The 14-point memorandum signed by the U.S. and Iran is not a final peace treaty, but rather a commitment to continue negotiating over the next two months. This ambiguity leaves the reopening of the Strait of Hormuz and the return of 13 million barrels per day of shut-in production contingent on the success of these ongoing talks. For now, the agreement has primarily served as a political lever to pull U.S. gasoline prices below $4 per gallon, while granting Iran access to a $300-billion reconstruction fund and vital sanctions waivers.

Despite the International Energy Agency’s forecast of a 8-million-bpd supply surge in 2027 against a 2-million-bpd demand increase, a total market crash remains unlikely. Global inventories are currently at their lowest levels since 1990, with the U.S. Strategic Petroleum Reserve sitting at a 1983-low. As nations move to replenish these critical stocks, this buying pressure will act as a structural floor for prices. Ole Hansen of Saxo Bank notes that with 2027 Brent futures trading around $75—well above pre-war levels—the market is betting that supply constraints will persist. Without a resolution to the underlying nuclear tensions, the geopolitical risk premium has merely shifted, not vanished.