Oil prices rose more than 1% on Tuesday as hopes for a US-Iran agreement to end the conflict and reopen the Strait of Hormuz weakened after US President Donald Trump demanded compensation from Tehran for damages.

Brent crude futures climbed $1.40, or 1.6%, to $89.12 a barrel, while US West Texas Intermediate crude gained $1.35, or 1.64%, to $83.48 a barrel.

Both benchmarks surged more than 5% on Monday, reaching their highest levels since July 31, after Trump responded to Iran’s conditions for a potential peace agreement with demands that Tehran compensate people killed in wars, attacks and protests.

Trump later claimed that the United States controlled the Strait of Hormuz and that US forces had cleared the strategic waterway of Iranian mines.

The latest statements have raised doubts over whether Washington and Tehran can reach an agreement that would allow shipping through the key energy route to return to normal.

“There appears to be a gulf, no pun intended, between the US and Iran over what any agreement would actually look like,” said Tim Waterer, chief market analyst at KCM Trade.

He said the uncertainty was reversing some of the optimism seen in oil markets last week and giving crude prices a stronger upward bias.

The energy market is also facing pressure from renewed security concerns around major Middle Eastern shipping routes.

Saudi Aramco has postponed the restart of its Jazan refinery, which has a processing capacity of 400,000 barrels per day, until August 30 after Yemen’s Houthis claimed responsibility for two attacks on the facility on Sunday.

The attacks have increased concerns about disruption around both the Strait of Hormuz and the Bab el-Mandeb, another critical route for global energy shipments.

Waterer said even temporary restrictions or the possibility of further attacks could keep insurance costs high and force shipping companies to use longer routes, limiting energy flows in the near term.

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Analysts at Barclays said crude oil and refined-product net exports through the Strait of Hormuz averaged around 3 million barrels per day during the week ending August 7, down sharply from 4.4 million barrels per day in the previous week.

Shipping data also showed a significant decline in maritime traffic. Only six vessels passed through the Strait of Hormuz on Monday, compared with a 10-day average of about 11 vessels.

Despite the restrictions, some oil continues to move through alternative arrangements, including ship-to-ship transfers and overland routes.

IG analyst Tony Sycamore said the market could remain relatively detached from the disruption as long as alternative flows continue, with crude prices potentially remaining within a broad range of $75 to $95 a barrel.

Meanwhile, the Abu Dhabi National Oil Company has offered spot crude through a tender, marking its eighth such offering since the beginning of June.

The UAE state-owned energy company has been seeking ways to move crude from inside the Strait of Hormuz as disruption continues to affect regional oil logistics.

The latest developments underline the growing sensitivity of global energy markets to the standoff between Washington and Tehran. Any prolonged closure or severe restriction of the waterway could further reduce global oil supplies and put additional upward pressure on prices.

For now, traders are closely monitoring US-Iran negotiations, shipping activity through the Strait of Hormuz and security developments around key Middle Eastern energy infrastructure.