Oil, in real terms, is the cheapest asset out there. On a base index of 100, oil is trading at around 82. In contrast, Apple stands at 102, the S&P 500 at 115, gold at 139, and Bitcoin at 152. If you believe the Iran–Israel threat is fully neutralized, then maybe you hold off on buying. But I don’t buy that narrative. The threat is existential, one of them is going to break. Ukraine and Russia also remain in sharp focus. The EU is on its 18th round of sanctions, each one more self-defeating than the last. U.S. influence is waning in Ukraine. If sanctions escalate, especially real oil sanctions, expect meaningful price impacts. In that context, oil prices are poised to climb. Technically, I think we’re heading back to retest the WTI high of $135. That won’t happen overnight, but we’re now entering a long-term uptrend following a correction from $135 down to $55. Markets are short. During the 12-day Iran-Israel war, oil tried to break above $75.50 multiple times, only to close below. Once that trendline is broken with conviction, massive short-covering will follow. Inventories are tight, and we’re entering dual demand seasons, summer and winter. I see this as the beginning of a multi-year bull cycle.
Can the US Fed Cut Rates Amid Inflationary Sentiment?
Rate cuts are coming. The U.S. must refinance $9 trillion in debt and rising yields make this unsustainable. Treasury rates are nearing 5%. The Fed will be forced to cut, regardless of inflation levels. Trust in U.S. Treasuries is eroding and alternatives like digital assets or stablecoins are being explored. Liquidity will return, the dollar will weaken, and inflation will rise. The market knows this. That’s why everyone’s buying the S&P.