Trump Rejects Iran Truce, Sending Brent Oil Above $107 and Bond Yields to 2007 Highs

Key points

• Brent crude jumped over 3% to trade above $107 per barrel, while WTI rose nearly 2% to exceed $94 per barrel.
• Trump rejected Iran’s seven-day truce offer, which included reopening the Strait of Hormuz and restarting nuclear talks.
• Iran’s conditions for peace include the release of frozen assets, lifting of oil sanctions, and an end to the US naval blockade.
• The 10-year Treasury yield briefly surpassed 5.21%, near its highest level since 2007, driving bond prices down.
• European and Asian stock markets fell, with South Korea’s Kospi dropping 2.3% and the Shanghai Composite losing 1.8%.
• Trump told Axios he expects indirect talks to resume, stating Iran 'overplayed their hand' but wants a different deal.

Background

This development follows a period of volatile oil prices linked to the US-Iran conflict, which began with airstrikes on February 28, 2026. In early September, Trump predicted oil prices would drop only after the November midterm elections. By late September, prices had briefly fallen below $100 as diplomatic signals emerged, but the current rejection of the truce has reversed that trend. Previous coverage noted that Iran’s leadership had expressed distrust toward Washington, while US officials claimed record oil flows through the Strait of Hormuz despite the conflict.

How outlets are covering it

Euronews emphasizes the immediate market shock, highlighting the sharp rise in oil prices and the subsequent drop in global equities and bonds due to inflation fears. It notes that Trump told Axios he expects negotiations to resume, suggesting a potential path to resolution despite the rejection. CNBC focuses on the geopolitical timeline, reporting that Trump told aides he expects US strikes to resume after the November midterm elections. It details Iran’s specific conditions for peace, including the lifting of sanctions and the release of assets, and notes that Saudi-led coalition forces intercepted projectiles from Houthi rebels. Both sources agree on the rejection of the truce but differ in emphasis: Euronews highlights the financial market reaction, while CNBC focuses on the military and diplomatic implications.

Why it matters

The rejection of the truce has reignited fears of a prolonged supply crisis, driving oil prices to multi-month highs and increasing inflationary pressure globally. The surge in bond yields to levels not seen since 2007 signals a shift in monetary policy expectations, with markets pricing in further interest rate hikes. This could slow economic growth by increasing borrowing costs for consumers and businesses. The situation also raises concerns about regional stability, with Houthi activities in the Red Sea adding to shipping risks. The outcome of the US-Iran conflict will have significant implications for global energy markets, inflation, and economic policy in the coming months.

What to watch

Indirect talks between Washington and Tehran could resume as early as Monday, according to Axios. The Federal Reserve is expected to hold its next policy meeting at the end of October, where it may decide on a second consecutive interest rate hike. Trump has indicated that US strikes on Iran may resume after the November midterm elections, which could further escalate tensions. Iran has maintained its conditions for reopening the Strait of Hormuz, and any failure to reach a deal could lead to further disruptions in global energy supplies.