Oil crashing on Iran deal hopes and Strait of Hormuz reopening — keep shorting the energy patch
Oil prices just suffered their worst monthly drop in six years because President Trump signaled a U.S.-Iran deal is imminent. If an agreement is reached, the Strait of Hormuz — a narrow waterway that carries roughly a fifth of the world's oil — could reopen, flooding the market with supply.
Idea
The Iran war shut down the Strait of Hormuz in February, choking off a huge portion of global oil supply and spiking prices. Now Trump says a final decision on a deal is coming, and the market is pricing in a potential reopening. Brent crude is already posting its biggest monthly loss in six years, but the move may not be over — if a deal is formally announced, the remaining 'war premium' baked into oil prices could evaporate quickly. Energy stocks (Exxon, Chevron, etc.) would also feel the squeeze because their profit margins are directly tied to the price of crude.