Oil prices tumble nearly 20% in May — the biggest monthly drop since 2020. Here’s what’s next.
Energy
Oil prices dropped nearly 20% in May — the largest monthly decline since the COVID crash in 2020 — driven by optimism around a U.S.-Iran nuclear deal that could flood the market with additional supply. If a deal materializes and Iranian barrels return to market, OPEC+ discipline faces a structural test, extending the bear case for crude into Q3.
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↓ SHORT-10% target+5% stop4-8 weeks, into deal confirmation or breakdown
Short XLE or long-dated put spreads on OXY/MRO into a confirmed U.S.-Iran deal — high-beta E&Ps face further 8-12% downside if Iranian supply hits market in Q3.