Oil climbs anew on mixed signals about Iran war's future

Ben Geman

Oil pumpjacks — Pumpjacks work the wells operated by Chevron in Kern County, Calif. Photo: Frederic J. Brown / AFP via Getty Images

Brent crude oil climbed more than 1% to above $110 per barrel when markets opened Sunday amid mixed signals about the Iran war that's creating unprecedented disruption to global energy flows.

Why it matters: President Trump is signaling major escalation, but also told Axios' Barak Ravid that the U.S. is in "deep negotiations" with Iran.

Trump is threatening to bomb Iran's power plants and bridges starting Tuesday if the regime doesn't open the Strait of Hormuz.

The big picture: Markets are also responding to crosscurrents about the Strait of Hormuz and regional infrastructure.

Iranian officials say they will exempt Iraq from restrictions and a tanker carrying the nations' crude has reportedly transited the waterway.
But specifics and conditions for Iraqi crude remain unclear, per Bloomberg and the FT.
Average U.S. gasoline prices also rose Sunday to $4.11 a gallon, up 13 cents from a week ago, per AAA.

Catch up quick: The weekend brought signs of escalation elsewhere, with the WSJ and others reporting on drone strikes hitting oil-related sites in Kuwait and Bahrain.

The NYT reports that "Israel attacked Iran's largest petrochemical industrial complex in the city of Mahshahr on Saturday.

Earlier Sunday, eight OPEC+ countries participating in voluntary production cuts agreed to increase their overall production target by 206,000 barrels in May. But it's unclear when most of these barrels might reach the market as long as the Strait remains closed.

What we're watching: Trump is slated to hold a news conference on Monday afternoon.

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Oil climbs anew on mixed signals about Iran war's future

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