Crude oil dropping after historic $11 surge, as negotiators race against Trump’s deadline for Iran

Oil prices fell Monday after a record $11 surge, as diplomats scrambled to avert a U.S.-Iran escalation before Trump’s Tuesday 8 p.m. ET deadline to reopen the Strait of Hormuz or face strikes on Iranian infrastructure. President Trump threatened attacks on Iran’s power plants and bridges via Truth Social unless the critical Strait of Hormuz—vital for global oil shipments—reopens by the imposed deadline. Negotiators intensified cease-fire talks, with Reuters reporting a rejected U.S.-backed proposal: Iran refused temporary Strait access, demanding permanent concessions amid ongoing regional conflicts. The Strait’s closure, a chokepoint for 20% of global oil, triggered the initial price spike, but markets stabilized slightly as diplomatic efforts suggested potential—though fragile—progress. Analysts warn prolonged closure or U.S. strikes could disrupt supply chains, reigniting volatility despite Monday’s partial retreat from peak prices.