Global oil markets experienced turbulent trading on Monday as US President Donald Trump escalated threats against Iran, demanding the reopening of the Strait of Hormuz or promising attacks on critical infrastructure.
“Tuesday will be Power Plant Day, and Bridge Day, all wrapped up in one, in Iran. There will be nothing like it!!! Open the Strait, you crazy bastards, or you’ll be living in Hell JUST WATCH!” Trump wrote on Truth Social.
The strait is a vital artery for global energy, carrying roughly 20 percent of the world’s oil shipments, and Tehran has threatened retaliation against vessels passing through in response to US and Israeli airstrikes since February 28.
Oil initially surged past $110 a barrel for Brent crude before easing after reports emerged of preliminary US-Iran talks over a potential ceasefire.
“Oil prices will remain volatile and swing with each headline of the war’s escalation and easing,” said Sushant Gupta, energy analyst at Wood Mackenzie. “The focus remains on whether energy shipments from the Gulf can resume to ease a supply shortage that has impacted countries around the world.”
According to Axios, the US, Iran, and a group of regional mediators are reportedly discussing a 45-day ceasefire, which could pave the way for a permanent end to the conflict. Neither the White House nor BBC News had independently verified the report.
Meanwhile, the Iranian Revolutionary Guard Corps (IRGC) warned that attacks against US economic interests would intensify if civilian infrastructure in Iran continues to be targeted.
“The gates of hell will open” for the US, said Gen Ali Abdollahi Aliabadi, responding to President Trump’s threats. He described the US deadlines as “helpless, nervous, unbalanced and stupid.”
The conflict’s impact on global oil supply is compounded by OPEC+’s limited May production increase of 206,000 barrels per day, which analysts warn is largely symbolic as key members cannot boost output due to ongoing tensions.
“Disruption to shipping in the narrow waterway has pushed up the price of energy around the world and raised concerns about higher inflation globally,” market analysts noted.
As oil prices remain sensitive to every development, traders and governments are closely monitoring the situation in the Gulf, aware that the outcome of US-Iran negotiations could have wide-reaching effects on the global economy.
