Iran Suspends US Talks, Escalating Tensions; Oil Prices Surge, Stocks Drop

Iran halted indirect negotiations with the US on June 1, 2026, accusing Israel of violating a ceasefire by expanding its ground assault in Lebanon. The suspension sent oil prices sharply higher and global stocks lower, as tensions threatened key shipping routes. Brent crude jumped to around $97 a barrel, reversing last week’s 11% decline that had been driven by optimism over a tentative peace deal. Equity markets dropped on renewed geopolitical uncertainty. Tehran’s lead negotiator, Parliament Speaker Mohammad Bagher Ghalibaf, said Israel’s escalation in Lebanon and the blockade of Iranian ports represent “clear evidence of US noncompliance.” Iran had been exchanging messages with Washington via mediators on a draft agreement that would extend a ceasefire by about two months, reopen the Strait of Hormuz, and lift a US blockade. Now, Iran and allied groups are threatening to close both the Strait of Hormuz and the Bab al-Mandeb Strait, critical chokepoints for global oil and shipping.