Oil prices surged by more than 3% after U.S. President Donald Trump dismissed an Iranian peace proposal that aimed to resolve ongoing tensions and potentially reopen the Strait of Hormuz. Following this development, Brent crude futures increased by $3.98, or 3.82%, reaching $108.30 per barrel. Similarly, U.S. West Texas Intermediate (WTI) saw a rise of $3.52, or 3.81%, bringing its price to $95.93 per barrel.

The uptick in oil prices came in the wake of President Trump’s rejection of Iran’s proposal, although he noted that American negotiators could continue discussions with Tehran in the coming week. This situation has tempered expectations for an immediate diplomatic resolution while keeping the door open for ongoing negotiations.

Iran’s proposal was initially presented at the UN General Assembly the previous week and reportedly transmitted to the U.S. via Qatari mediators. The persistent uncertainty surrounding these talks has heightened concerns about potential disruptions to oil supplies and transport through the critical Strait of Hormuz.

Meanwhile, regional tensions continue to simmer, with Saudi Arabia’s coalition reporting the interception of ballistic missiles and drones launched by Iran-backed Houthi forces targeting Saudi territory. Such incidents contribute to the ongoing instability affecting the region.

Despite these tensions, crude exports from major Middle Eastern producers have risen, hitting approximately 12.8 million barrels per day in September. Shipments through the Strait of Hormuz have also shown signs of recovery, alleviating some fears of supply chain disruptions.

Market observers remain focused on the progress of U.S.-Iran negotiations and the security of vital oil shipping routes. These factors are expected to play a significant role in influencing crude prices in the near future.