Oil just had its worst month in six years on Iran peace hopes — short the big energy stocks if the deal lands
Oil prices just suffered their worst monthly drop in six years because President Trump says a deal with Iran is imminent. If a peace agreement opens the Strait of Hormuz — the world's most important oil shipping lane — oil could fall even further.
Idea
The Iran conflict has been propping up oil prices since February by choking off shipments through the Strait of Hormuz, which handles roughly 20% of the world's oil. Now Trump says a 'final determination' on a deal is coming, and the market is pricing in peace. Oil is already posting its biggest monthly decline since 2020 — but if a deal actually happens, the Strait reopens and millions of barrels per day flow back into the market, prices could crash even harder. Big oil companies like Chevron and ExxonMobil would see their profit margins squeezed. The risk-reward here favors the downside: the market has already started selling oil aggressively, and any concrete ceasefire announcement would be a second leg down.