Oil jumps after Trump says Iran ceasefire deal is ‘over’

• Brent and WTI up 6%
• ‘Powerful’ US strikes on Iran
• IRGC targets 85 military sites

Oil prices jumped more than 5 percent on Wednesday after US President Donald Trump said an interim agreement to end the war with Iran was “over”, raising fresh doubts about the fragile ceasefire.

Brent crude contracts rose 5.7 percent to $78.41 a barrel and West Texas Intermediate climbed 6 percent to $74.66 after Trump spoke to reporters in Turkey ahead of a Nato summit.

It is the highest level Brent, the global benchmark, has reached since June 22.

Trump’s remarks, reported by Reuters, came hours after US forces carried out “a series of powerful strikes” against Iran after Iran struck three commercial vessels in Hormuz.

US Central Command called Iran’s actions “unwarranted, dangerous, and a clear violation of the ceasefire” in a social media post on Tuesday night.

On Wednesday, asked whether the memorandum of understanding reached last month was over, Trump said: “It’s a very interesting question. To me, I think it’s over. I don’t want to deal with them.”

“They’re scum. They’re sick people. They’re led by sick people,” he added. “As far as I’m concerned, it’s just a waste of time dealing with them.”

The US-Iran MoU was signed last month, with the two nations agreeing on a roadmap to reach a final deal within 60 days.

A Qatari tanker carrying liquefied natural gas and a Saudi-flagged supertanker laden with crude oil were among the vessels hit off the coast of Oman on Tuesday.

Iran’s Revolutionary Guards said on Wednesday it had targeted 85 US military sites in Bahrain and Kuwait “in response to a US ceasefire violation”, Reuters reported.

The US Treasury Department separately revoked a sanctions waiver issued under a three-week-old interim peace deal allowing Iran to export crude for at least two months while Washington and Tehran continued talks toward a permanent agreement.

Rachel Ziemba, a macrostrategy advisor in New York, called the move “definitely an escalation,” telling AGBI it reinforces many buyers’ “cautious” approach to Iranian crude given the risk of sanctions snapback.

“Overall, it’s definitely a sign the memorandum of understanding is on the rocks,” she said.

The oil sanctions exemption was more symbolic than practical, since all other US financial restrictions against Iran remained in place, Ziemba added on LinkedIn on Tuesday.

“There’s little evidence that buyers other than China were buying Iranian fuel trade or that Iran was able to do much with dollars earned, at least not legally,” she wrote. “This dynamic undermined the benefits to Iran from the MoU.”

Further reading:

• Iran’s vessel attacks push Hormuz traffic north
• Oman and Iran advance rival plans for Hormuz shipping
• Qatar is an economic loser regardless of the peace talks