Trump Rejects Iran Seven-Day Truce Offer, Sending Oil Above $108 and Stocks Lower

President Donald Trump rejected Iran's conditional proposal for a seven-day ceasefire and the reopening of the Strait of Hormuz, dashing hopes that had briefly lifted markets late last week. Trump confirmed the decision to reporters on Saturday, saying "They made a proposal but I rejected it," and told aides he expects U.S. strikes on Iran to resume after November's midterm elections, according to the Wall Street Journal.

The rejection reversed market optimism built around Iranian Foreign Minister Abbas Araghchi's proposal, made during last week's UN General Assembly, to reopen the strait and resume nuclear talks. The conflict began with U.S. and Israeli airstrikes on Iran on February 28, 2026, and the Strait of Hormuz closure has fueled a global energy supply crisis since.

Brent crude surged more than 4% to $108.48 a barrel by Monday morning in London, its highest level since September 15, while U.S. West Texas Intermediate rose 4% to $96.16. Wall Street futures fell in response, European stocks turned mixed, and German equities saw cautious trade as higher oil prices stoked fresh inflation concerns. Bond yields rose as markets increased bets on a Federal Reserve rate hike in October, following an earlier tightening move in September. Shipping risks in the region also remain elevated after Houthi forces, backed by Iran, seized Yemen's coastline near the Bab al-Mandab Strait.