Iran's Hormuz Terms Send Oil Prices Higher Amid Diplomatic Developments

Oil prices rebounded on Monday as traders reevaluated last week's sharp sell-off in response to diplomatic developments over the Strait of Hormuz.

The price of Brent crude rose by about 1% to $84.46 a barrel, while West Texas Intermediate (WTI) climbed to $78.79, partially recouping losses exceeding 7% from last week's trading session.

The rebound came after Iran announced that it was close to establishing a shipping arrangement with Oman but made clear that the reopening of the Strait would be conditional on significant concessions from Washington, including sanctions relief and compensation for war damage.

Citi raised its third-quarter Brent forecast to $80 a barrel from an earlier estimate of $75, suggesting that oil prices may temporarily hover in a higher range before supply normalizes.