Oil Prices Might Not Go Back to Normal Anytime Soon

Although the exact details have not been released, the deal reportedly includes a 60-day cease-fire during which the two sides will negotiate a more permanent settlement. Since the announcement, the price of oil has fallen to about $80 a barrel, the lowest point since early March. But there’s a big difference between reopening the Strait of Hormuz on paper and resuming the flow of oil through it. A return to the pre-war status quo is still very far off—if it ever happens at all.The most obvious barrier to the smooth flow of oil is that the two sides seem to have conflicting accounts of what the deal actually says, calling into question whether it will be honored. The Trump administration has insisted that it will consider the strait reopened only if Iran agrees not to impose tolls on passing ships. But yesterday, after the cease-fire was announced, Iranian officials said that they would charge “fees” on transiting ships—which sounds an awful lot like a toll. Another point of contention: Iranian officials have said that the cease-fire agreement includes a cessation of Israel’s military activities in Lebanon, whereas American officials have said the opposite.[Read: The U.S. and Iran might actually have a deal]If these disagreements are not settled, the deal could collapse before it is even implemented. And even if the deal is implemented, it could fall apart down the line. The two sides are far apart on crucial issues, including Iran’s nuclear program. Trump told The New York Times on Sunday, for example, that if Iran does not agree to end the program, attacks on Tehran will resume.The result is a veil of uncertainty that could dissuade oil producers from resuming operations, insurance companies from reducing cur