This week, the oil market's price action has been pretty wild, looking like a setup.
It's reminiscent of the last time during the 'Saving Private Ryan' scenario—like an extreme rescue operation for downed pilots. Although, to this day, none of the rescued pilots have shown up, leading to rumors that the U.S. was actually there to dig up enriched uranium and got caught in a script.
This time, we have another downed aircraft that was rescued, but without any credible details, making it tough to tell if this is a U.S. play or if Iran is making moves on its own.
But terms like 'Iranian aggression' and 'U.S. defensive retaliation' really feel off, almost like it's all Iran's fault while the U.S. plays the victim. Regardless of who initiated it, isn't it strange that the U.S. is claiming to be invaded right by Iran's doorstep? You'd think Iran had landed on North America or something.
So this narrative might be aimed at justifying the military conflict's escalation to domestic audiences, trying to gain legitimacy within the ally framework, and seizing the moral high ground for future actions.
Right now, oil prices are indeed sitting at recent lows; even though the risk premium spiked after the dawn of conflict, it doesn't explain why oil remains below 90.
This leaves us with two possibilities:
1. Big money thinks this conflict is just a temporary blip, believing Iran is the one provoking, and Trump isn't looking to escalate further.
2. This is merely a temporary market mispricing, triggered by a sell-off in the stock market due to tail-end panic, leading to capital fleeing faster than the war risk premium can rise. Once the stock market stabilizes, we could see oil prices rebound significantly.
It's reminiscent of the last time during the 'Saving Private Ryan' scenario—like an extreme rescue operation for downed pilots. Although, to this day, none of the rescued pilots have shown up, leading to rumors that the U.S. was actually there to dig up enriched uranium and got caught in a script.
This time, we have another downed aircraft that was rescued, but without any credible details, making it tough to tell if this is a U.S. play or if Iran is making moves on its own.
But terms like 'Iranian aggression' and 'U.S. defensive retaliation' really feel off, almost like it's all Iran's fault while the U.S. plays the victim. Regardless of who initiated it, isn't it strange that the U.S. is claiming to be invaded right by Iran's doorstep? You'd think Iran had landed on North America or something.
So this narrative might be aimed at justifying the military conflict's escalation to domestic audiences, trying to gain legitimacy within the ally framework, and seizing the moral high ground for future actions.
Right now, oil prices are indeed sitting at recent lows; even though the risk premium spiked after the dawn of conflict, it doesn't explain why oil remains below 90.
This leaves us with two possibilities:
1. Big money thinks this conflict is just a temporary blip, believing Iran is the one provoking, and Trump isn't looking to escalate further.
2. This is merely a temporary market mispricing, triggered by a sell-off in the stock market due to tail-end panic, leading to capital fleeing faster than the war risk premium can rise. Once the stock market stabilizes, we could see oil prices rebound significantly.