Oil prices jump after Trump Iran warning, OPEC splits 2026

What moved markets this week

Oil prices rose as investors weighed the war involving Iran, threats of escalation from U.S. President Donald Trump, and signs of strain inside OPEC after the U.A.E. announced it would exit the cartel. The backdrop has been weeks of sharp swings across commodities and equities as the Strait of Hormuz remained effectively closed to oil tankers, tightening supply routes. In the U.S., stock indexes fell in early trading on Tuesday before stabilising later in the session. The market focus was also on a deadline set by Trump for Iran to reopen Hormuz.

Trump’s Hormuz deadline and the “no more” message

Trump set an 8 p.m. ET deadline for Iran to reopen the Strait of Hormuz and warned of sweeping airstrikes on infrastructure targets if it did not happen. In a Truth Social post on Tuesday morning, Trump said “a whole civilization will die tonight” unless a deal is reached by his deadline. In a separate prime-time address since the war began, he said the U.S. would continue attacks and promised fresh strikes over the next two to three weeks. He also said the U.S. would “finish the job” in Iran soon and warned of further strikes on energy facilities if no deal was reached with Tehran. In that speech, he did not give details that would lead to reopening the Strait of Hormuz.

Oil above $100: where Brent and WTI traded

Oil prices moved sharply around the developments. In early trading on Tuesday, Brent crude rose 1% to $110.81 per barrel and WTI jumped 2.9% to $115.70. By the end of Tuesday, Brent settled down 0.5% at $109.27, while U.S. crude for May delivery briefly climbed above $117 before settling at $112.95, up 0.5%. In another update during the week, WTI traded above Brent in a rare move as the conflict most directly affected seaborne flows tied to Brent pricing. Near 3 p.m. CET in one session, WTI was up 11.5% at over $111 per barrel, while Brent front-month futures traded at $108.90, up more than 7.6%.

Equities react: intraday drop, late recovery

U.S. equities tracked the oil shock and geopolitical risk premium. In early trading on Tuesday, the S&P 500 fell 46 points (0.7%) to 6,566, the Dow fell 324 points (0.7%) to 46,346, and the Nasdaq dropped 1.1%. Later, after falling for much of the session, the S&P 500 recovered to close essentially flat. The Dow ended down 85 points (0.2%), while the Nasdaq finished up 0.1%. The price action reflected shifting expectations around whether the supply disruption would persist.

Gasoline prices jump to the highest since 2022

Higher crude prices have already fed through to retail fuel. The average U.S. national price for a gallon of regular gasoline climbed on Tuesday to $1.14, according to AAA data. That compares with $1.98 just before the outbreak of hostilities. The spike is notable because it pushes consumer fuel costs to their highest level since 2022, adding to the inflation risk warnings already tied to the war-driven energy shock.

OPEC fractures: U.A.E. announces exit

Alongside the war headlines, OPEC cohesion itself became a market theme. The U.A.E. said it would exit OPEC, a move it said would help it meet changing demand. Analysts described the decision as a major blow to the organisation, especially as Middle East supply constraints were already tightening the market. The combination of an active conflict near key export routes and political fragmentation among producers has contributed to the volatility premium in crude prices.

Why the oil market narrative is shifting

The conflict has accelerated a shift from an oil market shaped mainly by economic efficiency to one shaped more by politics and conflict. With Hormuz effectively shut, the physical route risk is a direct input into pricing, not just a tail scenario. Oil prices have climbed more than 50% since the war began at the end of February. Brent is still well above its roughly $10 level from before the war began in late February, underlining how quickly the benchmark repriced.

Corporate knock-ons across energy and utilities

Some energy companies are reporting or highlighting financial impacts. TotalEnergies said it would return more cash to shareholders as the Middle East conflict provided an earnings windfall. BP profits doubled as the war boosted oil traders, according to a separate headline. Another report said Iran was flooded with so much unsold oil that it was stashing it in derelict tanks, pointing to stress in the trade flow even as benchmark prices surged. Separately, Shell was set to expand in Western Canada with a deal to buy Arc Resources, aimed at boosting production at a time when Canada is looking to grow energy exports.

Key numbers to watch

Market impact and what investors are pricing

The immediate market signal has been a sustained repricing of energy, with oil holding above $100 and spiking above $110 on escalation risk. Equity volatility has tracked the same uncertainty, with sharp intraday moves as traders reacted to deadlines and shifting expectations for supply disruptions. The closure of the Strait of Hormuz has been central because it has “strangled” the global flow of oil and liquefied natural gas, according to the report. Economists have warned that the more-than-50% rise in oil since late February raises inflation risks, which can feed into interest-rate expectations and equity valuations.

Conclusion

Oil, equities, and consumer fuel costs remain sensitive to developments around the Strait of Hormuz and the stated U.S. timeline for further military action. The U.A.E.’s decision to exit OPEC adds another layer of uncertainty for supply coordination. Markets are likely to keep reacting to any confirmed steps toward reopening Hormuz, changes in maritime risk, and further official statements from governments and producers.