Oil futures rose 1.3% to $83.20 a barrel, pushing U.S. stocks lower as negotiations over the Strait of Hormuz remain deadlocked. The Dow Jones Industrial Average shed 184.13 points, or 0.34%, to 53791.85. The S&P 500 declined 24.91 points, or 0.32%, to 7728.20. The Nasdaq Composite retreated 159.91 points, or 0.6%, to 26445.45.

Oil climbed $1.07 amid signs the Middle East conflict may escalate. Houthi rebels struck a ship in the Red Sea while U.S. forces attacked a vessel moving through the Gulf of Oman violating the blockade on Iranian ports. The yield on the 10-year Treasury note declined 0.014 percentage point to 4.683%. The two-year Treasury yield fell 0.019 point to 4.217%.

The U.S. dollar was flat ahead of key July consumer-price inflation data due Wednesday, which may reveal upward price pressure before the latest spike in oil and gasoline. Gold futures rose $21.20, or 0.5%, to $4383 a troy ounce.