WTI Crude Oil Futures Surge Past $80 as Hopes Fade for US-Iran Agreement on Hormuz Passage

Oil prices climbed on Monday as skepticism increased over the likelihood of a US-Iran agreement that would allow for the resumption of normal shipping traffic through the Strait of Hormuz.

West Texas Intermediate futures advanced 3.4% to settle at $80.84 per barrel. The global benchmark, Brent crude, also gained 3.3%, reaching $82.64 a barrel.

President Donald Trump told Axios on Sunday that the United States is "only semi-negotiating" with Iran, a shift from his insistence last week that talks were actively underway. Trump indicated a preference for maintaining the naval blockade to pressure Tehran, rather than launching another round of airstrikes.

"We are just watching Iran with its huge inflation and the fact they have no money," the president said in the interview.

Trump canceled a planned military strike against the Islamic Republic on August 1 to create room for diplomacy. Treasury Secretary Scott Bessent told CNBC last Tuesday that a deal to reopen the strait with freedom of movement for vessels could be imminent. However, no agreement has been announced, as both Tehran and Washington have hardened their positions.

Iran's Foreign Ministry spokesman, Esmaeil Baqaei, stated on Monday that the US must first lift its blockade before Tehran would agree to fully reopen the waterway.

"As long as the US naval blockade continues, the necessary conditions for the reopening of the Strait of Hormuz do not exist," Baqaei said, as reported by the state news agency Tasnim. He added that Iran and Oman are holding bilateral negotiations regarding shipping routes through the strait.

The US and Iran signed a memorandum of understanding on June 17 to open the strait to commercial shipping, but the deal quickly unraveled amid disputes over which specific routes vessels could use.

Iran subsequently launched multiple attacks on tankers transiting the strait along Oman's coast, which were under US military protection. Tehran insisted that ships must pass through its territorial waters while navigating the Strait.

In response to the tanker attacks, the US conducted multiple waves of airstrikes and reimposed its naval blockade.