Oil prices surged on Monday after President Donald Trump dismissed Iran’s response to the latest US peace proposal as “TOTALLY UNACCEPTABLE,” reigniting fears over supply disruptions and pushing crude back above the $100 per barrel mark.
Trump posted on social media that he had read Iran’s response and did not like it, a statement that ended a three-day losing streak for oil prices and reversed the brief optimism that had driven Brent and WTI down more than 6% last week.
Brent crude futures climbed more than 4% to around $105 per barrel, while US West Texas Intermediate futures rose to roughly $100 per barrel in early trading.
The Strait of Hormuz has remained largely closed throughout the 10-week conflict, keeping global oil markets tight and making prices acutely sensitive to any diplomatic developments.
Israeli Prime Minister Benjamin Netanyahu added to the pressure by warning over the weekend that the conflict with Iran was “not over,” further stoking fears that military escalation could intensify.
Iran continued drone attacks on Gulf neighbours over the weekend, with the UAE intercepting two Iranian drones, Qatar condemning a strike on a cargo ship in its waters, and Kuwait reporting hostile drone incursions into its airspace.
ANZ analysts wrote in a note that even if the acute oil shock fades by late 2026, the ongoing risk of renewed disruption in the Strait of Hormuz would keep a geopolitical risk premium embedded in prices, with Brent expected to remain above $90 per barrel through the year.
Saudi Aramco CEO Amin Nasser said on Sunday that the longer shipping disruptions continue, the more prolonged the oil supply constraints could be, potentially extending the situation into next year.
Analysts noted that a credible and sustainable peace deal could immediately send crude below $80 per barrel, while a worst-case escalation scenario could briefly push Brent toward $120 to $140 before demand destruction set a ceiling.
China’s inbound oil shipments fell to their lowest level in nearly four years in April, official data released over the weekend showed, reflecting the broader impact of the supply disruption on the world’s largest crude importer.
