Oil jumps as Trump dismisses Iran’s reply to peace plan
President Donald Trump’s swift rejection of Iran’s response to a US peace offer has sent oil prices soaring and paralyzed shipping in the Strait of Hormuz amid concerns that the 10-week-old conflict will continue.
Days after the United States submitted an offer in hopes of restarting talks, Iran issued a response on Sunday focused on ending the war on all fronts, especially in Lebanon, where U.S. ally Israel is fighting Iranian-backed Hezbollah militants.
Tehran also included a demand for compensation for war damage and emphasized Iran’s sovereignty over the Strait of Hormuz, Iranian state television said.
He also called on the United States to lift the naval blockade, guarantee no further attacks, lift sanctions and lift a U.S. ban on Iranian oil sales, the semi-official Tasnim news agency said.
Within hours, Trump rejected Iran’s offer, posting on Truth Social, “I don’t like it – COMPLETELY UNACCEPTABLE,” without providing further details.
The United States has proposed ending hostilities before starting talks on more controversial issues, including Iran’s nuclear program.
After Trump rejected its demands, Tehran said on Monday it believed the offer to end the war was “generous and responsible.”
“Our demand is legitimate: to demand an end to the war, to lift the (US) blockade and piracy, and to demand the release of Iranian assets unjustly frozen in banks due to US pressure,” foreign ministry spokesman Esmaeil Baghaei said.
“Safe passage through the Strait of Hormuz and ensuring security in the region and Lebanon were Iran’s other demands, which were considered a generous and responsible offer in terms of regional security.”
Oil prices rose more than 3.5 percent on Monday on news of a continuation of the impasse that has left the Strait of Hormuz largely closed.
Before the war began on February 28, the narrow waterway, which carries a fifth of the world’s oil and liquefied natural gas flows, emerged as one of the central pressure points of the war.
Although traffic in the Strait of Hormuz is minimal compared to pre-war levels, shipping data from Kpler and LSEG showed that three tankers loaded with crude oil left the waterway last week with trackers turned off to prevent an Iranian attack.
Sporadic flare-ups in fighting around the Bosphorus in recent days have tested the ceasefire that has paused all-out war since it came into force in early April.
Polls show the war is unpopular with U.S. voters facing sharply higher oil prices less than six months before nationwide elections that will determine whether Trump’s Republican Party retains control of Congress.
The United States also found little international support because it rejected calls from its NATO allies to send ships to open the Strait of Hormuz without a full peace agreement and an internationally authorized mission.
It is unclear what new diplomatic or military steps may be taken ahead.
Trump is expected to come to Beijing on Wednesday, and Iran is among the issues that Trump and Chinese President Xi Jinping will discuss.
Trump is counting on China to use its influence to force Tehran to make a deal with Washington.
Referring to whether the combat operations against Iran are over in his statement published on Sunday, Trump said, “They were defeated, but that does not mean they are over.” he said.
Israeli Prime Minister Benjamin Netanyahu said the war is not over because there is “more work to be done” to remove enriched uranium from Iran, dismantle enrichment sites and address Iran’s proxies and ballistic missile capabilities.
In an interview broadcast on CBS News’ 60 Minutes on Sunday, Netanyahu said the best way to remove enriched uranium would be diplomacy, but he did not rule out removing it by force.
Iranian President Masoud Pezeshkian said in a social media post that Iran “will never bow to the enemy” and will “strongly defend national interests.”
