DTN Oil Update
WTI at $112 as US Keep Its Tuesday Deadline on Iran
SECAUCUS, N.J. (DTN) -- Oil futures rose on Monday, recovering from early declines, after the U.S. reiterated its warning that Iran's power plants and bridges will be destroyed by Tuesday, April 7, if it did not reopen the Strait of Hormuz it has blockaded.
U.S. President Donald Trump said the Tuesday 8:00 p.m. EDT deadline he had given to Iran to "will not be moved again." The ultimatum, originally issued March 21, had been postponed twice previously.
"I've given them chances, and they haven't taken them. Iran won't have bridges and power plants if there is no deal," Trump said. "We have a plan where every bridge in Iran will be decimated by 12 o'clock tomorrow night. Every power plant in Iran will be out of business, burning, exploding and never to be used again, by 12 o'clock. And it will happen over a period of four hours."
P[L1] D[0x0] M[300x250] OOP[F] ADUNIT[] T[]
U.S. Defense Secretary Pete Hegseth, appearing at a news conference with the president, said Monday will mark the largest volume of strikes on Iran since the February start of the U.S.-Israeli military campaign. "Tomorrow's strikes on Iran will be more than today," Hegseth added.
The NYMEX WTI crude futures contract for May delivery settled Monday's trade at $112.41 bbl, up $0.87, or 0.8%, as the second week of April began. It rose 11% in the first week.
ICE Brent futures contract for June closed at $109.77 bbl, higher by $0.74, or 0.7%.
The spread between the two benchmarks was about $7 in WTI's favor, after shifting to that structure last week for the first time since 2022.
Among refined products, RBOB futures for May delivery finished at $ 3.3082 gallon (3.2880), up $0.0202 on the day. Front-month ULSD futures ended at $ 4.3284 gallon (4.3611), easing $0.0327.
The U.S. Dollar Index softened by 0.060 points to 99.795 against a basket of foreign currencies.
Energy prices slid earlier on Monday on the potential chance of a truce after Pakistani mediators, who had been in touch with U.S. and Iranian officials, said there could be a ceasefire. With that, the Hormuz, the waterway for 20 million bpd of global petroleum cargoes, could also reopen, allowing broader peace talks, the mediators said.
Tehran is using military strikes and opaque vetting to control the strait, which connects Middle East oil exporters with the Persian Gulf and global waterways. Two Qatar-owned LNG tankers were among those that transited the Hormuz on Monday, reports said. Prior to that, Japanese and Iraqi vessels, along with tankers from countries deemed "friendly" to Iran, including China, Russia and India, were allowed to pass.
Iran and Oman, which border the Hormuz along with the UAE, were reportedly finalizing on Sunday, April 5, a formal protocol for transit on the strait, viewed by analysts as a precursor to the first-ever toll collection on vessels in the region.
Trump, when asked about the toll collection plan on Monday, said the U.S. should have the prerogative for doing so.