Oil prices rise as Iran rules out interim deal extension, threatens to escalate conflict - CNBC
Crude oil prices have surged following the collapse of a U.S.-Iran memorandum of understanding regarding the Strait of Hormuz. Tensions have escalated as both nations rule out further negotiations, leading to market instability.
Why it matters
Rising oil prices and geopolitical instability in the Strait of Hormuz have significant implications for global energy markets and international security.
Crude oil prices rose Monday after Iran and the U.S. ruled out an extension of the memorandum of understanding that they signed in June to end the conflict.
The agreement is set to expire Monday. A senior Iranian official told Reuters , meawhile, that Tehran would shift to offense rather than relying on defense if diplomacy with the U.S. fails.
U.S. crude oil futures rose 2.6% to close at $84.50 per barrel. Brent crude, the international benchmark, gained 2.7% to settle at $90.87.
"Iranian entities must be prepared to escalate tensions in the Strait of Hormuz and wider region, as Iran will be ready to make decisions and take action on difficult decisions," the Iranian official told Reuters .
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