Oil collapsing on Iran peace hopes — ride the crude selloff lower
Oil prices are cratering — Brent just had its worst month in six years — because President Trump says a deal to end the Iran conflict is imminent. If a ceasefire is struck, the Strait of Hormuz could reopen and a huge amount of oil supply would flood back into the market.
Idea
Oil has been in freefall because the market expects a US-Iran ceasefire to reopen the Strait of Hormuz, one of the world's most critical oil shipping routes. Even though the strait has been closed since February, a deal would unleash pent-up supply that's been sitting on the sidelines. Brent crude just posted its worst monthly decline in six years, and Trump says a final decision is imminent — meaning the selling pressure could intensify once a deal is officially announced. The weak US economic data is also dragging down energy demand expectations. The trend is clearly downward and any deal confirmation could spark another leg lower.