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EMEA Oil Update: Crude Rallies After Iran Suspends Peace Talks with US

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EMEA crude futures rallied in after-hours trading on Monday after reports that Iran has suspended peace negotiations with the US, stoking concerns over geopolitical stability in the Middle East and continued closure of the Strait of Hormuz.

Brent crude futures climbed 6.83% to $97.27 per barrel, while Murban oil futures advanced 5.99% to $95.45/bbl.

Saxo Bank strategists said crude prices rebounded from a six-week low amid ongoing uncertainty over the prospects for a peace deal to end the war with Iran.

Iran reportedly will suspend indirect communications with the US, and its allied "Resistance Front" plans to completely block the Hormuz and choke other waterways, including the Bab el-Mandeb Strait.

Foreign Minister Abbas Araghchi said that the truce agreement between the US and Iran applies to "all fronts, including in Lebanon," adding that a breach in one area constitutes a violation of the broader arrangement.

"The ceasefire between Iran and the US is unequivocally a ceasefire on all fronts, including in Lebanon," Araghchi said, adding that the US-Israeli alliance is responsible for the consequences of any violation.

On Monday, President Trump said he had not been informed of Iran's decision to halt peace talks ahead of time, according to media reports.

"It's an appropriate thing to say, because they're better negotiators than they are fighters," Trump was quoted as saying. "It doesn't mean we're going to go and start dropping bombs all over there."

Trump lashed out at critics on Monday amid ongoing heightened geopolitical tensions in the Middle East, saying that Tehran "really wants to make a deal" and that it will be a good one for the US.

Scotiabank strategists said a prolonged geopolitical conflict involving Iran would tighten global oil markets and generate significant supply chain disruptions.

Meanwhile, the US and Iran traded fresh strikes over the weekend, and Israeli Prime Minister Benjamin Netanyahu ordered troops to push deeper into Lebanon, developments that threaten a fragile ceasefire between Washington and Tehran.

On Sunday, US Central Command said in a post on X that it had carried out strikes in Goruk and the island of Qeshm "in response to aggressive Iranian actions," saying Iran had shot down a US MQ-1 drone that was operating over international waters.

Iran's Revolutionary Guard, on the other hand, said its aerospace force had targeted the source of what it called a US attack on a telecommunications tower on Sirik Island in Hormozgan province.

Though Iran did not reveal its military target, Kuwait said in a post on Monday that its air defense systems intercepted and responded to missile and drone threats, without disclosing the origin of the attacks.

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Update: Iran Reportedly Halts Talks With US, Threatens to Block Strait of Hormuz

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Oil & Energy

Pezeshkian Reportedly Says Iran Will Try to Facilitate 'Smooth' Passage for Japanese Ships Via Hormuz

Iranian President Masoud Pezeshkian told Japanese Prime Minister Sanae Takaichi on Monday that Iran will allow Japanese vessels to transit the Strait of Hormuz, according to multiple media reports."We will try to provide a smooth and easy passage for Japanese ships," Pezeshkian reportedly told Takaichi during the phone conversation.Iran's Ministry of Foreign Affairs did not immediately respond to' request for comment.During a telephone conversation with Pezeshkian, the third such exchange since the outbreak of the conflict in late February, Takaichi called for a swift resolution to the standoff between Tehran and Washington.Takaichi urged Iran to ensure the free and safe passage of commercial vessels through the Strait of Hormuz, amid the ongoing Middle East conflict and energy supply disruptions that have roiled global markets.Japan's foreign ministry said Takaichi expressed strong hope that Iran will show the greatest possible flexibility and that a peace deal can be reached as soon as possible.Takaichi reiterated her country's position that de-escalation should be pursued through dialogue and diplomacy. She also urged Iranian authorities to restore freedom of navigation via the Hormuz, one of the world's key energy chokepoints.Takaichi said that free and safe passage through the Strait of Hormuz should be secured as soon as possible for vessels from all countries, including Japan and other Asian countries. The strategic waterway handles about 20% of global crude oil and liquefied natural gas shipments.Japan's foreign affairs ministry said Pezeshkian briefed Takaichi on the current status of negotiations between the US and Iran as well as Tehran's outlook for future negotiations.The call comes as energy markets are closely monitoring developments around Hormuz, where shipping disruptions have heightened concerns about global crude supplies and contributed to price volatility.The double US-Iran closure of the Strait is further straining energy-importing nations across Asia amid efforts to stabilize regional security.