Brent climbs 1.4% after Trump rejects Iranian seven-day ceasefire offer

Summary

• Brent rose 1.4% to $106.72 a barrel, WTI 1.4% to $93.91.
• Trump turned down an Iranian ceasefire plan that would have reopened Hormuz, the Journal reported.
• Traders are balancing a closed strait against recovering Saudi, Emirati and Iraqi exports.

The latest

Oil prices climbed Tuesday, with front-month November Brent up 1.4% at $106.72 a barrel and West Texas Intermediate up 1.4% at $93.91, as traders weighed the collapse of ceasefire diplomacy against returning Middle Eastern barrels. Both benchmarks had pared gains a day earlier after Saudi Arabia resumed loading ships at Yanbu on the Red Sea, an export route that bypasses the Strait of Hormuz.

Details

• The rejected offer: Trump rejected an Iranian proposal for a seven-day ceasefire that would have reopened the Strait of Hormuz and resumed nuclear negotiations in exchange for Washington lifting its blockade of Iranian ports, The Wall Street Journal reported. No alternative track was announced.
• The read: Sally Auld, group chief economist at National Australia Bank, said the gap between the two sides leaves both a near-term agreement and a broader normalization of oil flows through the strait uncertain.
• The pipeline: The East-West pipeline was moving roughly 4 million barrels a day before it was shut by damage from drone attacks on Sept. 10, and is now running at about 3.5 million barrels a day after repairs, the Journal reported. Its capacity is around 7 million barrels a day.
• Gulf loadings: Shipments from Ras Tanura have risen to around 6.5 million barrels a day from roughly 1.5 million in early September, according to Kpler. Combined crude exports from Saudi Arabia, the UAE and Iraq are back near 13 million barrels a day, the highest since the war began on Feb. 28 and close to 80% of prewar levels.
• The open question: Hamad Hussain, senior economist at Capital Economics, said the key issue is whether Riyadh can sustain higher Gulf shipments as Yanbu volumes recover. Sustained flows through both routes could push Saudi exports above pre-attack levels, he said.
• Still tight: Johannes Rauball, upstream analyst at Kpler, estimated in a Monday report that the global market is running a deficit of roughly 1 million to 2 million barrels a day, with Middle Eastern losses squeezing medium and heavy grades hardest. Refiners are buying more Latin American barrels instead.
• Freight squeeze: Rerouting Saudi crude through less efficient Gulf shipping lanes has roughly doubled the number of vessels needed to move the same volume, lifting very large crude carrier and dirty-tanker rates to record highs, Kpler said. It expects the tightness to persist.
• The chokepoint: Hormuz carried an average 21.6 million barrels a day of crude and petroleum liquids in the fourth quarter of 2025, about one-fifth of global consumption, per the Energy Information Administration. Second-quarter flows averaged 4.9 million barrels a day.

Background

The Strait of Hormuz is the world's most important oil chokepoint, and Saudi Arabia's East-West pipeline is the main route capable of moving Gulf crude to the Red Sea without passing through it. Traffic collapsed after fighting began Feb. 28.

Between the lines

Kpler expects the reopening of Hormuz to be gradual and uneven, and the numbers in this file explain why: barrels are returning through Yanbu and Ras Tanura, but the strait itself stays shut, the market is still short 1 million to 2 million barrels a day, and each replacement cargo now consumes roughly twice the tanker capacity. Supply recovery is arriving through the most expensive available route.

What's next

Watch whether Iran returns with a revised ceasefire proposal, whether the East-West pipeline climbs from 3.5 million barrels a day toward its 7 million capacity, and whether Ras Tanura can hold 6.5 million barrels a day.

Source: The Wall Street Journal, Kpler, Energy Information Administration