Oil prices rise ahead of Trump’s Iran deal deadline

Asian markets saw global oil prices climb on Tuesday as tensions mounted over a pivotal deadline imposed by U.S. President Donald Trump. The benchmark Brent crude oil surged by approximately 1.4% to $111.33 per barrel, while U.S.-based crude climbed 2.8% to $115.61. This increase reflects growing market uncertainty about the outcome of negotiations between Washington and Tehran.

Trump’s threat escalates pressure on Iran

On Monday, Trump warned that Iran would face a “night of destruction” if it failed to reach an agreement by 20:00 Washington DC time on Tuesday. The threat comes amid Iran’s plan to block vessels in the strategic Strait of Hormuz, a move linked to retaliation for recent U.S. and Israeli strikes beginning on February 28. Such disruptions have already caused significant delays in Middle Eastern energy exports.

“Market sentiment suggests the U.S. may struggle to secure a deal, with Iran’s firm position risking an extended conflict,” said Ye Lin of Rystad Energy.

Iran has dismissed proposals for a short-term truce, insisting on a lasting resolution to the war and the removal of sanctions. Analysts note that the current price surge indicates investors are skeptical about the likelihood of a swift agreement. Meanwhile, traders are debating whether Trump’s diplomatic overtures are genuine or a tactic to mask plans for a broader military action.

Disruptions in the Strait of Hormuz have already elevated energy costs worldwide, fueling worries about inflation. The waterway, which handles roughly 20% of global oil and gas shipments, has become a focal point for geopolitical risk. Asian nations like Japan and South Korea, dependent on Middle Eastern energy, have felt the strain more acutely than other regions.

Despite some ships navigating the strait recently, the volume remains far below pre-conflict levels. In response, Trump has called on countries to deploy naval forces to the area, aiming to guarantee safer passage for commercial vessels. Several nations have already engaged in talks with Iran to secure passage for their fleets.