The U.S. and Iran may be close to finalizing a deal that would end almost four months of fighting and allow Persian Gulf crude to once again flow freely to global markets, but experts say high global oil prices are likely to stick around.
Ninepoint Capital released its mid-year outlook on Wednesday that predicts a US$80 floor price for West Texas Intermediate crude even with a reopening of the Strait of Hormuz. The narrow waterway, through which roughly one-fifth of the world’s crude supply normally transits, has been effectively cut off since the U.S. and Israel launched their attacks on Iran in late February.
“Even when an agreement is reached and the strait reopens, it will take weeks and months for normalized tanker traffic to resume,” said senior portfolio manager Eric Nuttall.
Global inventories will need to be restocked, creating sustained demand, he added. The investment firm estimates that the world has lost more than one billion barrels of oil since the conflict began.
“One of the biggest misperceptions of the market is that equities have already reflected the rally in energy prices. While the stocks have appreciated in price, our valuation suggests that stocks are discounting closer to US$65 WTI, below our view of the floor price for oil,” Nuttall said.
“At $80 WTI, the companies will generate significant free cash flow, most of which will be returned to investors in the form of share buybacks and dividends.”
A draft of the U.S.-Iran agreement, expected to be signed on Friday, calls for toll-free passage through the strait for 60 days, while negotiations over Iran’s nuclear program proceed, and does not preclude fees in the future. Iran would be able to sell its own oil freely under the interim deal.
West Texas Intermediate crude was hovering around US$76 per barrel on Wednesday, about US$9 above where it was before the war started but US$38 below its wartime high in April.
A report from TD Economics earlier this week said the magnitude of the recent crude price drop was “more muted” than past episodes based on signals alone.
“This suggests a meaningful portion of de-escalation had already been embedded in prices ahead of the formal announcement,” economist Marc Ercolao wrote.
A return to pre-conflict conditions will not be immediate, he said.
“While the agreement eases immediate supply risks, the recovery in oil supply will likely be too slow to significantly alter the near-term fundamental picture,” said Ercolao.
U.S. crude and product stocks are below seasonal norms and China has begun tapping its reserves to bridge supply gaps.
“This suggests physical market tightness will persist over the next couple of months, even as sentiment softens,” said Ercolao.
“In this sense, we expect WTI prices to be prone to bouts of upward pressure and to remain in the US$80-90 per barrel range.”
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Lauren Krugel, The Canadian Press
With files from The Associated Press
This report by The Canadian Press was first published June 17, 2026.
