Axios reported late on Sunday that Iran proposed reopening the Strait of Hormuz in return for postponing talks on its nuclear concessions.
Oil futures climbed on Monday after President Donald Trump canceled his U.S. envoys' trip to Islamabad for peace talks with Iran on Saturday.
West Texas Intermediate, the U.S. benchmark, (CL00) (CL.1) rose more than 2% to $96.41 a barrel, while Brent crude (BRN00) (BRNM26) advanced 2.4% to $107.89 a barrel.
The lead Brent contract has only closed twice above the century mark since April 7.
The gain Trump telling Jared Kushner and Steve Witkoff not to travel to Pakistan for a two-day visit to negotiate with a delegation from Tehran.
"We have all the cards, they have none! If they want to talk, all they have to do is call!!!" the president wrote in a post on Truth Social. On Saturday, Iran's Foreign Minister Abbas Araghchi described the talks with Pakistani officials as "very fruitful" but said he doesn't know yet if the U.S. is "truly serious about diplomacy."
Late on Sunday, Axios reported that Tehran had submitted a proposal to Washington to reopen the Strait of Hormuz in return for postponing discussions on the Islamic Republic's nuclear concessions.
Rich Privorotsky, of Goldman Sachs, wrote in a note that the offer would give the U.S. an "out" if the aim is simply to reopen the shipping route, "but I would think this is a bit of a non-starter if the terms mean flows still run through Iranian control route."
On Sunday, the investment bank upgraded its price target for oil amid continued disruption to the production and flow of global supplies. Goldman Sachs is now expecting WTI to reach an average of $83 a barrel and Brent crude to rise to $90 a barrel, up from $75 and $80, respectively, by the end of the year.
The change in outlook is based on the assumption that exports from the Persian Gulf will not normalize until the end of June, compared to a previous estimate of the middle of May, and an expectation of slower production recovery in the region.