Trump Rejects Iran Truce Extension, Oil Prices Soar
The prospects for a US-Iran peace deal weakened after President Donald Trump rejected an extension of a June truce agreement. The US would not seek to extend the memorandum of understanding with Iran, which was set to expire on Monday.
Trump said the US retained leverage over Iran through its naval blockade of Iranian ports and continued to argue that Washington had control over the Strait of Hormuz.
Iranian officials warned that Tehran could escalate tensions in the Strait and across the region if diplomatic efforts with the US fail.
The rejection of the extension deal led to a surge in oil prices, as uncertainty over the Strait of Hormuz raised concerns about global supply disruptions. Brent crude settled $2.24, or 2.53%, higher at $90.76 a barrel, while West Texas Intermediate gained $2.18, or 2.65%, to $84.58.
Gold prices also rose as a weaker dollar and reduced Federal Reserve rate-hike expectations supported demand for the precious metal. Spot gold rose 0.94% to $4,417.14 an ounce, while US gold futures settled 0.85% higher at $4,475.00.