Hope of US-Iran Peace Fade, Oil Prices Continue to Rise Maritime Activity Reports, Inc. May 12, 2026 © Adobe Stock/M. Jurzyk Hopes for a peace deal with Iran dwindled on Tuesday after Donald Trump said a ceasefire was "on life support" as Tehran rejected a U.S. proposal to end the conflict and stuck to a list of demands the U.S. president described as "garbage". Iran has called for an end to the war on all fronts, including Lebanon, where U.S. ally Israel is fighting Iran-backed Hezbollah militants. Tehran also emphasised its sovereignty over the Strait of Hormuz, demanded compensation for war damage, and an end to the U.S. naval blockade, among other conditions. Trump, who will discuss the war with Chinese President Xi Jinping during his trip to Beijing this week, said Iran's response threatened the status of a ceasefire announced on April 7. "I would call it the weakest right now, after reading that piece of garbage they sent us. I didn't even finish reading it," Trump, who has repeatedly threatened to end the ceasefire, told reporters on Monday. "It's on life support." OIL EXTENDS GAINS The U.S. had proposed an end to fighting before starting talks on more contentious issues, including Iran's nuclear programme. Brent crude oil futures extended gains, climbing to around $108 a barrel, as the deadlock left the Strait of Hormuz largely closed. Before the war began on February 28, the narrow waterway carried a fifth of the world's oil and liquefied natural gas shipments, and has since become a central pressure point in the conflict. U.S. Central Command said the aircraft carrier Abraham Lincoln was in the Arabian Sea continuing to enforce the U.S. blockade against Iran, having redirected 65 commercial vessels and disabled four. The Pentagon put the cost of the war at $29 billion so far, an increase of $4 billion from an estimate provided late last month. An official told lawmakers the new cost included updated repair and replacement of equipment and operational costs