Fed Sees Oil Prices Cooling Despite Renewed Iran War

The Federal Reserve still thinks energy prices are headed lower even as missiles are flying again in the Middle East.

New York Fed President John Williams said Thursday that the market's expectation for oil prices to ease over the next six to 12 months remains "a pretty reasonable baseline," despite the collapse of the U.S.-Iran ceasefire framework and renewed attacks threatening energy flows through the Strait of Hormuz.

That optimism may prove difficult to maintain.

Oil markets have spent the past week whipsawing between hopes for diplomacy and…