Major Wall Street banks have raised their oil-price forecasts for this year and early next, as stalled efforts to end the Iran war leave the market vulnerable to fresh supply shocks despite a rebound in Middle East crude exports. A survey compiled by The Wall Street Journal—including projections from Goldman Sachs, J.P. Morgan and Morgan Stanley—puts Brent crude at an average of $90.22 a barrel in the fourth quarter, while West Texas Intermediate is seen at $85.47 a barrel. Both are sharply above previous estimates of $78.92 and $74.62 a barrel, respectively.

Oil prices rebounded Wednesday as tensions in the Middle East region remained elevated. Brent crude November futures gained 0.8% to $103.45 a barrel, while the more-active December contract climbed 2.5% to $98.61 a barrel. Front-month WTI rose 1.9% to $91.10 a barrel. The physical supply picture has improved, with Middle East crude exports excluding Iran back at prewar levels, according to data provider Kpler. Saudi Arabia has also resumed shipments through its East-West pipeline after repairing damage from drone strikes, easing pressure on regional supply.

Still, the diplomatic path toward reopening the Strait of Hormuz and resuming talks over Iran’s nuclear program remains highly uncertain, leaving the market vulnerable to renewed disruptions. Meanwhile, tighter physical-market conditions are adding to inflation risks and sparking a debate over potential export restrictions. The prospect of a U.S. diesel-export ban is hanging over the market, while Russia is expected to extend its diesel-export restrictions for another month, according to analysts.

For the full year, the Journal survey sees Brent and WTI at an average of $88.13 a barrel and $82.98 a barrel, respectively. In the first quarter of next year, analysts see Brent falling to $83.44 a barrel and WTI at $79.88 a barrel. China’s role in the oil market remains difficult to gauge, with its demand trajectory likely to be a key swing factor over the next year, according to market watchers. Beijing has so far been able to lean on stockpiles accumulated before the Iran conflict, limiting the need to buy additional crude on the international market.