Oil Market Turmoil Continues Amidst Trump’s Mixed Signals on War Timeline

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Oil markets experienced one of the most volatile trading days in history on Monday, with prices surging to $115 a barrel before sharply falling later in the day. The spike was driven by fears of supply disruptions in the Gulf region, where millions of barrels of crude oil have been shut in and several producers reported slowing production or declared force majeure due to the escalating conflict. Speculation about an emergency meeting of Group of Seven finance ministers and a potential coordinated release of 300 million barrels from emergency reserves by the International Energy Agency briefly helped ease the surge, though prices remained significantly higher than pre-conflict levels.

Later in the day, remarks from US President Donald Trump suggesting the military operation could soon end triggered a sharp drop in oil prices. After reaching a four-year high last seen during the Russian invasion of Ukraine crude prices fell below $100 per barrel and even dipped under Friday’s closing level, before stabilising around $90 when Asian markets opened. Despite the decline, prices remain far above the roughly $60–70 range seen before tensions with Iran escalated.

Trump gave mixed signals about the war’s timeline, at one point saying the operation might be “pretty well complete” and could end soon, while earlier telling Republican lawmakers that “we haven’t won enough.” He argued that the conflict could eventually push oil prices lower in the long term and downplayed the immediate impact on American consumers. The US president also vowed to keep the Strait of Hormuz a critical route carrying about 20% of global oil consumption safe, even suggesting that the US Navy could escort tankers if necessary.

Meanwhile, tensions surrounding the vital shipping lane continue to escalate. Trump warned that the US would strike Iran “twenty times harder” if it attempted to block oil flows through the strait. In response, Iran’s Islamic Revolutionary Guard Corps said its forces were ready to confront US naval vessels in the waterway and warned that continued US-Israeli strikes could lead Tehran to halt oil exports from the region. Iranian officials have also reportedly been considering new “security duties” for tankers and commercial vessels belonging to countries allied with the US, raising fears of further disruption to global energy supplies and the wider economy.