Oil prices are climbing again as hopes for a US-Iran deal to end the nearly six-month-old war and reopen the Strait of Hormuz continue to fade. The lack of progress is being felt in the oil market, with crude prices steadily rising in recent days. Iran has stated that the Strait, which handled 20% of the world's oil flows before the conflict, will remain closed until the US meets its demands or until Donald Trump's term ends in 2029. Meanwhile, President Trump has demanded reparations from Iran, leading investors to price out a resolution.

Brent crude rose 1% on Tuesday, briefly surpassing $90 a barrel, while US oil prices climbed 1% to top $83. Industry experts warn that global oil reserves are dangerously low, with stocks in the US Strategic Petroleum Reserve declining to the lowest levels in 43 years. Tuomas Malinen, a Finnish economist at the University of Helsinki, believes America's oil reserves are approaching "the danger zone" and estimates that without price manipulation from SPR releases, crude could trade around $150 to $200.

HFI Research outlined two scenarios for the oil situation: either Iran wins control over the Strait, prolonging the energy shortage, or the US escalates against Iran, destroying more infrastructure. Both paths lead to extremely elevated prices. Helima Croft, global head of commodity strategy at RBC Capital Markets, warns of additional supply pressures from Ukraine's attacks on Russian energy infrastructure. Francisco Blanch, head of commodities at Bank of America, expects further upside if ship traffic through the Strait doesn't significantly increase.