Oil’s Most Volatile Day in History

The most volatile day in oil market history came and went this week, with crude prices swinging wildly after President Trump told CBS News he was "thinking about" seizing control of the Strait of Hormuz. West Texas Intermediate crude, which had spiked toward $120, fell more than 6% on the news and settled around $85. The whipsaw captured a market trying to price in a war that keeps changing shape—and a president who keeps changing his signals.

The Iran War and the Oil Wildcard

The Strait of Hormuz carries roughly 20% of the world's oil supply through a 21-mile chokepoint. When Trump told CBS he was considering taking it over and indicated the war would be over soon, oil markets reacted instantly. Anthony Scaramucci, who worked in Goldman Sachs' commodity division, explained that production shutdowns in Saudi Arabia and Qatar can't be reversed quickly: "It takes about three to six weeks to get it back up and running." Tom Ellsworth noted that the pre-war range of $67–$74 was profitable for most producers, and that the spike was driven by uncertainty rather than fundamentals.