• President Trump has rejected Iran’s latest offer to ease tensions, vowing to maintain the maritime blockade, according to Axios.
  • The decision signals a continuation of maximum pressure, delaying any diplomatic off-ramp and raising the risk of further economic disruption in the region.
  • Global oil markets (XOM) react with heightened volatility as traders assess potential supply disruptions through the Strait of Hormuz.

President Trump has turned down Iran’s most recent proposal aimed at de-escalating tensions, reaffirming that the U.S. naval blockade will remain in place, Axios reported on Thursday, citing two people familiar with the matter. The rejection dashes hopes for a near-term thaw between the two nations and underscores the administration’s hardline stance.

The offer, which was conveyed through backchannel communications in recent days, included a commitment from Tehran to halt certain nuclear activities in exchange for a partial lifting of sanctions and the reopening of shipping lanes. But the White House deemed the terms insufficient, insisting on broader concessions related to Iran’s ballistic missile program and regional proxies, according to the sources.

“The president was clear: no relief until Iran fundamentally changes its behavior,” a senior administration official said, speaking on condition of anonymity. Attempts to reach the Iranian mission to the United Nations for comment were unsuccessful.

The decision to maintain the blockade keeps pressure on Iran’s oil exports, which have already slumped to historic lows. The Strait of Hormuz, a chokepoint for about a fifth of the world’s petroleum, remains a flashpoint. Earlier this week, the U.S. Navy’s Fifth Fleet reported an increase in “unsafe and unprofessional” interactions with Iranian patrol boats, though no direct clashes have occurred.

Oil prices jumped on the news, with Brent crude rising 2.3% to $78.40 a barrel by midday trading in New York, as traders priced in extended supply risks. Shipping insurance premiums for vessels transiting the region have also spiked, adding to cost pressures for global energy markets.

Allies have reacted cautiously. European Union foreign policy chief Josep Borrell urged both sides to return to negotiations (CVX), while Saudi Arabia and the United Arab Emirates have quietly signaled concern about the blockade’s impact on their own exports. Russia and China have called for restraint but offered no concrete mediation.

Analysts see the move as a calculated gamble. “By rejecting the offer, the U.S. is betting that economic pain will force Tehran to capitulate,” said Henry Rome, a senior analyst at the Eurasia Group. “But the risk of miscalculation or accidental escalation remains high, especially given the crowded waters of the Gulf.”

The administration has not set a timeline for lifting the blockade, leaving the door open for future talks if Iran meets preconditions. For now, the standoff continues, with both sides dug in.

Correction: An earlier version of this article misstated the source of the report. It is Axios, not Bloomberg.