Strait of Hormuz risk lifts oil above $109 in 2026

Conflict escalates as strikes widen

Israel’s military said it is conducting strikes in Tehran, as the Israel-Iran conflict continues to intensify. The war narrative in global markets has increasingly centred on energy security, given repeated references to the Strait of Hormuz and attacks on regional energy infrastructure. Iranian state television reported that the “US president backs down following Iran’s firm warning,” according to AP. At the same time, U.S. messaging remained firm on its demands, with the White House signalling limited appetite for public back-and-forth on any proposed terms.

Trump’s deadline and the Hormuz flashpoint

A key development highlighted in the live updates was a Monday deadline set by U.S. President Donald Trump for Iran to reopen the Strait of Hormuz or face strikes on Iranian power plants. Tehran has warned it will fully shut the strait and target regional energy infrastructure if attacked. Trump also set a Tuesday 8 p.m. cut-off in separate remarks, threatening that the U.S. military could destroy “every bridge in Iran” and render power plants unusable if Iran does not meet U.S. demands. The White House has repeatedly said the U.S. naval blockade of Iranian ports and vessels would remain until Iran accepts U.S. terms, including handing over enriched uranium and abandoning its nuclear program.

Iran’s proposal: shipping access first, nuclear talks later

Sources told CBS News that Iran offered a deal to reopen the Strait of Hormuz to commercial shipping if the U.S. drops its military blockade of Iranian ports and vessels. The same reporting said the offer apparently includes no concessions on Iran’s nuclear program, which Trump has insisted must be dismantled as part of an agreement. The White House, responding to reports about the proposal, said the Trump administration would “not negotiate through the press,” calling the talks sensitive. U.S. Secretary of State Marco Rubio said preventing Iran from obtaining a nuclear weapon “remains the core issue,” in reference to Iran’s proposal that would postpone nuclear discussions.

Diplomacy setbacks add to uncertainty

The updates also noted that Trump called off plans to send senior envoys Steve Witkoff and Jared Kushner to Pakistan for a second round of direct talks with Iranian officials. Trump said his administration has “all the cards” and that if Tehran wants to talk “they can come to us, or they can call us.” The cancellation left Pakistan-led diplomacy in doubt, as Iran’s foreign minister met Russian President Vladimir Putin in Russia on Monday. Separately, Hezbollah’s leader rejected U.S.-brokered negotiations between Israel and Lebanon and “their outcomes,” raising fresh doubts over a fragile parallel ceasefire.

Oil jumps and swings as traders reprice supply risk

Oil prices reflected repeated shifts in escalation risk and diplomacy headlines. On Monday, Brent futures were up just more than 1% at $106.47 a barrel after initially trading around $108.50. Reuters also reported Brent up about $1, or almost 3%, to $108.36 per barrel early Monday morning, while U.S. West Texas Intermediate (WTI) was up 2.6% at $16.85. Later updates referenced U.S. crude futures up 2% at $18.05 per barrel.

Market moves were sharper around statements about energy infrastructure. Brent crude futures rose $1.87, or 7.78%, to close at $109.03 per barrel in one session, while WTI jumped $11.42, or 11.41%, to $111.54 per barrel. Another update said Brent jumped 6.9% to $108.15 per barrel, and U.S. crude rose 6.4% to $106.55, after Trump’s remarks. Brent also surged 1.4% to $110.60 and U.S. crude climbed 1.8% to $113.60 in a separate move.

Energy infrastructure attacks push prices above $119

A major escalation cited in the feed was Israel’s strike on Iran’s South Pars gas field, followed by Iran attacking energy facilities across the Middle East. Benchmark Brent oil prices jumped above $119 a barrel on Thursday on those reports. Another datapoint in the same stream showed Brent futures up $1.02, or 5.6%, at $113.40 a barrel by 1237 GMT. Even when crude dipped on reassurances, the updates said oil was still holding around $100 while gas surged amid effective closure of the Strait of Hormuz.

India angle: RBI flags oil dependence and policy buffer

For Indian readers, the RBI’s warning was the most direct policy signal in the live updates. The central bank said that given India’s dependence on crude oil imports, the evolving situation requires close monitoring and proactive measures to limit adverse spillovers. RBI also said the creation of an Economic Stabilisation Fund would provide fiscal headroom and a buffer to respond effectively to global headwinds. The broader India-linked feed also referenced stress points such as jet fuel costs doubling in India and a 25% hike for domestic routes, alongside commercial LPG price hikes and the risk of losses at oil marketing companies.

Shipping and LNG: Petronet link highlighted

Amid the focus on shipping disruptions, the updates noted that a vessel carrying LNG is chartered by Petronet LNG. With the Strait of Hormuz described as a chokepoint for about a fifth of global shipments during peacetime, any sustained disruption has implications for freight, insurance, and delivery schedules. The live feed repeatedly linked price swings to constraints on energy shipments through the strait.

Markets react: yields rise, equities mixed

The news flow pointed to mixed equity performance alongside higher energy prices. One update noted world shares were mixed on Monday as oil jumped early in the day. U.S. Treasury moves were also cited, with the benchmark 10-year yield up 10.6 basis points at 4.388%, on pace for its biggest one-day rise since early June 2025. In U.S. equities, another session saw the Dow close down 0.13%, the S&P 500 up 0.11%, and the Nasdaq up 0.18%, reflecting cross-currents between inflation risk from oil and hopes for diplomacy.

Key numbers at a glance

Timeline of escalation and policy signals

Why the story matters for Indian markets

The live updates underline a direct transmission channel from geopolitical escalation to Indian inflation and corporate margins through imported crude and LNG. RBI’s warning puts the focus on monitoring spillovers and keeping buffers, while the reference to an Economic Stabilisation Fund points to a potential policy tool if global headwinds persist. For listed companies, volatility in crude and refined products can affect input costs, inventory gains and losses, and consumer demand, depending on price pass-through. The mention of an LNG vessel chartered by Petronet LNG also highlights the operational importance of uninterrupted shipping routes during periods of heightened risk.

Conclusion

The conflict updates show a mix of hard deadlines, constrained diplomacy, and explicit threats tied to the Strait of Hormuz, keeping oil markets volatile and elevated. In India, RBI has flagged the country’s crude oil import dependence as a key vulnerability and called for proactive measures. The next catalysts remain diplomatic decisions around blockade terms, any changes in shipping access through Hormuz, and further developments on energy infrastructure attacks and retaliation risks.