Oil Prices Surge as Trump Rejects Iran’s Terms: What Investors and Businesses Need to Know
Oil prices rose Monday following US President Donald Trump’s rejection of Iran’s conditions for ending the ongoing conflict in the Middle East, while global stock markets showed mixed performance.
Trump’s dismissal of Iran’s response to his latest peace proposal has increased concerns over potential escalation of violence and further disruptions to oil shipments through the strategically vital Strait of Hormuz.
President Trump stated, “I have just read the response from Iran’s so-called ‘Representatives.’ I don’t like it — TOTALLY UNACCEPTABLE!” The president is scheduled to visit China this week, where the conflict is expected to be a key topic of discussion.
Iran’s Foreign Ministry spokesman, Esmaeil Baqaei, responded by emphasizing that Iran’s demands are legitimate rights, not concessions. He outlined Iran’s position calling for an end to the conflict, the lifting of the US naval blockade, and the release of Iranian assets frozen in foreign banks for years.
Lloyd Chan, analyst at Japanese bank MUFG, noted, “President Trump’s swift rejection of these counter-demands underscores the wide gulf between both sides, pointing to a risk of prolonged uncertainty rather than rapid de-escalation.” He added that for the oil market, this implies a continued geopolitical risk premium as disruptions in the Hormuz region persist.
Oil prices retreated from earlier gains, while Asian stock markets were varied: Tokyo closed down 0.5%, Hong Kong remained nearly flat, and Seoul surged 4.3%, driven by strong tech sector performance.
In Tokyo, Nintendo shares tumbled nearly 10% after the gaming giant issued a profit warning for the year and announced a price increase for its upcoming Switch 2 console.
European markets opened lower in Frankfurt and Paris, whereas London saw modest early gains.
US Treasury Secretary Scott Bessent is visiting Japan and South Korea ahead of President Trump’s high-stakes summit with Chinese President Xi Jinping in China.
China’s Foreign Ministry expressed a willingness to cooperate with the United States “in the spirit of equality, respect, and mutual benefit,” aiming to expand cooperation, manage differences, and bring greater stability to an interconnected and volatile world.
Special Analysis by Omanet | Navigate Oman’s Market
The escalation of tensions between the US and Iran, particularly around Strait of Hormuz, signals a sustained risk of oil supply disruptions, which will likely keep prices elevated. For Omani businesses, this geopolitical instability presents both a challenge and an opportunity: higher oil revenues can boost the economy but volatility demands cautious strategic planning. Smart investors and entrepreneurs should focus on diversification and risk management, while leveraging potential gains from the energy sector’s extended premium.
