Oil Prices Extend Gains as Trump Dims Iran Ceasefire Hopes

CNBC reported Tuesday that oil prices pushed higher after President Donald Trump declared the Iran ceasefire effectively on the verge of collapse, dimming any near-term hope for a negotiated end to the Middle East conflict.

Crude Benchmarks Jump as Diplomatic Outlook Darkens

International benchmark Brent crude for July delivery climbed 1.32% to $105.59 a barrel. U.S. West Texas Intermediate for June added 1.62%, reaching $99.63. Both contracts are now up more than 40% since the U.S. and Israeli-led military campaign against Iran began on Feb. 28.

Trump told reporters that Tehran’s latest counterproposal to end the war was “garbage.” He described the ceasefire’s condition as “unbelievably weak,” using a medical analogy to suggest its survival odds sat at roughly 1%. The blunt language effectively closed the door on a near-term diplomatic resolution.

Background: A Conflict That Has Reshaped Energy Markets

The war’s outbreak in late February triggered an immediate supply shock. Iran’s strategic position along the Strait of Hormuz, the chokepoint through which roughly a fifth of the world’s seaborne oil passes, has kept markets on edge for months. An Iranian drone strike on Oman’s Salalah storage facility in March illustrated the conflict’s capacity to disrupt regional infrastructure.

Citigroup noted in a research memo that prices remain volatile and could climb further if diplomatic efforts between Washington and Tehran continue to stall.

Hormuz Blockage Could Delay Market Recovery Until 2027

Amin Nasser, chief executive of Saudi Aramco, added a sobering longer-term warning on Monday. Speaking to investors on the company’s first-quarter earnings call, Nasser said that even an immediate reopening of the Strait of Hormuz would require months for global supply balances to normalise. Any delay beyond mid-June, he cautioned, would push full market recovery into 2027.

Henry Wilkinson, chief intelligence officer at geopolitical risk firm Dragonfly, told CNBC that a fresh escalation in the Iran conflict remains a live possibility. He suggested Trump may use upcoming talks with Chinese President Xi Jinping to press Beijing into leaning on Tehran to accept U.S. terms.

The oil market is now watching those high-level discussions closely. Any signal that China is willing to act as a broker could shift sentiment quickly in either direction.

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