Tariffs, Iran, and Oil: A Plausible Scenario
Contributed Opinion

1. Statements and opinions expressed are the opinions of the author and not of Streetwise Reports, Street Smart, or their officers. The author is wholly responsible for the accuracy of the statements. Streetwise Reports was not paid by the author to publish or syndicate this article. Streetwise Reports requires contributing authors to disclose any shareholdings in, or economic relationships with, companies that they write about. Any disclosures from the author can be found  below. Streetwise Reports relies upon the authors to accurately provide this information and Streetwise Reports has no means of verifying its accuracy.

2. This article does not constitute investment advice and is not a solicitation for any investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Each reader is encouraged to consult with his or her personal financial adviser and perform their own comprehensive investment research. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company.

For additional disclosures, please click here.

Clivemaund.com Disclosures

The above represents the opinion and analysis of Mr. Maund, based on data available to him, at the time of writing. Mr. Maund's opinions are his own, and are not a recommendation or an offer to buy or sell securities. As trading and investing in any financial markets may involve serious risk of loss, Mr. Maund recommends that you consult with a qualified investment advisor, one licensed by appropriate regulatory agencies in your legal jurisdiction, and do your own due diligence and research when making any kind of a transaction with financial ramifications. Although a qualified and experienced stock market analyst, Clive Maund is not a Registered Securities Advisor. Therefore Mr. Maund's opinions on the market and stocks cannot be construed as a recommendation or solicitation to buy and sell securities.

So much happened last week that it is difficult to know where to begin in assessing it all, but oil is perhaps as good a place to start as any because it is so important and because it fell so hard and has arrived at a critical juncture.

As it happened oil did pretty much as predicted in the last Oil Market update posted on the 10th March which called for a countertrend rally off support and then, in the absence of an attack on Iran, a potentially devastating plunge. Plunge it did last week, but importantly it still has not breached key "last ditch" support as we will now proceed to see.

On the latest 6-month chart for Light Crude, we can see the savage plunge that occurred on Thursday and Friday, dropping by almost $5 or 7.4% on Friday alone. This plunge followed a weak countertrend rally up to its falling 200-day moving average. The drop sliced through support at the September lows as if it wasn't there and took the price down to a critical support level at and above $60.

Why the support at and above the $60 level is so important can clearly be seen on the 5-year chart.

This chart shows that a giant potential top pattern has formed above this level since mid-2021, with the price bouncing off of it repeatedly, so it is clearly a key level and if it fails oil could drop like a brick.

The reason why oil should drop so hard is easy to determine. The tariff war has "gone nuclear," and since it guarantees an economic depression, it means greatly reduced demand for oil. However, there is something else big going on over the short to medium term that could "Trump" these negative factors.

As we know, Israel's dearest wish, beyond exterminating and driving out the Palestinians, is to destroy Iran so that it can become the dominant force in the Middle East. Ordinarily, such a small country would have no chance of doing this, but it has a big henchman that it controls, who it believes will do the job for it.

Israel rules the U.S. and one big reason that Trump was selected as President is so that he can get the Iran problem sorted. This is why a large number of B2 Stealth bombers and other aircraft have been flown to Diego Garcia in the Indian Ocean, which is within striking distance of Iran — probably so that they can drop tactical nukes on Iran's supposed nuclear sites.

Apparently, an attack is to be expected soon, a matter of weeks or, at most,t months, and while the outcome of it is by no means certain, we can be sure that it will result in massive chaos and destruction, not just in the region itself but to the world economy, and it is worth watching this interview Iran Attack Ends in Catastrophe about this subject.

The reason for mentioning this is that any such attack would almost certainly result in Iran blocking the Straits of Hormuz, through which some 20% of the world's oil flows, which would trigger a huge spike in the price of oil, leading to a global economic meltdown which is a desirable objective if your goal is to bring about a Great Reset where the masses clamor to be rescued and are rescued — at the price of accepting the new CBDC system.

This means that we could be in for a period of unprecedented volatility in the oil price with it initially plunging, perhaps to the $30 area pre an attack on Iran and then, once the attack happens, it turns on a dime and goes roaring up to say $150.

From a trading standpoint, it makes sense to short oil if it drops below $60 with a close overhead stop, exit a short position if it plunges to say $20 - $30 and then switch to long for the "bomb Iran" trade. This could all happen within the space of a few weeks or a month or two.