President Donald Trump escalated the rhetoric in the Iran-U.S. conflict on Monday, asserting that American forces have taken full control of the Strait of Hormuz, the narrow waterway through which about a fifth of the world’s oil passes. Speaking to reporters at the White House, Trump claimed the U.S. military now dominates the strait and demanded that Iran compensate the United States for the costs and damages incurred since the war began on February 28.

“We control the Strait of Hormuz, and they know it,” Trump said. “They have caused tremendous damage, and they should pay for it. Their economy is suffering because of this war, and they need to understand that.” The president’s statement echoed a key Iranian demand: Tehran has long insisted that the U.S. pay reparations for the destruction caused by the conflict. By flipping the script, Trump appears to be trying to pressure Iran into negotiations on American terms.

The Strait of Hormuz, located between Oman and Iran, is a vital artery for crude oil exports from Saudi Arabia, Iraq, Kuwait, the United Arab Emirates, and other Gulf states. Any disruption to shipping through the strait can send shockwaves through global energy markets. On Monday, oil prices surged 5% as traders reacted to the uncertainty. Benchmark Brent crude rose above $80 a barrel, while West Texas Intermediate climbed to $75.

The war, which started in late February, has seen both sides trade strikes and accusations. The U.S. has deployed additional naval assets to the region, while Iran has threatened to block the strait in retaliation. Trump’s claim of control suggests a significant military escalation, though independent verification is difficult. Pentagon officials did not immediately confirm the president’s statement, and analysts remain skeptical.

“This is a high-stakes bluff,” said Dr. Emily Rostami, a geopolitical analyst at the Middle East Institute. “The U.S. Navy has a strong presence, but full control of the strait would require a massive and sustained operation. It’s more likely a negotiating tactic.” Iran’s Foreign Ministry quickly dismissed Trump’s remarks as “baseless propaganda” and reiterated that the strait remains under Iranian influence. “The United States is not in a position to dictate terms,” a spokesman said. “We will not pay a cent for their aggression.”

The stalemate shows no signs of breaking. Economic data from Iran indicates a sharp contraction in GDP, with inflation soaring and the rial weakening. Trump pointed to these figures as evidence that his strategy is working. “Their economy is in ruins,” he said. “They have no choice but to come to the table.” Yet Iran’s leadership has shown no willingness to negotiate under pressure. Supreme Leader Ayatollah Ali Khamenei has called the war a “test of resilience” and urged the nation to endure.

On the ground, the conflict has claimed hundreds of lives, though exact numbers remain contested. The U.S. has reported no combat fatalities in recent weeks, but Iran has suffered significant military losses. Humanitarian organizations warn of a growing crisis, with civilians caught in the crossfire.

Market analysts are closely watching the Strait of Hormuz. Any disruption to tanker traffic could push oil prices even higher, threatening global economic recovery. The 5% jump on Monday was just a preview, some experts say. “If the stalemate persists, we could see prices spike by 20% or more,” said John Remington, an energy economist at Columbia University. “The Strait is the world’s most important oil chokepoint, and the U.S. claim of control is unprecedented.”

As the war drags into its third month, both sides are digging in. Trump’s demand for compensation is a sharp departure from previous U.S. policy, which had focused on sanctions and diplomatic isolation. By mirroring Iran’s own reparations demand, the president is attempting to shift the narrative. But Tehran appears unmoved. The standoff continues, with no end in sight.