proportionate would be to kill someone significant or to really harm the United States,” Prof. Zaccara said. “If this is it, this is a victory for Trump, but I don’t think Iranians will accept this.”

Prof. Zaccara said claims in Iranian state media that 80 Americans were killed in Wednesday’s attacks may signal an effort to tell Iranians revenge was achieved. “I don’t know how long they can keep up the lie," he said.

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In Kuwait, a small country of the Gulf Coast that borders Iraq, people were feeling nervous, but there was no sense of disruption. Bases in Kuwait house U.S. and some Canadian troops.

“I think there is some tension,” said Alia Mandani, a 30-year-old Kuwaiti civil servant. But she said people in the country have heard Iran and the U.S. exchange rhetoric for years without it leading to war.

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