Past performance does not predict future results. Informational only, not investment advice.
Author notes a large high-conviction bearish flow in crude oil futures (USO), though cautiously cited as positioning is winding down. This supports the thesis that oil is vulnerable as geopolitical premiums unwind.
Oil futures curve is shifting from immediate backwardation to persistent structural scarcity as SPR depletion accelerates and the Strait of Hormuz closure continues. Future oil contracts are rising faster than spot, signaling the market is pricing in a prolonged supply crisis that could worsen into 2027, particularly as the SPR hits its floor and creates a second shock wave.
Oil shortage driven by strait disruptions and geopolitical escalation will surge crude prices. Supply constraints from blocked shipping routes, rising insurance costs, and strategic reserve refilling by major economies support undervalued crude oil that will spike either through geopolitical conflict or fundamental supply-demand imbalance.
Author is shorting oil due to a dual-pressure thesis: surging supply from Iran (Hormuz reopening), Venezuela, US shale, and potentially Russia (via Ukraine resolution), combined with structurally moderating demand driven by EV adoption, energy efficiency, and China's shift toward alternatives and self-reliance. The resulting oversupply should drive crude prices lower over several years.
USO has been dropping on false promises of a Middle East peace deal that will open the Strait of Hormuz toll-free. Trump is posturing about an agreement he needs to approve, but the Camp David signing fell through when Iran backed out. The strait will remain constrained by tolls regardless, meaning current optimism is unwarranted.
Falling global oil inventories, refinery capacity constraints, and strong Asian demand will trigger a supply shock. Once inventory buffers deplete, prices will surge as there are limited alternatives to increased production.
Oil prices spiked to $150 due to geopolitical tensions but historically all oil spikes retrace when conflicts resolve. Author expects war to end under Trump administration, driving oil prices lower and call options on USO sharply higher.
Oil at $150 is unsustainably elevated and will retrace when geopolitical tensions ease. Historical oil spikes have always retraced, and current prices are driven by temporary POTUS policy, making long-dated puts a favorable risk/reward trade.
One of the three biggest winning plays YTD contributing to the +107K realized gain, timed around the Iran war geopolitical event.
Oil has tanked to below $100/barrel due to market crisis, but the author believes a recovery is likely and bought 1,000 barrels at $96.73 cost basis for June delivery. A single positive catalyst could trigger a 5-10k profit overnight.
Author expects escalation in Middle East tensions and a delayed market realization of oil supply shocks. Current market highs ignore fundamental oil disruption risks that will surface by summer, triggering a major sell-off that benefits oil positions.
Oil prices are being ignored by the market and will see deterioration. Author plans to short USO via put options if prices hit $150, betting on a pullback in energy prices.
Strait of Hormuz closure and failed Israeli-Palestinian ceasefire will disrupt oil supply. Despite today's drop, the supply shock has not yet reached US markets; oil will surge within a week as tanker delays resolve and global demand responds to scarcity.
Opened short position on oil following ceasefire announcement, expecting price decline as geopolitical risk premium dissipates.
Crude oil is spiking in response to geopolitical tensions (Israel-Iran strikes). The author expects oil prices to remain elevated going forward, which could push CPI higher in the next report.
End of results.