Chevron (NYSE:CVX) shares are trading higher during Monday's premarket session as U.S.-Iran tensions dashed hopes for a lasting Middle East peace deal.

As of early today, West Texas Intermediate (WTI) crude oil price surged 5.72% to $88.65, and Brent crude oil price increased 4.70% to $94.63.

US-Iran Tensions Flare Again

This weekend, Iran had declared the Strait of Hormuz reopened, but by Saturday, vessel traffic through the key shipping lane was restricted again, with state media saying the U.S. "did not fulfill their obligations."

Trump warned Sunday he would "knock out every single Power Plant, and every single Bridge, in Iran" if Tehran did not agree to Washington's terms to end the conflict, with the fragile ceasefire set to expire this week."

This led to a sharp increase in oil prices and rattled investor confidence heading into a pivotal week of earnings. Energy (XLE) is up 1.49%, making the sector one of the few bright spots in early trading.

Strategic Asset Swap in Venezuela

Last week, Chevron agreed to an asset swap with Petroleos de Venezuela (PDVSA) to strengthen its ...