Diplomatic efforts between Iran and Oman have made initial progress, with oil shipments through the Strait of Hormuz quickly recovering to about 75% of pre-war levels. The market has begun to price in peace expectations, with Brent crude falling over 6% this week. However, with damaged refining facilities and critically low diesel inventories, diesel crack spreads remain at historical highs, indicating that the energy crisis is shifting from crude oil shortages to refined product tightness.