Story
Brent Crude Surpasses $106 as Trump Rejects Iran's Hormuz Reopening Proposal
Summary
Oil prices climbed after U.S. President Donald Trump rejected a seven-day proposal from Iran to reopen the Strait of Hormuz, prolonging a standoff that has pushed the global benchmark up over 70% this year.
Brent crude futures rose above $106 a barrel after U.S. President Donald Trump rejected a proposal from Iran for a seven-day reopening of the Strait of Hormuz, signaling a potential delay in restoring traffic through the critical waterway. The U.S. benchmark, West Texas Intermediate (WTI), neared $94 per barrel amid the heightened geopolitical tension.
Diplomatic Stalemate
In an interview with Axios on Sunday, President Trump stated that while Iran's proposed terms might have been acceptable about a year ago, Tehran is now overestimating its leverage. The rejection prolongs a conflict that has entered its eighth month.
Despite the firm stance, Trump expects negotiations to resume this week, Axios reported. The diplomatic uncertainty follows a volatile week for oil markets, which were swayed by mixed signals on supply flows and potential U.S. measures to curb record-high diesel prices. Trump confirmed that Washington is “very seriously” considering such measures.
Market Impact
The ongoing disruption has had a significant impact on global energy markets. Brent crude is on track for its third consecutive monthly gain and has surged over 70% this year, intensifying global inflationary pressures.
AdTraders are closely monitoring the actual flow of traffic through the Strait of Hormuz, which handles approximately one-fifth of the world's crude oil and liquefied natural gas (LNG). Conflicting reports have emerged, with Trump claiming a “record amount” of oil transited the strait on Saturday night, while Iran's Fars News Agency reported that its forces had targeted vessels using unauthorized shipping lanes.
Broader Regional Tensions
Instability in the wider region continues to support a risk premium in oil prices. On Saturday, the Saudi-led coalition in Yemen announced its air defense systems had intercepted Houthi drones targeting Riyadh and a missile aimed at the southern city of Khamis Mushait.
Alerts were also issued in Abha and Jizan, where energy giant Saudi Aramco operates key facilities. These incidents underscore the persistent security risks to energy infrastructure in the Middle East.
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