Oil up 7% as US set to block ships from Iranian ports

• Crude prices above $100 a barrel
• No agreement in US-Iran peace talks
• Iran warns on military ships near Hormuz

Oil prices rose more than 7 percent in early Monday trade after US-Iran peace talks in Islamabad failed and President Donald Trump said the US Navy would block ships entering and exiting Iranian ports via the Strait of Hormuz.

Brent crude futures gained $6.71, or 7.05 percent, to $101.91 a barrel by 01:04 GMT after settling down 0.75 percent on Friday. West Texas Intermediate fetched $104.16 a barrel, up $7.59, or 7.86 percent, following a 1.33 percent loss in the previous session.

“Effective immediately, the United States Navy will begin the process of blockading any and all ships trying to enter, or leave, the Strait of Hormuz,” Trump said in a Truth Social post.

“At some point, we will reach an ‘All being allowed to go in, all being allowed to go out’ basis,” he said.

US Central Command clarified that the blockade would not affect vessels using the strait to and from non-Iranian ports. It said it would begin implementing a blockade on April 13 at 14:30 GMT, in accordance with the president’s proclamation.

Talks between US and Iranian delegations ended without agreement on Sunday, with both parties stating that “significant” differences remained.

“The market is now largely back to conditions before the ceasefire, except now the US will block the remaining up to 2 million barrels per day of Iranian-linked flows through the Strait of Hormuz as well,” Reuters quoted Saul Kavonic, head of energy research at MST Marquee, as saying.

Iran’s Revolutionary Guards earlier said any military vessel attempting to approach the narrow waterway would be considered to have violated the two-week US-Iran ceasefire, declared last week, and would be dealt with harshly and decisively. 

Gold prices fell to a near one-week low on Monday. The dollar strengthened and expectations of a Federal Reserve interest rate cut this year dampened.

Spot gold declined 0.9 percent at $4,720.82 per ounce, while silver lost 2.5 percent to $74.32 per ounce.

The Saudi stock exchange closed 0.25 percent lower on Sunday, with heavyweight Saudi Aramco falling 0.2 percent. The Dubai and Abu Dhabi stock exchanges will open for trading today.

Further reading:

• US deal offers Qatar a golden pass for overseas LNG
• War means higher prices and slower growth, IMF says
• Frank Kane: The old world of energy is being turned upside‑down