WHAT YOU NEED TO KNOW
  • Brent crude rose 2.3% to $106.73 per barrel, while West Texas Intermediate gained 2% to $94.25.
  • Trump rejected Iran’s conditional proposal to reopen the Strait of Hormuz and restart nuclear negotiations within seven days.
  • The Wall Street Journal reported that Trump expects U.S. strikes on Iran to resume after November’s midterm elections.
  • Cornelia Meyer said countries are relying on inventories as markets price renewed hostilities between the U.S. and Iran.

DISCLAIMER: GoldInvestors.news is not a registered investment, legal or tax advisor or broker/dealer. All investment/financial opinions expressed by GoldInvestors.news are from the personal research and experience of the owner of the site and are intended as educational material. Although best efforts are made to ensure that all information is accurate and up to date, occasionally unintended errors and misprints may occur.

Oil prices climbed Monday after U.S. President Donald Trump rejected Iran’s conditional proposal to end the Middle East conflict and reopen the Strait of Hormuz. The decision renewed concerns about the strategically important shipping route and the possibility of further hostilities.

International benchmark Brent crude futures rose 2.3% to $106.73 per barrel at 10:33 a.m. ET. Brent had reached as high as $108.83 earlier in the session before surrendering part of that advance.

U.S. West Texas Intermediate futures were last trading 2% higher at $94.25. The gains in both benchmarks followed the latest developments surrounding Iran’s offer and Trump’s response.

The Wall Street Journal reported Saturday that Trump had rejected Iran’s conditional offer to reopen the Strait of Hormuz. The newspaper cited unnamed U.S. officials familiar with the matter.

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According to the report, Trump also told aides that he expects U.S. strikes on Iran to resume after the midterm elections in November. Trump later confirmed to reporters that he had turned down Tehran’s latest proposal.

“They made a proposal but I rejected it,” Trump said. His rejection left Iran’s proposed reopening of the Strait of Hormuz contingent on demands that Washington had not accepted.

Iranian Foreign Minister Abbas Araghchi presented the offer Friday while attending the United Nations General Assembly in New York. He said Iran would reopen the important shipping route and restart nuclear negotiations with Washington within seven days if the Trump administration agreed to Tehran’s conditions.

“If certain conditions are met, the Strait of Hormuz will be open at the end of seven days, and talks will be restarted,” Araghchi told reporters on the sidelines of the gathering. His comments laid out a specific timeline while making action dependent on Washington’s response.

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Iranian foreign ministry spokesman Esmaeil Baghaei described the conditions attached to Tehran’s proposal. They include an end to what Iran calls U.S. “acts of aggression,” along with the lifting of the naval blockade and economic warfare.

Tehran also demanded the release of Iranian assets, according to Baghaei. Trump’s rejection prevented the conditional proposal from becoming a path toward reopening the shipping route and restarting negotiations.

Separately, Yemen’s coalition led by Saudi Arabia said Saturday that it had intercepted projectiles launched by Houthi rebels supported by Iran. The announcement added another development to the regional conflict as energy markets focused on the risk of renewed hostilities.

The conflict began with U.S. and Israeli airstrikes on Iran on Feb. 28. Trump said earlier this month that he expected the conflict to conclude soon after the November midterm elections, and oil prices subsequently declined.

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Energy market participants are now pricing in what Cornelia Meyer, CEO of Meyer Resources, called a “clear and present danger” that hostilities between the U.S. and Iran could return after the midterm elections. That concern followed Trump’s rejection of Iran’s offer and the report about possible renewed strikes.

Meyer said countries relying on stored supplies face an increasingly difficult position if the conflict continues. Her comments pointed to inventories as a central concern for governments and market participants watching available barrels.

“I think everybody hopes that this is not the case because, you know, we are living off borrowed barrels. A lot of countries are living off their inventories,” Meyer told CNBC’s “Access Middle East” on Monday.

Monday’s price action reflected the market’s response to the unresolved dispute over the Strait of Hormuz. Brent and West Texas Intermediate both remained higher after Trump confirmed he had rejected the Iranian proposal.

The Iranian plan linked the reopening of the waterway and renewed nuclear talks to several demands directed at Washington. With those conditions rejected, traders continued to confront the prospect of further U.S. strikes after November’s elections and prolonged pressure on available oil inventories.

DISCLAIMER: GoldInvestors.news is not a registered investment, legal or tax advisor or broker/dealer. All investment/financial opinions expressed by GoldInvestors.news are from the personal research and experience of the owner of the site and are intended as educational material. Although best efforts are made to ensure that all information is accurate and up to date, occasionally unintended errors and misprints may occur.