WTI crude oil futures gave up about 6% in the first week of May 2026 as hopes for a US-Iran deal to end the war and reopen the Strait of Hormuz rose and faded, then jumped more than 3% on Monday, May 11, after President Trump rejected Iran's response to a US peace proposal. The round trip — from about $106 a barrel at the start of the week to under $95 and back toward $98 — showed a market trading on diplomatic headlines rather than on inventories or demand.
The Week in Prices
Front-month WTI settled near $106.42 a barrel on May 4, holding the elevated range that had persisted since the strait was effectively closed at the end of February. On May 6, reports that Washington and Tehran were close to an agreement sent WTI down more than 6% to $96.21, and Brent briefly dipped below $100. On May 7, with the US waiting for Iran's reply to its proposal, WTI slipped another 0.3% to settle at $94.81 while Brent closed at $100.06 — after trading about 5% lower intraday before a senior Iranian official appeared to rebuff the plan. Both benchmarks ended the week down roughly 6%.
Iran's response, made public over the weekend, focused on ending the war on all fronts including Lebanon, and demanded compensation for war damage, recognition of Iranian sovereignty over the Strait of Hormuz, an end to the US naval blockade, guarantees against further attacks and the lifting of sanctions and the US ban on Iranian oil sales. Within hours Trump dismissed it on Truth Social as "TOTALLY UNACCEPTABLE." WTI rose about $3, or 3.2%, to around $98.40 on Monday, May 11, and by May 12 it had settled at $102.18 with Brent at $107.27.
Why Headlines Beat Fundamentals
With roughly a fifth of the world's oil supply affected by the Hormuz disruption, the outcome of US-Iran talks mattered far more for prices than the weekly EIA inventory report or macroeconomic data. Each report of progress removed part of the war premium; each setback restored it. That is why WTI's daily moves in this period were often several dollars in either direction, even on days with no change in physical flows.
The same pattern repeated through the summer: the April 8 ceasefire triggered the biggest one-day drop in oil since April 2020, a late-May signal that talks would succeed knocked WTI back below $90, and renewed fighting in September pushed it above $100 again. For live prices, see the WTI live chart; for the longer picture, the WTI price history page.
How the WTI-Brent Spread Behaved
Throughout the crisis Brent, the waterborne benchmark most exposed to Middle East supply, generally traded at an unusually wide premium to WTI, which is priced at landlocked Cushing, Oklahoma. In the first week of May the gap was around $5 a barrel; in March it had briefly exceeded $15, the widest since 2012. Our WTI-Brent spread guide explains why the spread widens when seaborne supply is disrupted.
Sources
- CNBC — Oil prices edge lower as U.S. waits for Iran response to deal proposal (May 7, 2026)
- Al Arabiya — Trump rejects 'unacceptable' Iran response to peace plan, oil prices jump (May 11, 2026)
- Euronews — Oil jumps 4% as Trump rejects Iran's response to ceasefire proposal
- Wikipedia — 2026–2028 world oil market chronology (daily settlements)