Trump's 12-hour Iran ultimatum sends oil past $90 before truce

A threat by Donald Trump to annihilate Iranian civilization in a social media post on April 7 sent global markets into a tailspin, pushing oil prices up by more than 3 percent. The 12-hour crisis, which began with an 8:06 a.m. ultimatum and ended with a late-evening reversal, was defused only after Pakistan’s prime minister proposed a two-week ceasefire, which both Washington and Tehran accepted.

"I find it hard to believe that the United States and the international community can accept a situation in which Iran controls this critical energy chokepoint indefinitely," said Richard Fontaine, chief executive officer of the Center for a New American Security, to The New York Times. "That would be a worse outcome than before the war."

The day’s market volatility was almost entirely driven by Trump’s social media posts. After his initial threat, West Texas Intermediate crude futures surged, while the Nasdaq 100 index fell as much as 1.5 percent. Markets reversed sharply after Pakistani Prime Minister Shehbaz Sharif announced he had asked Trump to delay his deadline. Following Trump’s agreement to a two-week pause, S&P 500 and Dow futures jumped as much as 1.7 percent in after-hours trading.

The temporary ceasefire may have averted immediate military conflict, but it leaves the core disputes unresolved. At the center of the conflict is Iran’s stockpile of nearly 970 pounds of uranium enriched to 60 percent purity. If negotiations fail to remove this stockpile from Iran, the U.S. could find itself in a protracted conflict that costs billions daily, only to achieve a less favorable outcome than the 2015 nuclear accord, which saw Iran ship 97 percent of its nuclear material out of the country.

The crisis began Tuesday morning when Trump posted on Truth Social: "Tonight, all of civilization will perish, never to be rebuilt." He set an 8 p.m. deadline for Iran to either agree to a deal or face the consequences. The post triggered immediate preparations for war in Iran, with residents stocking up on supplies. Within 30 minutes, Iranian officials cut off direct contact with U.S. negotiators and warned of retaliatory strikes on Saudi and Emirati oil facilities.

The threat also drew sharp criticism from U.S. allies. French Foreign Minister Jean-Noël Barrot stated, “A civilization cannot be erased,” while Italian Prime Minister Giorgia Meloni, typically a close Trump ally, said, “Iranian civilians cannot and should not pay for the crimes of their leaders.”

U.S. military planners had prepared potential strike packages against Iran's energy infrastructure, though the target list was reportedly smaller than Trump's rhetoric suggested and focused on legitimate military targets to minimize civilian harm.

Tehran's Ten Demands Signal Tough Negotiations

The diplomatic off-ramp emerged in the afternoon when Pakistan’s Prime Minister Sharif publicly called for a two-week extension to the deadline in exchange for Iran reopening the Strait of Hormuz. Trump accepted the proposal just 90 minutes before his deadline expired, announcing the suspension of strikes via Truth Social.

However, the terms proposed by Iran for a permanent ceasefire, delivered via Pakistan, suggest a difficult path ahead. The ten-point plan demands that the U.S. withdraw all troops from the region, lift all sanctions, and recognize Iran's right to enrich uranium.

Crucially, the plan also stipulates that passage through the Strait of Hormuz would be "controlled" and coordinated with Iranian armed forces, who would have a "dominant position." It also includes a provision, reported by CCTV, to levy a toll on ships passing through the strait for the first time in history, with the revenue directed to Iran's reconstruction. Fontaine described the ten-point plan as "a pre-war wish list for Iran."

With the two-week clock ticking, the fundamental issues that sparked the five-week conflict remain unresolved. Should negotiations falter, Washington and Tehran could once again find themselves on the brink of a major confrontation in the Middle East.

This article is for informational purposes only and does not constitute investment advice.

A World on Edge After Truth Social Post

Tehran's Ten Demands Signal Tough Negotiations