US stocks fell and oil prices surged Monday as tensions over the Iran war heated up again, after President Trump announced the US Navy had seized an Iranian cargo vessel and Tehran sent mixed signals on resuming talks.

The Nasdaq fell 0.3%, snapping its 13-day winning streak , while the Dow Jones Industrial Average was flat. The S&P 500 edged down 0.2%.

Brent crude oil prices jumped 5.6% to settle at $95.48 and West Texas Intermediate rose 6.9% to $89.61. National average gasoline prices dipped slightly to $4.04 a gallon – still over 30% higher than prices before the US and Israel launched strikes on Iran in February.

Traders feared rising tensions in the Middle East after Trump on Sunday announced that the US Navy had blown “a hole in the engineroom” of an Iranian-flagged cargo ship that attempted to skirt the US blockade of the Strait of Hormuz.

The Iranian ship “is under US Treasury Sanctions because of their prior history of illegal activity. We have full custody of the ship, and are seeing what’s on board,” Trump wrote in a Truth Social post.

In a post earlier Sunday, Trump said Iran had fired bullets in the strait at foreign vessels, calling it “A Total Violation of our Ceasefire Agreement!”

“Oil likely has further upside in the near term given the scale of disruption through Hormuz, but…the market still sees this as a temporary shock rather than a permanent shortage,” Esther Sholes, senior macro analyst for Take Profit Trader, told The Post.

“While supply could partially recover within weeks if the Strait reopens, a full normalization would take months and depends on a durable ceasefire and the return of insurers and shippers.”

After Iran refused to join another round of peace talks in Pakistan, Trump reiterated his threat to bomb the nation’s power plants and bridges, which critics have claimed would constitute a war crime. 

However, Iran’s President Masoud Pezeshkian said continuing the conflict “benefits no one” – and Trump told The Post on Monday that he was willing to meet the Middle Eastern country’s leaders in person.

“We’re supposed to have the talks,” Trump told The Post. “So I would assume at this point nobody’s playing games.”

A temporary ceasefire between the US and Iran is slated to expire this Wednesday if no peace deals come through.

“The market is expecting a quick resolution to this conflict,” Jeff Krimmel, founder of Krimmel Strategy Group, told The Post.

“If we have a true escalation, e.g. a mutually acknowledged violation of the ceasefire and a return to active military strikes, then you could see oil prices move upward aggressively. But both sides seem to be pushing toward a negotiated resolution of some form.”

Wall Street is coming off huge gains last week, with the S&P 500 and Nasdaq hitting fresh all-time highs following a ceasefire between Iran and Lebanon.

Iran said last week that the Strait of Hormuz – a vital maritime route for 20% of the world’s oil – was fully reopened, though traffic reportedly remained restricted.