Public trading strategy
Iran ceasefire is over and strikes could escalate — hedge with oil
Thesis
The collapse of the Iran ceasefire introduces fresh geopolitical risk into energy markets. Iran sits on some of the world's largest oil reserves, and any military action or infrastructure targeting raises the threat of supply disruptions. Even if no actual disruption occurs, the fear premium alone tends to push oil prices — and oil company stocks — higher in the days following such announcements. This is a classic news-driven fear spike trade.
Strategy approach
Build a rule-based strategy that enters long USO on D1 when WTI crude oil futures (CL=F) close up >2% on a day where the VIX also rises above its 10-day average, suggesting a geopolitical fear bid. Exit after 10 trading days or on a 4% trailing stop.