Oil jumps 2% as Trump rejects Iran deal extension

US President Donald Trump on Monday ruled out extending the framework agreement with Iran, sending international benchmark Brent crude up 2.4% to $90.60 per barrel and US benchmark West Texas Intermediate up 2.2% to $84.20 as markets braced for potential supply disruptions through the Strait of Hormuz — a critical chokepoint for global energy shipments.

The gains came as the 60-day negotiating window neared expiration without a comprehensive settlement, heightening concerns that stalled diplomacy could trigger military escalation. Trump told reporters he would not seek an extension of the agreement reached with Iran in June through Pakistani mediation.

Trump rejects nuclear compromise

Speaking to reporters, Trump dismissed the possibility of prolonging the talks, stating that Iranian negotiators were unwilling to meet his terms. "They want to make a deal, but they are not going to make the kind of a deal that I feel is necessary," he said, reiterating that Iran would not be allowed to acquire nuclear weapons.

His remarks renewed concerns that diplomatic stagnation could constrain energy flows through the vital waterway, which handles a significant portion of global oil shipments. The framework agreement had been intended to provide a temporary pause in tensions while comprehensive terms were negotiated.

US claims 'total control' over Hormuz

Trump also claimed that US forces had established "total control" over the Strait of Hormuz through a naval blockade, insisting that maritime traffic remained open despite ongoing tensions. "The strait is open, and the oil prices are coming down, and they will continue to come down unless we decide to do something far more drastic than we are doing," he said, suggesting Washington could tighten restrictions further if negotiations collapse.

Oil prices had traded lower earlier Monday as investors weighed geopolitical risks against indications that Gulf producers were maintaining substantial shipments through the waterway. The reversal toward sharp gains reflected renewed anxiety over potential military escalation and the long-term stability of energy routes connecting Middle Eastern producers to global markets.