US-Iran Deal Hopes Fading: Oil Prices Soar as Global Reserves Dwindle

Oil prices are on the rise again as hopes for a US-Iran deal dwindle. The lack of progress in negotiations has left investors pessimistic, with Brent crude breaching $90 a barrel and US oil prices topping $83. Industry experts warn that global oil reserves are running low and another price spike is imminent if stockpiles aren't refilled soon.

Tuomas Malinen, a Finnish economist and professor at the University of Helsinki, estimates that without 'price manipulation' from the US releasing its oil reserves, crude prices would likely be trading around $150 to $200. This would cause severe demand destruction, leading consumers to pull back on oil products and potentially pushing the US economy into recession.

Malinen also speculates that a 'sudden stop' in oil flows from the US Strategic Petroleum Reserve could send oil prices skyrocketing, causing global energy systems to go haywire. HFI Research warns of two possible scenarios: Iran gaining control over the Strait of Hormuz or the US escalating against Iran, both of which would lead to extremely elevated oil prices.