Saudi Arabia is urging the US to lift its Hormuz blockade and resume Iran talks, warning escalation could disrupt Red Sea routes and trigger wider global energy and shipping crises.

The U.S. blockade in the Strait of Hormuz risks deepening the energy shock, but markets are shrugging it off amid optimism for a deal.

Global markets have been rattled after Donald Trump announced a US naval blockade of the Strait of Hormuz, escalating tensions following failed peace talks with Iran.