Oil prices jumped sharply on Monday after Iran suspended talks with the United States, escalating tensions tied to the Israel-Lebanon conflict.
Brent crude rose to $95.60 per barrel, while West Texas Intermediate climbed to $92.49, marking their strongest daily gains in weeks.
The surge followed reports that Tehran halted indirect negotiations with Washington after accusing Israel of violating ceasefire terms in Lebanon.
Iran also warned it could close the Strait of Hormuz, a critical global oil route through which about 20% of the world’s oil supply passes.
Conflict Escalation And Oil Market Shock
Iran’s decision came after Israeli strikes in southern Beirut and fresh U.S. military action targeting drone sites in southern Iran.
The U.S. Central Command said the strikes were in response to Iran downing an American drone over international waters.
Iranian officials linked the suspension of talks to continued hostilities in Lebanon.
“Considering that Lebanon was one of the preconditions for the ceasefire… the Iranian negotiating team is suspending dialogues.”
Tehran also signalled a tougher stance on the conflict.
“Iran and the Axis of Resistance have resolved to pursue the complete closure of the Strait of Hormuz.”
The Strait is a vital shipping lane, and any disruption could significantly impact global energy markets and fuel prices.
Conflicting Signals On Diplomacy
Despite Iran’s position, U.S. President Donald Trump said negotiations were still ongoing.
“Talks are continuing, at a rapid pace, with the Islamic Republic of Iran.”
He also referenced a conversation with Israeli Prime Minister Benjamin Netanyahu.
“I had a very productive call… and there will be no Troops going to Beirut.”
However, Iran’s leadership maintained that any ceasefire violation invalidates the entire agreement.
“Its violation on one front is a violation of the ceasefire on all fronts.”
Officials in Tehran also accused the U.S. of failing to restrain Israeli actions and maintaining pressure through sanctions and military presence.
The standoff reflects a widening regional crisis involving Iran, Israel, Hezbollah, and the United States.
With key shipping routes under threat and diplomacy uncertain, global markets remain on edge as investors react to every shift in the conflict.
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