Global oil prices surged more than 4 percent on Monday after US President Donald Trump rejected Iran’s proposal to end the war.
Brent crude futures climbed by $4.16, or 4.11 percent, to $105.45 per barrel, while US West Texas Intermediate crude rose $4.38, or 4.59 percent, to $99.80 per barrel.
The sharp increase came after Trump described Iran’s response to Washington’s proposal as “totally unacceptable” in a social media post.
Iran’s proposal focused on ending the war across the region, particularly in Lebanon, and called for an end to sanctions, removal of the US naval blockade, and guarantees against future attacks. Tehran also stressed its sovereignty over the Strait of Hormuz.
The Strait of Hormuz remains largely blocked due to the war. Oil markets are reacting sharply to every development surrounding the war and diplomatic negotiations.
Saudi Aramco Chief Executive Amin Nasser recently said the world has lost nearly 1 billion barrels of oil supply over the past two months because of the war. He warned that global energy markets may take time to stabilize even if oil flows through the Strait of Hormuz resume.
Last week, oil prices had declined nearly 6 percent on hopes that a ceasefire agreement could reopen shipping routes and ease supply concerns. However, renewed uncertainty surrounding negotiations has once again pushed markets higher.
