Iran has suspended all nuclear negotiations with the United States and pledged to close the Strait of Hormuz, pushing crude prices up sharply. The move came after Tehran tied any further dialogue to a halt in Israeli operations in Lebanon and Gaza. West Texas Intermediate crude jumped about 8% to $96.14 per barrel, while Brent traded near $100.
Why Tehran Pulled the Plug
Iran's top negotiator Mohammad Bagher Ghalibaf said the US blockade of Iranian ports and Israeli operations in Lebanon prove Washington is not complying with a ceasefire framework. State-affiliated Tasnim News Agency reported that Tehran will exchange no further messages until Israel withdraws from occupied parts of Lebanon and ends strikes in Gaza. The suspension follows President Donald Trump's statement nine days earlier that a broader deal with Iran was 'largely negotiated' and would be announced shortly.
A Chokepoint Under Threat
The Strait of Hormuz carried about 20% of global seaborne oil in 2024. Iran also threatened to block Bab el-Mandeb, the chokepoint at the southern end of the Red Sea. Analysts warned that a dual chokepoint disruption would push oil well past $100 and compound oil inventory tightness. Traders are treating the oil price move as a return to wartime risk pricing due to supply constraints since late February.
What Comes Next
The next 48 hours will test whether Trump can pressure Israeli Prime Minister Benjamin Netanyahu to scale back Lebanon strikes or whether Iran follows through on its blockade threat. No further talks are scheduled.
