Oil prices jumped about $3 a barrel on Monday after the United States and Iran failed to agree on a Washington-drafted peace proposal, leaving the Strait of Hormuz largely closed and global supplies tight.
Brent crude futures climbed $3.18, or 3.14%, to $104.47 a barrel by 23:36 GMT Sunday, extending Friday’s 1.23% gain. US West Texas Intermediate rose $3.09, or 3.24%, to $98.51.
Hopes of an imminent end to the 10-week US-Iran conflict were dashed after President Donald Trump on Sunday dismissed Iran’s response to the US peace proposal as “unacceptable.” The plan, delivered to Tehran through Pakistani diplomats, called for a 12-year halt to uranium enrichment in return for staggered sanctions relief.
Trump is scheduled to arrive in Beijing on Wednesday and is expected to discuss Iran with Chinese President Xi Jinping. “Market attention now shifts squarely to President Trump’s visit to China this week,” IG market analyst Tony Sycamore said in a note. “There is hope he can persuade Beijing to leverage its influence over Iran to push for a comprehensive ceasefire.”
Saudi Aramco CEO Amin Nasser said on Sunday the world has lost about 1 billion barrels of oil over the past two months, and energy markets will take time to stabilise even if flows resume. Two tankers laden with crude exited the Strait of Hormuz last week with trackers switched off to avoid Iranian attacks.
The renewed price surge keeps Sri Lanka’s fuel-import costs elevated as the CBSL reported it turned net dollar seller in April for the first time in 22 months. The current diplomatic ring connects Iran’s response delivered via Pakistan, Trump’s weekend rejection and Aramco’s one-billion-barrel supply gap.
