-- Global energy markets jumped above $100 per barrel on Monday as the US Navy began blockading Iranian ports following failed negotiations in Pakistan.
The Brent futures contract gained about 7% to $101.92 per barrel. The front-month West Texas Intermediate crude contract surged 7.4% at $103.68 per barrel.
"Oil markets rallied sharply on Monday after US-Iran talks collapsed over the weekend," ING analysts said.
Traders are bracing for long-term disruptions in the world's most vital energy artery as geopolitical tensions reach a breaking point.
The blockade, coming on the heels of failed peace talks, has intensified concerns that a vital global energy artery could remain choked for the foreseeable future.
"In response, the US military plans to implement a blockade of all maritime traffic entering and exiting Iranian ports from 10:00am Monday Washington time, while allowing vessels not calling at Iranian ports to continue transiting Hormuz," ING said.
After 21 hours of marathon talks between Vice President JD Vance and Iranian officials, the sides failed to reach a deal regarding Iran's nuclear program and regional conflicts.
President Trump acknowledged the domestic impact on Sunday, noting that gasoline and oil prices are likely to remain elevated through the November midterm elections.
Iranian officials have warned that they maintain full control of the waterway, raising the specter of direct naval confrontations.