Normally, the prospect of reopening Hormuz would be bearish for oil.  

While Brent had fallen below $80 earlier this month as investors anticipated an Iran-Oman arrangement, it subsequently climbed as the diplomatic picture became less certain.

The latest move above $90 is less a bet that Hormuz will remain permanently closed than a warning that normalisation could take much longer than markets initially hoped.

Energy is the most visible component. Hormuz normally carries roughly one-fifth of global oil consumption and a major share of global LNG trade, making disruption there unusually consequential for energy markets. Reuters has cited the waterway's normal role in carrying roughly a fifth of global oil and LNG flows.

But higher energy prices feed into virtually everything that moves, so why a temporary energy shock can become an inflation problem.

The market is caught between diplomatic optimism and physical reality.

Iran and Oman have moved toward an arrangement, but Tehran says the waterway will not simply reopen without further conditions.

Meanwhile, Washington's position remains difficult to reconcile with Iran's demands.

That uncertainty. But even a successful agreement would not immediately erase the damage already done.

The Strait can reopen in a day. Global supply chains cannot.

That is the significance of the UBS stress indicator: it captures the economic aftershock that oil prices alone can miss.

If Hormuz traffic normalises, energy markets could recover relatively quickly. Freight, inventories, insurance and manufacturing may take considerably longer.