Where It All Goes Down
Bronze-Age Troy and its surroundings
The Iliad takes place in the tenth year of the Trojan War. The Trojan War, as you'll know from the Backstory section of our summary of Book 1, involved a massive army of Achaians (a.k.a. Greeks) who crossed the sea to lay siege to Troy, a city in modern Turkey. Their stated goal was to get back Helen, the wife of the Achaian king Menelaos, but most of the warriors were in it for plunder – which they would get when they captured Troy.
This situation leaves practically no way out for either the Trojans or the Achaians. The Trojans don't have anywhere else to go; they are fighting for their lives and the freedom of their families. The Achaians could go home, except that it would seem like a waste after spending so long at Troy. (When the Trojans counterattack and try to burn the Achaians' ships, this threatens to make the Achaians even more stranded, and locked into war.)
The other factor prolonging the war is the involvement of the gods, most of whom have a stake in the war, one way or the other. When you mix all these ingredients together, you get two sides that are incredibly tired of the war, yet also desperate for a way to bring it to an end – even if this means more daring attacks. At the same time, the high level of tension makes it easy for them to start fighting among themselves.