Brent crude prices surged around 4% on Monday after U.S. President Donald Trump rejected an Iranian proposal to reopen the Strait of Hormuz.
Brent crude reached $108.48 a barrel at 6:35 a.m. ET, while U.S. West Texas Intermediate (WTI) futures rose 4% to $96.16 a barrel.
Trump confirmed that he had rejected the proposal, saying, “They made a proposal but I rejected it.”
Iranian Foreign Minister Abbas Araghchi had presented the proposal at the United Nations General Assembly in New York. Under the proposal, Iran would reopen the Strait of Hormuz and resume nuclear talks within seven days if the United States halted military strikes, lifted its naval blockade and economic sanctions, and released Iranian assets.
Araghchi said Iran had not yet received a formal response through the mediation process, with Qatar acting as an intermediary.
The development has increased concerns over a renewed escalation between the United States and Iran and its potential impact on global energy markets.
The Strait of Hormuz is a major global oil shipping route. Before the current conflict, around one-fifth of global oil supplies passed through the waterway each day.
Commercial shipping through the strait has declined since the conflict began. However, maritime traffic increased to 132 vessel passages between September 21 and 27, compared with 116 the previous week, according to MarineTraffic.
Energy markets are now closely watching developments between Washington and Tehran amid concerns over the possible resumption of hostilities.
