Oil Crisis Escalates: Trump Threatens Iran as Strait of Hormuz Closure Pushes Prices Above $110

Oil prices briefly surged past $110 per barrel on Monday after President Donald Trump escalated military and diplomatic pressure on Iran, demanding the reopening of the Strait of Hormuz by Tuesday evening or face strikes on Iranian power infrastructure. Trump's warning — delivered through social media and broadcast interviews — marked a sharp intensification of tensions that have rattled global energy markets for weeks.

Iran swiftly rejected the ultimatum, even as the Trump administration had previously set Monday as an earlier deadline for Tehran to negotiate and restore tanker traffic through the strait. The waterway serves as a critical artery for roughly 20% of the world's oil supply, and its continued closure has stoked fears of a new inflationary wave with potentially significant drag on global economic growth.

Brent crude futures, the internationally recognized oil benchmark, were last trading up 0.3% at $109.37 a barrel. That marks a dramatic climb from approximately $70 per barrel recorded just before the joint U.S. and Israeli military campaign against Iran began in late February. The conflict has triggered persistent supply concerns across energy-dependent industries worldwide.

European stock markets were closed Monday due to a public holiday, limiting broader market activity. However, traders remained on alert as geopolitical risks continued to dominate sentiment.

Despite the ongoing standoff, early signs of a potential diplomatic breakthrough emerged. Reuters reported that both Iran and the United States have received a framework proposal to end hostilities and restore navigation through the strait, with implementation potentially beginning as early as Monday. Additionally, Iran granted Iraq access to the strait over the weekend, continuing a pattern of selectively reopening the chokepoint for individual countries — a signal some analysts interpreted as a gradual softening of Tehran's position.