Global oil prices jumped sharply on Monday after President Donald Trump bluntly rejected Iran’s response to the latest U.S. peace proposal, the Associated Press reported, injecting fresh uncertainty into a conflict that has upended energy markets since late February. Trump’s message on social media, in which he called Iran’s counterproposal “totally unacceptable,” came as the Strait of Hormuz — the narrow passage through which roughly a fifth of global oil supplies flow — remains largely blocked by the ongoing U.S. naval blockade.
The rejection sent Brent crude, the international benchmark, up 2.6% to $103.88 per barrel, while U.S. benchmark crude gained 2.5% to $97.78. Oil prices have soared roughly 50% since the war began in late February, when Brent was trading around $70. Analysts expect elevated prices to persist as long as the strait — and Iranian ports — remain effectively shut.
“There remains a glimmer of hope that talks between Trump and Chinese President Xi later this week could yield positive results on Iran,” wrote commodity analysts Warren Patterson and Ewa Manthey of ING in a Monday note. “It is expected that China could use its influence on Iran to bring it closer to a peace agreement,” they added, while cautioning that “this is easier said than done.” The oil market continues to be “very headline-driven,” they said.
The war with Iran is expected to feature prominently when Trump meets Xi later this week. China, which maintains close economic ties with Iran, has faced U.S. pressure to leverage its relationship to help reopen the Strait of Hormuz.
Global stock markets were mixed on Monday. In Asia, South Korea’s Kospi surged 4.3% to an all-time high of 7,822.24, buoyed by tech-related shares such as Samsung Electronics and SK Hynix. The index has gained more than 30% over the past month, even amid the war. Japan’s Nikkei 225 slipped 0.5% to 62,417.88 after touching a fresh intraday record above 63,300, with SoftBank Group weighing on the index. Australia’s S&P/ASX 200 fell 0.5%, while Hong Kong’s Hang Seng inched up less than 0.1% and the Shanghai Composite rose 1.1% to 4,225.02 after official data showed factory-gate prices in China climbed 2.8% in April from a year earlier, the highest since 2022, and weekend data pointed to better-than-expected exports.
In early European trading, Britain’s FTSE 100 added 0.2% to 10,253.99, Germany’s DAX was nearly flat at 24,328.17, and France’s CAC 40 lost 0.8% to 8,049.31.
Wall Street had set fresh records on Friday after a stronger-than-expected U.S. jobs report defied the drag from the Iran war. The benchmark S&P 500 rose 0.8% to 7,398.93, the Dow Jones Industrial Average edged up less than 0.1% to 49,609.16, and the tech-heavy Nasdaq Composite jumped 1.7% to a record 26,247.08.
In currency markets, the U.S. dollar strengthened to 157.14 Japanese yen from 156.61 yen, while the euro slipped to $1.1766 from $1.1780.