Following President Donald Trump’s vehement rejection of Tehran’s demands to begin talks to end the Middle East conflict, Iran announced on Monday that it had demanded the release of its frozen assets and the lifting of a US blockade of its ports.
In addition to sending oil prices skyrocketing and shattering expectations that a solution could be swiftly negotiated to reopen the Strait of Hormuz to commercial shipping, the heated exchange of signals elevated the threat of a return to open conflict in the Gulf.
In a quick social media tweet, Trump expressed his anger after Iran made a counteroffer that he considered “TOTALLY UNACCEPTABLE” in response to the most recent US request for peace talks.
The exchange unnerved global energy markets, with crude prices rising by more than four percent before dropping back slightly in afternoon London trading and a top executive warning the crisis could last for years.
“The energy supply shock that began in the first quarter is the largest the world has ever experienced,” the CEO and president of Saudi oil giant Aramco, Amin Nasser, told investors.
“If the Strait of Hormuz opens today, it will still take months for the market to rebalance, and if its opening is delayed by a few more weeks, then normalisation will last into 2027,” he said.
