Global oil prices edged higher on Monday while stock markets showed mixed performance, as hopes for a breakthrough in the ongoing conflict between the United States and Iran weakened following a stalled diplomatic effort.
The uncertainty comes after Donald Trump cancelled a planned trip by his envoys for peace negotiations over the weekend, signalling a setback in efforts to end the eight-week-long war.
Hopes for progress during proposed talks in Pakistan were dashed on Saturday when Trump dismissed the need for further discussions, stating there was little value in continuing dialogue under current conditions.
Speaking on Fox News, he said: “We have all the cards. They can call us anytime they want, but you’re not going to be making any more 18-hour flights to sit around talking about nothing.”
Despite the cancellation, Trump revealed that Iran responded swiftly with a revised proposal.
“They gave us a paper that should have been better and interestingly, immediately, when I cancelled it, within 10 minutes, we got a new paper that was much better,” he said, without providing further details.
When asked whether the decision signalled a return to hostilities, Trump downplayed the suggestion. “No, it doesn’t mean that.
”We haven’t thought about it yet,” he told reporters.
Even before the cancellation, prospects for meaningful engagement appeared uncertain.
Iranian state television reported that Foreign Minister Abbas Araghchi had no intention of meeting US officials directly, with Islamabad expected to act as an intermediary for proposals.
According to reports by Axios, citing unnamed sources including a US official, Tehran had submitted a new offer involving the reopening of the strategically vital Strait of Hormuz.
The proposal reportedly suggested postponing nuclear negotiations to a later stage.
Talks between the two sides have reached a deadlock. Iran has criticised what it describes as a U.S. blockade of its ports, while Washington insists that Tehran must allow free passage for ships through the critical shipping route.
Meanwhile, Araghchi arrived in Saint Petersburg on Monday for talks with Russian President Vladimir Putin.
His visit followed recent diplomatic engagements in Pakistan and Oman, reflecting intensified regional efforts to navigate the crisis.
In the commodities market, oil prices rose by more than one percent, though gains were moderated by lingering optimism that a diplomatic resolution could still emerge.
Analyst Fawad Razaqzada of Forex.com warned that prices could surge further if tensions escalate.
“If tensions were to escalate further, particularly into open conflict, there’s a clear risk of a sharper spike.
“For now though, as long as shipping through the Strait remains constrained, that premium is unlikely to fade.
”Until there’s a credible breakthrough, the path of least resistance still looks higher, with a move beyond $110 appearing increasingly plausible, ” he said.
Equity markets reflected the uncertainty, with Asian stocks fluctuating through the morning session.
Gains were recorded in Tokyo, Seoul, and Taipei, supported by strong performance in technology stocks linked to artificial intelligence, following upbeat revenue forecasts from US chipmaker Intel.
Markets in Shanghai and Jakarta also posted modest gains, while Sydney, Singapore, and Manila declined. Hong Kong remained largely unchanged.
The mixed session followed record closes on Friday for both the S&P 500 and Nasdaq indices in the United States.
Investors are now turning their attention to upcoming earnings reports from major US technology firms, including Alphabet, Meta, Microsoft, Amazon, and Apple.
Attention is also focused on the forthcoming policy meeting of the Federal Reserve, where officials are widely expected to keep interest rates unchanged
