Oil Jumps Above $98 as Mideast Tensions Flare

Oil prices surged sharply higher on Monday, with U.S. benchmark West Texas Intermediate (WTI) crude crossing the $98 per barrel threshold. The rally was triggered by heightened geopolitical risk after U.S. President Donald Trump rejected Iran's response to a U.S. peace proposal, dashing hopes for a swift end to Middle East conflicts.

As of midday Monday, May 11, WTI crude was trading at $98.01 per barrel, a gain of $2.59 or 2.71% for the session. The global benchmark Brent crude was at $104.06, up $2.77 or 2.73%. According to live price data, the Bakken crude differential narrowed to -$3.42 per barrel versus WTI.

The price spike follows President Trump's public rejection of Iran's demands, which included recognition of sovereignty over the Strait of Hormuz, war reparations, and the lifting of all U.S. sanctions. "I don't like it – totally unacceptable," Trump stated in a Truth Social post, as reported by OilPrice.com. The rejection increases the risk of a return to full-scale conflict, a key driver for oil market volatility. Trump further warned of potential further strikes if the nuclear issue remains unresolved.

The Strait of Hormuz is a critical chokepoint for global seaborne oil trade, and sustained tensions threaten supply routes. Concurrent clashes between Israel and Hezbollah, despite a ceasefire in Lebanon, add to regional instability. Israeli Prime Minister Benjamin Netanyahu hinted at potential direct intervention against Iran's nuclear sites in a recent interview.

For Bakken operators in North Dakota, the rally directly improves netback prices for barrels sold. With the Bakken differential at -$3.42, the local crude price is approximately $94.59 per barrel based on the WTI midday price. Such strength provides increased cash flow, supporting drilling and completion budgets in the basin.

In other market news, Indian state refiners are expecting a modest increase in retail fuel prices within days, according to Rigzone. This indicates sustained downstream demand in one of the world's largest consuming nations, providing a supportive backdrop for crude.

The sharp midday gain underscores the oil market's continued sensitivity to Middle East supply disruptions. For Bakken producers, the geopolitical premium offers a price uplift, though operations remain exposed to the volatility stemming from international events. The focus will remain on developments in the Iran-U.S. stalemate and any potential escalation.