Global oil prices are predicted to remain in the “low $100s” for much of this year, even if the Strait of Hormuz reopens as early as next month, according to investment bank JPMorgan.
The bank said on Monday that supplies of oil in the region would not quickly return to normal service.
The analysis comes as oil prices rose following President Donald Trump’s remarks that Iran’s response to US proposals to end the war was “totally unacceptable”.
Tehran sent its response via Pakistan, which has served as a mediator between the two sides, calling for an immediate end to the conflict and guarantees of no further US-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 (£77.74) a barrel at one point before falling back to around $105.
The key Strait of Hormuz waterway has been effectively shut since shortly after the war began on 28 February, severely disrupting global oil and gas supplies.
Responding to Tehran’s terms, Trump posted on social media: “I have just read the response from Iran’s so-called ‘Representatives.’ I don’t like it – TOTALLY UNACCEPTABLE.”
Washington’s terms had included restoration of free transit through the Strait of Hormuz and the suspension of Iranian nuclear enrichment, according to US news outlet Axios.
Israeli Prime Minister Benjamin Netanyahu also said the war with Iran will not be over until its enriched uranium stockpiles are “taken out”.
A ceasefire announced in early April to allow time for peace talks has been mostly observed, despite occasional exchanges of fire.
On 21 April, Trump extended the truce indefinitely to give Iran time to present a “unified proposal”.
Energy prices have swung wildly since the start of the conflict, while Brent crude has risen back above $100 a barrel since the ceasefire came into effect on 8 April.
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,” it added, saying the bottleneck would likely shift from the “Strait itself to tanker availability, refinery ramp-ups and wider logistical constraints”.
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 US-Israeli strikes.
Major energy companies have seen their profits jump as oil and gas prices have soared in global markets.
On Sunday, Aramco said its earnings had jumped by more than 25% in the first three months of the year compared to the same period in 2025.
The Saudi Arabian energy giant’s cross-country pipeline has “proven itself to be a critical supply artery” and helped it avoid disruptions to shipping caused by the Iran war, said Aramco boss Amin Nasser.
Last month, BP reported that its profits for the first three months of the year had 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 was 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.
He added that the market had seen an “unprecedented supply loss of about a billion barrels of oil”.
Crude output by the Organization of the Petroleum Exporting Countries (Opec) in April fell by 830,000 barrels per day month-on-month to 20.04 million bpd, according to a survey by Reuters.
