Trump Rejects Iran Peace Proposal as 'Totally Unacceptable,' Oil Prices Surge Past $100
President Trump dismissed Iran's counter-proposal to end the Middle East war, sending oil prices soaring and raising fears of prolonged conflict in the Strait of Hormuz.
Trump Rejects Iran Peace Proposal as “Totally Unacceptable”
President Donald Trump has dismissed Iran’s response to the latest U.S. peace proposal as “totally unacceptable,” throwing fragile diplomatic efforts into disarray and sending global oil prices sharply higher.
In a post on Truth Social on Sunday, Trump wrote that he had “just read the response from Iran’s so-called ‘Representatives’” and declared, “I don’t like it — TOTALLY UNACCEPTABLE!” The president did not elaborate on the specifics of Iran’s counter-offer.
What Iran Actually Proposed
Iran’s foreign ministry pushed back on Monday, saying it had not demanded concessions. Spokesman Esmaeil Baqaei told reporters at a weekly briefing that Tehran’s conditions were straightforward: an end to the war across the region, the lifting of the U.S. naval blockade, and the release of frozen Iranian assets held in foreign banks.
“We did not demand any concessions. The only thing we demanded was Iran’s legitimate rights,” Baqaei said. He framed the demands as minimal — an end to active hostilities and the return of assets “which have for years been unjustly trapped in foreign banks.”
Iran also warned it would not hold back from retaliating against any new U.S. strikes and would not permit more foreign warships in the Strait of Hormuz, where Tehran has imposed a near-total blockade since the conflict escalated.
Oil Markets React Violently
The diplomatic impasse sent shockwaves through global energy markets. International benchmark Brent crude surged 4.65% to $99.95 a barrel during Monday morning trade in Asia. The U.S. benchmark West Texas Intermediate (WTI) also jumped more than 4% to $105.50 a barrel.
Investors are bracing for further disruptions to supplies through the Strait of Hormuz, the narrow waterway through which roughly one-fifth of the world’s oil passes daily. Iran’s blockade has already choked off much of that flow, and the collapse of peace talks suggests the squeeze will continue.
Asia Braces for a Second Wave
The ripple effects are being felt far beyond the Middle East. Asian economies — which depend heavily on energy imports through the Strait of Hormuz — are running short on their first-line defenses against the energy shock.
When the war began, governments across the region scrambled to adapt: cutting power to save fuel, prioritizing gas for households over industry, and dipping into strategic reserves. But those measures were designed for a short conflict. With no end in sight, the crisis is now cascading through entire economies.
Airfare costs, shipping rates, and utility bills are climbing. The United Nations Development Program estimates that 8.8 million people across the Asia-Pacific region could be pushed into poverty, with potential economic losses reaching $299 billion.
“The countries with the least resources to respond, or the consumers who can least afford to pay, are the ones who feel everything first,” said Samantha Gross of the Brookings Institution.
Domestic Fallout in the U.S.
The diplomatic breakdown is also reverberating in Washington. Defense Secretary Pete Hegseth publicly clashed with Senator Mark Kelly over the state of U.S. munitions stockpiles. Kelly, after receiving a classified Pentagon briefing, described the situation as “shocking” and warned it could take years to replenish supplies depleted by the Iran campaign.
Hegseth accused Kelly of “blabbing on TV (falsely & dumbly) about a CLASSIFIED Pentagon briefing” and said the Defense Department’s legal counsel would investigate whether the senator had violated his oath.
Meanwhile, Trump used the moment to attack previous administrations for their handling of Iran, singling out former President Barack Obama’s 2015 nuclear deal as giving Iran “a major and very powerful new lease on life.” He claimed Iran had been “playing games with the United States for 47 years” and vowed, “They will be laughing no longer!”
Iran Executes Alleged Spy
Against this backdrop of escalating tensions, Iran announced it had executed a man convicted of spying for the CIA and Israel’s Mossad. The judiciary identified him as Erfan Shakourzadeh, who reportedly worked at one of Iran’s scientific organizations involved in the satellite field. He was convicted of passing classified information to both intelligence services.
Iran is one of the world’s most prolific executioners, with rights groups estimating at least 1,500 executions last year. Since the war began in late February, Tehran has ramped up executions, particularly in espionage and security-related cases.
What Comes Next
With Trump rejecting Iran’s proposal and both sides hardening their rhetoric, the prospects for a near-term diplomatic resolution appear slim. The standoff over the Strait of Hormuz continues to threaten global energy supplies, and the economic fallout is spreading from the Middle East to Asia and beyond.
Oil markets will be watching closely for any sign of renewed military action or diplomatic movement. For now, the only thing that’s clear is that the path to peace just got a lot more uncertain.