Rising Middle East tensions keep pushing oil higher — ride the energy wave
Recent military clashes between the U.S. and Iran are making investors worry that a peace deal will fall apart, causing oil prices to rise for three straight days. This rising oil cost is also causing overall inflation to tick higher across the economy.
Idea
When military conflicts threaten a major oil shipping region like the Strait of Hormuz, the price of oil usually shoots up because markets fear a disruption to the global supply. Because oil is now rising for three consecutive days, this indicates a strong trend rather than just a single day's panic. Furthermore, higher oil prices naturally push up inflation, which makes energy stocks a great shield for your portfolio against rising costs elsewhere. As long as the geopolitical tension continues, oil companies are positioned to keep benefiting from elevated prices.