Brent oil tops $110 on report U.S. views latest Iranian proposal as insufficient

Oil prices rose Monday on a report that the U.S. views Iran's latest proposal to end the war as insufficient.

International benchmark Brent crude futures for July rose 93 cents to $110.19 a barrel. U.S. West Texas Intermediate futures for June advanced 86 cents to $106.28 per barrel by 11:00 a.m. ET.

A spokesman from the Iranian Foreign Ministry said that talks were ongoing through Pakistan and that both Washington and Tehran had sent in their latest comments to a proposal from Iran.

A senior U.S. official told Axios that the proposal is not a meaningful improvement and is insufficient for a deal. President Donald Trump is expected to meet with his national security team Tuesday to discuss military options, two U.S. officials told Axios.

Meanwhile, Iran's Tasnim news reported the U.S. has offered a temporary reprieve to oil sanctions, a key demand Tehran has been seeking. The U.S. hasn't confirmed that it has offered a waiver publicly. CNBC reached out to the White House for comment, but didn't immediately receive response.

Over the weekend, Trump had warned that Iran "better get moving" on a deal, warning that a delay in reopening the Strait of Hormuz could lead to a resumption in armed conflict. The president's comments came as experts point to record low oil inventories.

Trump said a Truth Social post on Sunday that "For Iran, the Clock is Ticking, and they better get moving, FAST, or there won't be anything left of them," adding that "TIME IS OF THE ESSENCE!"

Brent crude

While a fragile ceasefire was reached in April, tensions between Iran and the U.S. continue with Tehran keeping the Hormuz waterway mostly closed, while the Trump administration continues to blockade Iranian ports.

The strait, prior to the war, saw nearly a fifth of the world's oil and gas supply flow through it.

The International Energy Agency, in its latest monthly update, cautioned that oil inventories globally are depleting at a record pace as the Strait of Hormuz remains closed. "Rapidly shrinking buffers amid continued disruptions, may herald future price spikes ahead," the IEA said.

Inventories will near all-time lows of 7.6 billion barrels by end-May, if demand for oil remains the same month over month, according to a report by Swiss bank UBS last week.  

Jeff Currie, Executive Co-Chairman at Abaxx Commodity Exchange, told CNBC's "Squawk Box Europe" that oil supply concerns will intensify as inventories are depleted.

"Anybody who gets their hands dirty in this business is telling you this is bad," he said. "The Iranians want to inflict pain. It's not the price of oil that matters here — it's the availability of oil."

"There is no physical shortage of oil yet. We could hit that in Europe by the end of the month. The market isn't so worried yet...[but by the] end of May bank holiday in the UK [and] Summer driving season in the US, that's when we'll feel it."

—CNBC's Kevin Breuninger and Garrett Downs contributed to the report.