US oil benchmark jumps 8%, surpasses $100 after failed US-Iran talks
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Oil prices surge above $100 after US-Iran talks collapse and tensions escalate in the Strait of Hormuz.
Global energy markets were thrown into sharp turmoil Sunday evening as West Texas Intermediate (WTI) crude futures surged more than 8%, pushing prices above the $100-per-barrel threshold following the breakdown of high-stakes US-Iran negotiations in Pakistan.
The talks, which reportedly lasted 21 hours in Islamabad, ended without agreement. US officials said the discussions reached an impasse over Iran’s nuclear program, while Iranian representatives accused Washington of presenting “excessive” demands. The failure effectively unraveled a fragile ceasefire that had briefly eased tensions in the Persian Gulf region.
WTI crude climbed to around $104.20, with Brent crude also expected to rise sharply as markets opened. Equity futures reacted negatively, with Dow Jones and S&P 500 contracts falling more than 1% in early Sunday trading as investors priced in the risk of prolonged disruption to global energy supplies.
Adding further pressure on markets, US President Donald Trump announced a naval blockade of the Strait of Hormuz, a critical passageway for global oil shipments. In a statement posted on Truth Social, he accused Iran of using the waterway to impose “illegal tolls” and engage in destabilizing activity. The Strait handles roughly one-fifth of the world’s oil and liquefied natural gas flows, making any disruption a major threat to global supply chains.
Analysts warned that if tensions escalate further or the strait is effectively closed, oil prices could climb significantly higher, with some projections suggesting levels as high as $150 per barrel in an extended crisis scenario.
The surge is already expected to hit consumers, with US gasoline prices climbing above $4.12 per gallon and further increases anticipated if crude prices remain elevated. Economists caution that sustained volatility in energy markets could add fresh inflationary pressure at a time when global growth remains fragile.
International financial institutions, including the IMF and World Bank, are expected to address the escalating energy shock at upcoming policy meetings, as markets brace for continued uncertainty in one of the world’s most strategically important regions.
