Global oil prices are predicted to hang out in the "low $100s" for most of this year, even if the Strait of Hormuz decides to reopen as early as next month, according to investment bank JP Morgan. So don't start planning that road trip just yet.
The bank said on Monday that oil supplies in the region won't exactly snap back to normal like a rubber band. The analysis comes as oil prices took another leap after President Donald Trump declared Iran's response to U.S. peace proposals "totally unacceptable" - because nothing says diplomacy like a social media rant.
Tehran, via Pakistan (the designated message-passing kid in class), called for an immediate end to the conflict and guarantees of no further U.S.-Israeli attacks on Iran, according to Iran's semi-official Tasnim news agency. International oil benchmark Brent rose by more than 4% to $105.94 a barrel at one point, before settling back down to around $105 - still enough to make your wallet weep.
The key Strait of Hormuz waterway has been effectively shut since shortly after the war started on 28 February, severely disrupting global supplies of oil and gas. Washington's terms for peace included restoring free transit through the strait and suspending Iranian nuclear enrichment, according to Axios. Israeli Prime Minister Benjamin Netanyahu, never one for subtlety, said the war won't be over until Iran's enriched uranium stockpiles are "taken out."
A ceasefire announced in early April has mostly held, despite occasional exchanges of fire. On 21 April, Trump extended the truce indefinitely to give Iran time to present a "unified proposal" - which apparently didn't go over well. In a note on Monday, JP Morgan said its analysis "now suggests that oil prices should remain in the low $100s for most of the rest of this year, averaging $97 for 2026 as a whole."
"Crucially, the analysis does not point to a quick normalization once the Strait reopens," the bank added, noting the bottleneck will likely shift from the strait itself to tanker availability, refinery ramp-ups, and wider logistical constraints. Because of course it will. The Strait of Hormuz, through which about a fifth of global oil and gas shipments usually pass, has been effectively shut after Tehran threatened to attack vessels that try to cross it in retaliation against U.S.-Israeli strikes.
Major energy companies, meanwhile, are laughing all the way to the bank. On Sunday, Aramco said its earnings jumped by more than 25% in the first three months of the year compared to the same period in 2025. Aramco boss Amin Nasser boasted that the company's cross-country pipeline has "proven itself to be a critical supply artery" and helped it avoid disruptions. Last month, BP reported its profits for the first quarter more than doubled, while Shell announced last week that its earnings had jumped.
Nasser told investors on Monday that the energy shock triggered by the war is likely to extend into 2027, even if the Strait of Hormuz re-opens. "If the Strait of Hormuz opens today, it will still take months for the market to rebalance, and if its opening is delayed by a few more weeks, then normalisation will last into 2027," he said, adding that the market has seen an "unprecedented supply loss of about a billion barrels of oil." Crude output by OPEC in April fell by 830,000 barrels per day month-on-month to 20.04 million bpd, according to a Reuters survey. So, in summary: oil stays expensive, companies get richer, and the rest of us get to keep paying more at the pump.