Oil Prices Surge to $104 as US-Iran Talks Collapse

Global oil prices surged to $104 per barrel on Monday after peace talks between the United States and Iran collapsed, raising fears of renewed hostilities in the Middle East.

US President Donald Trump said a ceasefire was “on life support” after rejecting Tehran’s response to a US proposal.

“I would call it the weakest right now, after reading that piece of garbage they sent us. I didn’t even finish reading it,” he told reporters.

Iran’s response reportedly demanded compensation for war damage, recognition of sovereignty over the Strait of Hormuz, an end to the US naval blockade, lifting of sanctions, and removal of restrictions on Iranian oil sales.

The US proposal had focused on halting fighting before addressing more contentious issues, including Iran’s nuclear programme.

Iran’s Foreign Ministry spokesperson Esmaeil Baghaei defended its stance, saying, “Our demand is legitimate… safe passage through the Strait of Hormuz and establishing security in the region and Lebanon were other demands of Iran, which are considered a generous and responsible offer.”

The deadlock has kept the Strait of Hormuz under severe pressure. The narrow waterway, which carries about 20% of global oil and LNG shipments, has become a flashpoint since the war began on February 28, when crude traded below $70.

Shipping data showed tankers are increasingly switching off trackers to avoid Iranian attacks. On Sunday, two very large crude carriers — Agios Fanourios I and Kiara M — each carrying 2 million barrels of Iraqi crude, passed through the strait.

The Agios Fanourios I, bound for Vietnam’s Nghi Son Refinery, had failed to transit the strait twice since loading Basrah crude in April, underscoring the risks facing global energy flows.

Analysts warn that continued stalemate could prolong energy market volatility, with Brent crude futures already up 2.7% on Monday amid fears of further supply disruptions.