Iran stops negotiations with U.S., vows to ‘completely’ block Strait of Hormuz: State media

The report, in a translated post on the social media site Telegram, homed in on Israel’s military operations in Lebanon against the Iran-backed militia Hezbollah.

“No dialogue will take place” until Israel fully withdraws from occupied areas in Lebanon and stops all attacks in both Lebanon and Gaza, per Tasnim.

“Also, the resistance front and Iran have resolved to completely block the Strait of Hormuz and activate other fronts including the Bab al-Mandeb Strait, in order to punish the Zionists and their supporters,” the report said.

The Bab el-Mandeb Strait is a trade chokepoint that connects the Red Sea to the Gulf of Aden.

Oil prices leapt more than 5% higher following Tasnim’s report, which signaled a breakdown in efforts to reach a diplomatic end to the war that is now in its fourth month.

In the following days, the U.S. and Iran launched new attacks against each other, further eroding the tattered ceasefire that has already been repeatedly ruptured by kinetic military operations.

At the same time, Israel has ramped up its military offensive in Lebanon. Prime Minister Benjamin Netanyahu on Monday ordered attacks on Hezbollah-controlled suburbs in Beirut, Reuters reported.

Iranian Foreign Minister Abbas Araghchi in an X post Monday morning said, “The ceasefire between Iran and the US is unequivocally a ceasefire on all fronts, including in Lebanon.”

“Its violation on one front is a violation of the ceasefire on all fronts. The US and Israel are responsible for the consequences of any violation,” Araghchi wrote.

The White House did not immediately respond to CNBC’s request for comment on Tasnim’s report. U.S. Central Command declined to comment.

Iran’s vow to escalate its clampdown on the Hormuz Strait indicates that oil exports from the Persian Gulf are unlikely to increase anytime soon.

Exports through the strait have plunged from prewar levels due to Iran’s blockade. About a fifth of the world’s oil supplies passed through Hormuz before the U.S. and Israel first attacked Iran on Feb. 28.

Barrel prices for Brent and WTI crude oil, while still highly elevated from their pre-war levels, had retreated by double-digit percentages in recent weeks as investors grew optimistic about the prospect of a deal that would fully reopen the strait. But some of that optimism appears to have evaporated following Monday’s developments.

Ship traffic through the strait remains effectively choked off, as it has been since the start of the war, due to Iranian threats and a retaliatory U.S. blockade. While a trickle of vessels have been able to transit the waterway, traffic has remained far below prewar levels, when over 100 ships would pass through each day.

Iran’s efforts to exert control in the strait have raised concerns that Tehran could impose a tolling system on passing ships.

Trump, in a Truth Social post early Monday morning, insisted that Iran “really wants to make a deal,” while chastising U.S. critics who “keep negatively ‘chirping'” about his handling of the war.

“Just sit back and relax, it will all work out well in the end – It always does!” Trump wrote.

— CNBC’s Ryan Ruggiero and Spencer Kimball contributed to this report.