Oil prices climbed in early Asian trade on Friday as skepticism grew that U.S.-Iran negotiations would produce a breakthrough, with all the major sticking points still unresolved despite claims of progress.At the time of writing, Brent futures were trading at $104.80, 2.13% higher on the day, while WTI futures climbed to $97.99, up 1.70%.The price spike comes after both benchmarks fell roughly 2% on Thursday to their lowest levels in nearly two weeks, as traders briefly priced in the possibility of diplomatic progress. It seems that sentiment has shifted overnight after conflicting signals emerged from negotiators.A senior Iranian source told Reuters that no agreement had been reached, but the two sides had narrowed some gaps. Meanwhile, U.S. Secretary of State Marco Rubio said there had been “some good signs” in talks, but warned that any Iranian attempt to impose restrictions on the Strait of Hormuz would be unacceptable.Six weeks into the ceasefire, efforts to secure a lasting agreement have made little meaningful progress, with oil markets frequently reacting to claims from both sides before rebounding when nothing comes to fruition.Meanwhile, the ever-tightening state of physical markets has sparked major inflation fears globally, particularly as elevated fuel costs ripple through transportation and manufacturing sectors. Global oil inventories have been falling at a record pace, and countries around the world are implementing emergency measures to counter rising prices.Underscoring the market’s anxiety, ADNOC’s chief executive yesterday warned that full oil flows through the Strait of Hormuz may not resume until at least the first or second quarter of 2027, even if hostilities were to end immediately. The UAE, having left OPEC, is now aggressively focused on increasing its export capacity beyond Hormuz with a new pipeline.In the short term, the only real solution for oil markets remains the reopening of the Strait of Hormuz, and markets will be nervously awaiting either a diplomatic breakthrough or a major military escalation.By Josh Owens for Oilprice.comMore Top Reads From Oilprice.comUK Adds New Tax Pressure as Energy Security Concerns GrowIndonesia Tightens Grip on Key Commodity ExportsThree Supertankers Carrying 6 Million Barrels Exit Strait of Hormuz