Oil plunges on ceasefire hope but tanks are running dry — buy the dip on Exxon and Chevron
Oil prices have fallen 20% from their peak as investors bet on a US-Iran ceasefire that could reopen the Strait of Hormuz. But an Exxon executive just warned that physical oil stockpiles are about to hit all-time lows, which could send prices roaring right back up.
Idea
The market is pricing in a best-case scenario — a lasting ceasefire that reopens the Strait of Hormuz. But the Strait is still closed right now, and Exxon's Neil Chapman says inventories will soon hit all-time lows, with physical Brent cargo prices potentially spiking to $150–160 per barrel. That fundamental supply squeeze hasn't gone away just because diplomats are talking. When reality catches up with hope, oil and the companies that produce it tend to snap back fast. Think of it as buying umbrellas when everyone assumes the rain will stop — but the storm is still overhead.