Oil prices were climbing early on Monday morning after a fresh escalation between the U.S. and Iran over the weekend. The price rise was relatively delayed, as markets continue to price in a potential peace deal while discounting more bullish geopolitical catalysts.A growing number of analysts have been arguing that markets are being too optimistic about a quick return of Hormuz traffic and too complacent about the continued drawdown in global inventories to multi-decade lows.At the time of writing, Brent Crude prices were up by 1.18% at $72.84 per barrel, while the U.S. benchmark, WTI Crude, was up 1.73% at $70.43.The latest price movement appears to suggest that the market is concerned about a reduction in tanker traffic through Hormuz following attacks on two commercial vessels on Thursday and Friday last week, and a further flare-up over the weekend.The Thursday attack on the container ship Ever Lovely prompted some shipowners to pull back and wait for additional information about how safe transiting the Strait is. The U.S. military on Friday carried out strikes on Iran in response to the attack on the vessel.On Saturday, an Iranian attack on a Panama-flagged oil tanker, Kiku, while it was transiting the Strait of Hormuz prompted additional strikes by the U.S. forces. After the flare-up this weekend, the U.S. and Iran appear to have agreed to cease attacks ahead of tentatively planned new talks this week. “Participants appear to be shrugging off these developments, instead focusing on what a continued recovery in oil flows would mean for the global balance,” ING’s commodities strategists Warren Patterson and Ewa Manthey warned in a note on Monday.“This complacency is odd and clearly leaves significant upside risk if the supply recovery proves slow – or if we see significant re-escalation. While the oil market is technically in oversold territory, momentum appears to still be to the downside,” they added.ING’s strategists continue to believe “the market is too optimistic about the timeline for a recovery in Persian Gulf supplies.”The recent price movement suggests that reality might be setting in at last.By Tsvetana Paraskova for Oilprice.comMore Top Reads From Oilprice.comChina’s LNG Buying Rebounds as Summer Power Demand SurgesAustralian Gas Exploration Surges as Energy Security Takes Center StageAdani Targets 10 GW Nuclear Power Capacity in India by 2035