Oil prices spiked during early Asian trading on Monday after US President Donald Trump rejected Iran's proposal to end the Middle East conflict and reopen the Strait of Hormuz.
WTI crude oil futures for November delivery rose 1.69% to $94.10 per barrel, while Brent crude climbed 2.65% to $106.96 per barrel.
Trump confirmed he had rejected Tehran's latest proposal, in which Iran offered to reopen the Strait of Hormuz and resume nuclear negotiations with Washington within seven days, provided certain conditions were met.
Iranian Foreign Minister Abbas Araghchi stated that these conditions included a halt to US military actions, the lifting of naval and economic sanctions, and the release of Iranian assets.
Strait of Hormuz Back in Market Focus
Uncertainty regarding the reopening of the Strait of Hormuz has heightened concerns over oil supply disruptions. This key shipping lane has become a focal point for the market amidst the ongoing conflict between the US and Iran.
Tension risks also escalated after the Saudi-led coalition in Yemen announced on Saturday that it had intercepted a projectile launched by Iran-backed Houthi rebels.
These developments have caused the market to once again factor in the risk of energy supply disruptions should the conflict drag on.
Trump had previously stated he expected the conflict—which began with US and Israeli airstrikes on Iran on February 28—to conclude after the midterm elections, with oil prices expected to fall thereafter.
