❎Oil is going out of control…

🛢But when oil goes above: 90-100$ - this is the beginning of an economic/inflation threat…

✅If oil trades high for a week/two - this affects 'inflation expectations', investors reduce risks fearing the consequences (they stock up on goods/services in advance which somewhat still supports the economy), but if the high price lasts a month or more - this is already a blow to the real economy…

❎Oil is the basic resource of the entire economy and everything depends on it: transportation, electricity, logistics, production, agriculture, and thus, in 1-2 months of high prices: goods become more expensive (inflation), people start buying less (decline in consumption), company profits plunge into the abyss (due to reduced demand and declining margins)…

⚠️Every serious and prolonged 'jump' in oil in the last 50 years has led to a recession in the economy (in the moment panic and decline/after - a machine and recovery):

1️⃣1973 - stagflation + recession due to the oil crisis caused by the 'Yom Kippur War' in the Middle East

2️⃣1979 - Iranian revolution

1990 - Gulf War

3️⃣2008 - oil soared to $147 in July, and by September Lehman Brothers collapsed

🤔Now just watch the quote: if it does not drop and trades steadily at current values or even above $100 - undoubtedly, there may be rebounds, local positivity, but now you will understand what consequences such a jump may lead to... 👀

🤔I think Trump will try to 'put out' the fire in the energy resource market and he may use various methods:

1⃣To leak through major media or officials 'rumors' that a peace agreement with Iran is being prepared and de-escalation | or to buy 'controlled experts' to calm market participants

2⃣To give orders for the US Navy to escort oil tankers in the Strait of Hormuz region

3⃣Force the European Union to lift the ban on energy resource imports from the Russian Federation (to fill the market with supply)

4⃣To pour 120 million barrels of oil from American reserves onto the market and achieve a price dump..

📈Locally, any of these measures may provoke sharp squeezes down in oil and upward moves in high-risk markets (in stocks and crypto), but this is a question of local volatility. Long-term prospects depend only on whether full tanker traffic through the Strait will resume or not (which is likely only after a complete peaceful settlement and end of the war), so the reaction may be local and misleading…

🍋At the current moment - this is all you need to know to navigate this issue 🥰