Oil prices surged Monday after Donald Trump threatened Iran. Negotiations between Washington and Tehran added to the uncertainty. These prices reversed dramatically later in the session after mediators announced a roadmap for a final deal within 60 days.
Donald Trump’s threat to Iran results in oil price change
The volatile trading session began when Trump warned of possible strikes if Hezbollah continues attacks on Israel, injecting fresh uncertainty into already fragile peace negotiations. Brent crude rose as much as 2.2% at the market open, touching $82.30 per barrel, while West Texas Intermediate climbed above the $78 mark.
The gains proved short-lived. International benchmark Brent futures for August later fell over 2% to $78.96 a barrel, and WTI futures for July declined to $76.30 after mediators Qatar and Pakistan confirmed U.S. and Iranian officials had agreed on a framework for talks.
High-level discussions at Switzerland’s Bürgenstock resort opened amid contradictory signals. Iranian media reported Tehran had suspended negotiations following Trump’s warning, though sources familiar with the matter said talks continued into the early hours of Monday. The discussions focused on safeguarding navigation through the Strait of Hormuz and ensuring compliance with the Israel-Hezbollah ceasefire in southern Lebanon, according to a Bloomberg report.
The Bürgenstock talks are the start of a 60-day negotiation period initiated after Trump signed a memorandum of understanding last week aimed at easing tensions. A joint statement from mediators said parties would continue technical negotiations throughout the week and establish a high-level committee to oversee the process.
“The renewed uncertainty has pushed crude oil prices modestly higher, a development that could weigh on sentiment in the near term,” said Ponmudi R, CEO of Enrich Money. He noted investors remain focused on negotiation headlines, with crude currently trading in the $77–78 range after recently declining to around $73 per barrel.
Quantum Strategy’s David Roche warned that the Middle East oil supply appears close to prewar levels only when counting crude held in storage and aboard tankers. The apparent abundance reflects inventory liquidation rather than production recovery, leaving markets vulnerable once stockpiles deplete.
