Why isn’t oil falling if oil flows are back?

Speaking in Athens, the U.S. Secretary of State said Iran had lost control of the Strait of Hormuz and that oil flows through the strait were almost back to pre-conflict levels.
Yet oil prices remain stubbornly high, with October Dated Brent, the key benchmark for physical crude, trading around $117 a barrel on Wednesday, while Russian Urals crude was above $120 a barrel. 
Is the market simply pricing in the risk of strikes on Iranian energy and nuclear facilities?
That risk is keeping a floor under oil prices, but there may be an even bigger issue, with industry executives warning that global oil inventories are running dangerously low at less than 6 billion barrels, much of which cannot be brought to market quickly. 
More than 1 billion barrels have already been drawn down since the start of the Middle East crisis, and with the IEA preparing to release another 100 million barrels, it could still take time to rebuild global inventories even if the conflict ended tomorrow, keeping oil prices elevated. 
Another factor keeping oil prices high is the impact of Hurricane Isaias, which has forced Gulf of Mexico producers to shut in more than 510,000 barrels of crude a day, roughly a quarter of regional output.
The good news is that forecasters expect the storm to make landfall east of the main energy infrastructure along the Louisiana and Texas coasts late Friday or early Saturday. The bad news is that even a slight shift west could put more offshore production and energy infrastructure directly in its path.
What is next?
If the situation in the Middle East escalates again, oil could move sharply higher, especially if Iran tries to retaliate by disrupting the Strait of Hormuz or the Bab el-Mandeb through its proxies, or by targeting Saudi Arabia.
That could also increase the chances of another rate hike, even as the labor market deteriorates, which would normally give the Fed less reason to raise rates again at its October meeting.
For now, though, the market is still betting that cooler heads will prevail, which is supporting Treasuries and keeping the US dollar index steady. But that may not last long, with the bigger problems still there, including a huge fiscal deficit, rising debt and increasingly limited room for policymakers to maneuver.