--- title: "US-Iran Deal Remains Elusive; Analysts Warn Oil Prices Could Surge to $120–$140" type: "News" locale: "en" url: "https://longbridge.com/en/news/295519665.md" description: "The stalemate in the Strait of Hormuz persists, with Brent crude briefly breaking above $90 per barrel. Jefferies warns that if the impasse continues through this weekend or into next week, oil prices are unlikely to maintain their current moderate trajectory. Capital Economics believes that if the strait remains closed for an extended period and inventories continue to decline, the oil market could reach a \"tipping point\" in early Q4, potentially pushing oil prices to $120–$140 per barrel" datetime: "2026-08-11T10:53:56.000Z" locales: - [zh-CN](https://longbridge.com/zh-CN/news/295519665.md) - [en](https://longbridge.com/en/news/295519665.md) - [zh-HK](https://longbridge.com/zh-HK/news/295519665.md) --- # US-Iran Deal Remains Elusive; Analysts Warn Oil Prices Could Surge to $120–$140 The escalating stalemate in the Strait of Hormuz is putting pressure on oil prices to be repriced. Brent crude briefly surpassed $90 per barrel on Tuesday, a significant rebound from around $83 last weekend, though it remains below last month’s high of over $100 and the peak of more than $110 in May. Analysts warn that **if the blockade of the strait persists, the market will be forced to increase the probability assigned to a long-term closure, potentially driving oil prices further up to the $120–$140 per barrel range.** According to a previous article by Wallstreetcn, the prospects for US-Iran negotiations deteriorated further over the weekend. According to CCTV, US President Trump posted on social media on August 10 (local time) stating that he noted Iran was demanding compensation for losses suffered during military conflicts over the past five months. Trump stated, “I am likewise demanding compensation from Iran, and I have instructed my representatives to clearly include this demand in all future negotiations.” These remarks have further dampened hopes for a swift agreement to reopen the Strait of Hormuz, causing oil prices to climb again. ## Oil Prices Diverge from Supply Realities as Market Awaits "Tipping Point" Current oil prices do not yet fully reflect the supply tightening caused by the ongoing disruptions in the Strait of Hormuz. The gap between market expectations that negotiations will alleviate the crisis and the reality on the ground is widening. According to CNBC, Jefferies economist Modupe Adegbembo stated on Monday that traders still believe an agreement will eventually be reached to restore the flow of more oil and cargo through the strait. However, she warned that this optimism is "time-sensitive," and if the stalemate persists through this weekend or into next week, oil prices are unlikely to continue their current moderate trend. Kieran Tompkins, Senior Climate and Commodities Economist at Capital Economics, noted that oil prices remain relatively low, reflecting the market pricing in two scenarios simultaneously: a rapid restoration of energy transport or a long-term closure of the Strait of Hormuz. If the impasse continues, the market will have to raise the implied probability of a prolonged blockade, which could cause front-month crude futures prices to rise rapidly. Tompkins further warned that **if the strait remains closed and OECD oil inventories continue to decline rapidly, the oil market could hit a "tipping point" in early Q4—a stage where inventories can no longer absorb the supply shortfall, forcing demand down through higher oil prices. Based on historical experience, this phase could correspond to oil price levels of $120–$140 per barrel.** ## Buffering Factors Weaken as Upside Risks in Oil Market Intensify Multiple buffering factors that previously supported lower oil prices are weakening, including alternative export routes bypassing the Strait of Hormuz, weak demand, and phased production increases. At the same time, **the market’s sensitivity to negotiation progress is significantly higher than its attention to actual supply constraints.** As long as any signs of easing emerge, traders quickly bet on the resumption of shipping, pressing oil prices down. However, as negotiations fail to make substantial progress, this pricing logic is facing challenges. Amrita Sen, Founder and Head of Research at Energy Aspects, stated that the market cannot sustain current low oil price levels indefinitely. She believes that **the oil market’s recent reaction to negotiation progress has been overly optimistic. Actual supply side pressures remain significant, and coupled with continued attacks on regional infrastructure, the overall fundamentals for crude oil remain bullish.** If the stalemate in the Strait of Hormuz cannot be broken soon, **the core variable in market pricing may shift from "when the strait will resume navigation" to "how high the probability of a long-term blockade is." Once the latter becomes the dominant expectation, oil prices could undergo a new round of rapid revaluation.** ### Related Stocks - [USOI.US](https://longbridge.com/en/quote/USOI.US.md) - [USO.US](https://longbridge.com/en/quote/USO.US.md) - [BNO.US](https://longbridge.com/en/quote/BNO.US.md) - [SCO.US](https://longbridge.com/en/quote/SCO.US.md) - [UCO.US](https://longbridge.com/en/quote/UCO.US.md) - [XLE.US](https://longbridge.com/en/quote/XLE.US.md) - [VDE.US](https://longbridge.com/en/quote/VDE.US.md) - [IXC.US](https://longbridge.com/en/quote/IXC.US.md) - [XOP.US](https://longbridge.com/en/quote/XOP.US.md) - [IEO.US](https://longbridge.com/en/quote/IEO.US.md) - [IEZ.US](https://longbridge.com/en/quote/IEZ.US.md) - [OIH.US](https://longbridge.com/en/quote/OIH.US.md) - [XES.US](https://longbridge.com/en/quote/XES.US.md) - [PXJ.US](https://longbridge.com/en/quote/PXJ.US.md) - [CRAK.US](https://longbridge.com/en/quote/CRAK.US.md) - [ERX.US](https://longbridge.com/en/quote/ERX.US.md) - [ERY.US](https://longbridge.com/en/quote/ERY.US.md) - [DUG.US](https://longbridge.com/en/quote/DUG.US.md) - [MLPA.US](https://longbridge.com/en/quote/MLPA.US.md) - [03097.HK](https://longbridge.com/en/quote/03097.HK.md) - [03175.HK](https://longbridge.com/en/quote/03175.HK.md) - [JEF.US](https://longbridge.com/en/quote/JEF.US.md) ## Related News & Research - [W.Africa Crude - Nigerian offers steady](https://longbridge.com/en/news/295432536.md) - [RUBBER-Japan futures rise as higher oil prices offset soft Chinese tyre demand](https://longbridge.com/en/news/295070931.md) - [Oil rises amid supply-disruption concerns](https://longbridge.com/en/news/295158530.md) - [Oil extends declines as investors await outcome of US-Iran talks](https://longbridge.com/en/news/294907248.md) - [Oil steadies after two-day slump as investors eye Hormuz traffic](https://longbridge.com/en/news/294892991.md)