Brent crude traded above $107 a barrel through Asia and early European trade on Tuesday, climbing about 3.2 per cent on the day, after Donald Trump rejected Iran's counter-proposal to the US-led ceasefire framework overnight and warned that the truce was on "massive life support". West Texas Intermediate, the US benchmark, rose 3.3 per cent to $101.37.
Saudi Aramco chief executive Amin Nasser, briefing analysts after the company's first-quarter results published on Monday, said global crude markets are losing roughly 100 million barrels of supply each week as a consequence of the Iranian blockade on the Strait of Hormuz, the disruption to Iranian production and tighter-than-expected OPEC+ compliance. Nasser warned that if the disruptions extended beyond mid-year, "the market normalisation we have been describing as a 2026 story becomes a 2027 story".
Aramco's own results illustrated the dynamic at work. Net income for the first quarter rose 25 per cent year on year to $30.7 billion as higher realised crude prices more than offset slightly lower production volumes. The company maintained its $124 billion annual capital-expenditure programme and announced a $15.5 billion dividend.
Trading desks have begun to position for a higher-for-longer trajectory. Goldman Sachs lifted its end-2026 Brent forecast to $112 from $98 in a Monday-evening note, citing "asymmetric upside risk" from a potential Trump escalation. Bank of America's commodity team raised its average-Q3 Brent call to $108. ING, more cautious, said the rally was "increasingly headline-driven" and warned that any ceasefire breakthrough could trigger a $15-per-barrel correction within days.
The pump-price implication in the United States has become a presidential-grade political problem. AAA put the national average retail gasoline price at $4.52 a gallon on Tuesday, the highest since the summer of 2022. The Trump administration is weighing a federal-gas-tax suspension and is in active conversations with several Republican governors about state-level fuel-tax relief.
In the broader complex, US natural gas held above $4.20 per million Btu and European TTF gas traded near €52 per megawatt-hour as the LNG export programme to Europe and Japan continued to absorb the redirected molecules. Petrochemical refining margins in Asia compressed further, with Singapore complex gross refining margins at $2.10 a barrel — close to the eight-year low.