President Trump said the United States does not need a deal with Iran, hardening the American position as attacks on shipping in the Strait of Hormuz continued. Brent crude settled 3.3 percent higher at 95.82 dollars after the remarks, as traders priced in a confrontation with no diplomatic off ramp in sight. The statement came as the diplomacy in Abu Dhabi produced a prisoner exchange but no ceasefire.
Why it matters
The attacks in the strait have not stopped for the talks. Iran said an LNG tanker hit a mine, and its Revolutionary Guards said they targeted a United States radar in Bahrain. The Revolutionary Guards had already said two oil tankers were disabled by explosions in the strait, and shipping through the chokepoint has nearly stopped as operators and insurers pull back.
The warning from Tehran has widened the geography of the crisis. Iran top security official Mohsen Rezaei warned that Tehran would strike American bases beyond the Gulf, including in Europe, if United States air strikes resume. Treasury Secretary Scott Bessent has reportedly moved to a military base after the threats, and Israel security cabinet has reportedly ordered stepped up attack preparations.
What happens next
The energy market is already adjusting to a longer crisis. The International Energy Agency said the oil market is set to return to a surplus this quarter for the first time since the United States Iran war began, a shift that could cap prices even while the strait stays dangerous. Buyers are also looking for alternatives, with African liquefied natural gas exports projected to soar as buyers flee Hormuz.
For now, the two sides are talking past each other. Trump says no deal is needed, Iran says any new strikes will bring a wider response, and the tankers keep taking hits in between. The envoys have moved on to Moscow, but the strait, not the diplomacy, is setting the pace of the crisis.
The International Energy Agency said the oil market is set to return to a surplus this quarter for the first time since the United States Iran war began, a shift that could cap prices even while the strait stays dangerous. Buyers are already looking for alternatives, with African liquefied natural gas exports projected to soar as buyers flee Hormuz. Until shipping moves freely again, the strait will set the price of crude.
