Oil prices extended gains on Tuesday, April 7, 2026, as a United States-imposed deadline loomed for Iran to open the Strait of Hormuz or be “taken out”, with U.S. President Donald Trump threatening to order attacks on Iranian bridges and power plants.
Brent crude futures rose $1.74, or 1.6%, to $111.51 a barrel by 0530 GMT, while U.S. West Texas Intermediate crude futures were up $3.45, or 3.1%, at $115.86.
Trump has threatened to rain “hell” on Iran if it fails to comply with his deadline of 8 p.m. EDT Tuesday (0000 GMT Wednesday) to reopen the strait, through which about a fifth of global oil supply is normally shipped, if a deal is not reached.
Responding to a U.S. proposal through mediator Pakistan, Iran rejected a ceasefire and said a permanent end to the war was necessary, and pushed back against pressure to reopen the strait.
A senior market analyst at Phillip Nova, Priyanka Sachdeva, said Iran’s rejection of the U.S. ceasefire proposal has kept tensions elevated and left diplomacy hanging by a thread.
“Oil is holding its gains because the battlefield risk is no longer theoretical. Attacks on energy and shipping assets continue, and traders fear that even if the war ends, damage to infrastructure could sideline barrels for months, not days,” she told Reuters.
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Exports from several Gulf producers have already collapsed due to restricted flows through the Strait of Hormuz.
Iranian forces effectively shut the strait after U.S. and Israeli attacks began on February 28.
A chief market analyst at KCM Trade, Tim Waterer, said: “Clock-watching is now playing almost as big a role in oil markets as the fundamentals themselves in the run-up to Trump’s ultimatum deadline.
“The potential for a ceasefire deal offers some counterweight and could spark a relief move lower if it gains traction, but persistent supply worries from the Hormuz chokepoint and damaged energy facilities are keeping the floor under prices.”
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