Oil prices extended gains on Monday after US President Donald Trump reiterated a deadline for Iran to reopen the Strait of Hormuz, raising concerns of further escalation in the ongoing conflict. US West Texas Intermediate crude futures rose more than 2% to trade above $112 per barrel, while Brent crude climbed over 1% to around $109 per barrel.
Markets reacted to renewed warnings from Trump, who said the United States could target Iran’s critical infrastructure, including power plants and bridges, if the Strait of Hormuz is not reopened by Tuesday.
The narrow waterway, a key global energy route, has seen disruptions since the conflict began in late February, triggering a supply shock and pushing up prices of crude oil and refined fuels worldwide.
Despite the tensions, some tanker movement has resumed through the strait. However, shipping activity remains significantly below normal levels, indicating continued constraints on global supply.
Reports suggest that the United States and Iran are engaged in discussions aimed at ending the conflict, though prospects for a ceasefire before the deadline remain uncertain. Iran has reportedly proposed broader conditions, including a permanent end to hostilities and sanctions relief, while Washington has signaled the proposal falls short.
Analysts say markets remain highly volatile amid uncertainty over whether the situation will de-escalate or intensify. The ongoing disruption has already tightened global energy supplies and increased pressure on fuel prices.
Experts also note that even if shipping fully resumes, it could take several months for supply flows to stabilize and reach key markets, particularly in Asia.
The Strait of Hormuz typically handles a significant share of global oil shipments, making it a critical chokepoint for energy markets.
The outcome of ongoing negotiations is expected to play a key role in determining the direction of oil prices in the coming weeks.
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