Global oil prices experienced a sharp spike in early Monday trading across Asian markets, driven by escalating tensions between the United States and Iran over the strategically vital Strait of Hormuz.
Brent crude futures surged by 6.4% to reach $96.13 per barrel, while West Texas Intermediate (WTI) crude climbed 7.5% to $90.15. This dramatic increase follows a significant drop in prices just days earlier, when Iran announced the strait would remain "completely open" to commercial vessels during the ongoing ceasefire period.
Energy markets have been characterized by extreme volatility since late February, when U.S. and Israeli military actions against Iran prompted Tehran to threaten shipping routes through the narrow waterway. Approximately one-fifth of the world's oil and liquefied natural gas (LNG) supplies transit through the Strait of Hormuz, making any disruption a major concern for global energy security.
On Sunday, President Donald Trump announced that U.S. forces had intercepted and seized an Iranian-flagged cargo ship attempting to bypass the American blockade of Iranian ports. The incident occurred as diplomatic efforts appeared to be in motion, with Trump stating that U.S. representatives would travel to Pakistan on Monday for negotiations. A White House official confirmed that Vice-President JD Vance would lead the American delegation.
However, Iran's state media quickly responded that Tehran had "no plans for now to participate" in the proposed talks. Iranian officials have yet to provide further clarification on the country's official position regarding the negotiations or the seized vessel.
The Strait of Hormuz remains one of the world's most critical maritime chokepoints, and any sustained disruption could have profound implications for global energy prices and economic stability.
The recent price fluctuations underscore the market's sensitivity to geopolitical developments in the region, with traders closely monitoring both military actions and diplomatic communications between Washington and Tehran.