Oil climbs after Trump rejects Iranian proposal on Strait of Hormuz

What happened

Oil prices rose on Monday after US President Donald Trump rejected a peace proposal from Iran that was intended to end the conflict. The proposal was linked to reopening the Strait of Hormuz.

With the offer turned down, the closure of the waterway remains unresolved, and crude markets moved higher in response to the news.

Why it matters

The Strait of Hormuz is one of the world's most important shipping channels for crude oil and refined products. When its status is in question, traders price in the risk that cargoes are delayed or rerouted, and energy markets tend to react quickly to political signals about whether the route will stay shut or reopen.

Energy price moves driven by geopolitics rarely stay contained to oil. Higher fuel costs feed into inflation expectations, which shapes how markets read central bank policy and can move the dollar, gold as a traditional haven asset, and equity indices where transport and industrial sectors carry fuel exposure. Crypto is also sensitive to broad shifts in risk appetite during periods of geopolitical stress.

What to watch

Attention turns to further statements from the US administration and from Iran on the rejected proposal, and to any signal on the status of the Strait of Hormuz.