Oil prices jumped sharply on Monday after Iran suspended indirect negotiations with the United States and threatened to fully block the Strait of Hormuz, raising fears of a major disruption to global energy supplies.
WTI crude futures surged more than 7% in early trading to $94.10 per barrel as traders reacted to escalating tensions in the Middle East and the growing risk of supply disruptions from one of the world's most critical oil transit routes.
According to Iran's state-affiliated Tasnim News Agency, Tehran has halted all indirect message exchanges with Washington through intermediaries, citing continued Israeli military operations against Hezbollah in Lebanon and ongoing attacks in Gaza.
Iranian officials said no dialogue with the United States would take place until Israel completely withdraws from occupied areas in Lebanon and ends its military operations in both Lebanon and Gaza.
The report also stated that Iran and the so-called "Resistance Front" have agreed to pursue a complete closure of the Strait of Hormuz while activating additional pressure points, including the Bab el-Mandeb Strait, in what Tehran described as a response to Israeli actions and support from its allies.
Iran views the recent Israeli strikes on Hezbollah as a violation of the April 8 ceasefire framework involving the United States. Iranian Foreign Minister Seyed Abbas Araghchi warned that any breach of the ceasefire in Lebanon should be considered a violation across all fronts.
"A ceasefire between Iran and the United States constitutes a comprehensive ceasefire across all fronts, including Lebanon," Araghchi wrote on social media. "Any violation on one front shall be considered a violation across all fronts."
The latest escalation comes just days after President Donald Trump said he would consider a potential agreement with Iran during a White House Situation Room meeting. However, no final decision was reached, and subsequent military exchanges between the U.S., Iran, and regional proxies have further weakened an already fragile ceasefire.
The Strait of Hormuz remains one of the world's most important energy chokepoints, handling roughly one-fifth of global oil shipments. Any attempt to restrict traffic through the waterway would likely send shockwaves across global energy markets and increase geopolitical risks worldwide.
With diplomacy appearing to break down and threats against key shipping lanes intensifying, investors are once again pricing in the possibility of a broader regional conflict and a significant disruption to global oil supplies.