Trump's New Deadline on Iran Straits Crisis Sparks Market Anxiety Amid Ceasefire Push
United States President Donald Trump has extended his deadline to Tuesday for Iran to reopen the strategic Strait of Hormuz, issuing explicit threats against Iranian power plants and infrastructure. This move comes as U.S. allies reportedly press for a last-minute ceasefire deal, keeping global financial markets on edge over the potential for a breakthrough or escalation.
Allies Push for Temporary Ceasefire as Threats Escalate
According to reports from Axios, Pakistan, Egypt, and Turkey are actively pushing to secure a potential ceasefire agreement lasting approximately 45 days. This diplomatic effort aims to head off threatened U.S. strikes on Iran's energy infrastructure and prevent retaliation by the Islamic Republic against neighboring countries in the region.
On Sunday, President Trump issued an expletive-laced threat to destroy Iran's power plants and blow up "everything over there," before announcing what appears to be a new Tuesday 8 p.m. deadline without offering specific details. This represents the latest in a series of extensions since he began issuing similar ultimatums on March 21 to force Iran to reopen the critical waterway.
Continued Fighting and Regional Attacks
Despite diplomatic efforts, fighting has continued across the region. Israel, Kuwait, and the United Arab Emirates all reported Iranian attacks overnight into Monday. Tehran has continued striking energy targets in Persian Gulf neighbors, including Kuwait's oil headquarters and a major petrochemicals plant in Abu Dhabi over the weekend.
The United Arab Emirates issued multiple alerts overnight, while Kuwait confirmed its air defenses intercepted missile and drone attacks. The Israel Defense Forces reported that Iran launched four waves of missiles since midnight, with emergency services recovering two bodies from a home struck earlier in Haifa.
Economic Impact and Market Reactions
The conflict has had severe economic consequences, particularly for global energy markets. The fighting has brought vessel traffic through the Strait of Hormuz—through which approximately one-fifth of the world's oil and liquefied natural gas exports normally flow—to a near standstill.
According to Iran's semi-official Fars news agency, only fifteen ships have passed through the Strait of Hormuz with Iran's permission in the past 24 hours, representing about 90 percent lower traffic than before the conflict began. The agency did not elaborate on the ownership or destination of these vessels.
Oil prices rose following Trump's latest warnings, with Brent crude trading at about US$110 a barrel at 6:30 a.m. in London after trimming earlier advances. The global benchmark has increased by more than 50 percent since the beginning of the conflict in late February.
Diplomatic Efforts and Iranian Response
The repeated deadline extensions come as Trump points to ongoing negotiations between his envoys and Iran's leadership, though he has yet to identify specific Iranian negotiators. These talks aim to end the war triggered by U.S. and Israeli attacks in late February, which has left thousands dead, most of them in Iran and Lebanon.
Iran has rejected Trump's latest ultimatum to reopen the Strait of Hormuz, stating it would only fully resume operations when war damages are compensated. This stance complicates diplomatic efforts as the Tuesday deadline approaches.
Signs of last-ditch efforts to secure a ceasefire have helped investors cautiously return to equities, with the MSCI Asia Pacific Index rising 0.3 percent and crude oil paring some gains. Many European markets remained closed during this period of heightened uncertainty.
