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The Fourth Oil Crisis Has Erupted, New Opportunities for Wealth Are Emerging! 【Comparison Chart of Past Oil Crises and Stock Markets🖼️】
Due to the escalation of the US-Israel-Iran conflict, the Strait of Hormuz has been shut down, and 1/5 of the world's oil supply has disappeared.
⚠️ Note: Two of the four oil crises are related to Iran.
Let's take a look at the first three oil crises:
1️⃣ 1973 "Yom Kippur War" (First Crisis)
- Cause: OPEC embargo
- Oil Price: Directly quadrupled
- Stock Market: S&P 500 index plummeted about 45% over two years
- Lesson: This was the worst, triggering a long-term "stagflation," with the stock market continuously declining
2️⃣ 1979 "Iranian Revolution" (Second Crisis)
- Cause: Sharp decline in Iranian production + Iran-Iraq War
- Oil Price: More than doubled
- Stock Market: Initial market turbulence, S&P 500 experienced months of adjustment
- Lesson: High inflation forced the Fed to raise interest rates aggressively (Volcker Moment), and the stock market didn't fully recover until 1982
3️⃣ 1990 "Gulf War" (Third Crisis)
- Cause: Iraq's invasion of Kuwait
- Oil Price: Doubled in the short term
- Stock Market: S&P 500 dropped about 15% within 3 months
- Lesson: This was a "flash" crisis. With US military intervention (Desert Storm), oil prices fell back, and the stock market rebounded very quickly
💡 Summary: Which past crisis does the current situation resemble more?
Now, the Strait of Hormuz is completely blocked, and the supply gap is even more severe than the combined gaps of the previous three crises.
- Short-term: Risk aversion dominates, gold and crude oil surge, stock markets broadly decline
- Mid-term: Key depends on the Federal Reserve. If inflation spirals out of control again and rate hike expectations reignite, the scenario will resemble 1973.
Conclusion:
Keep cash ready. If extreme situations occur, it will be the time to buy the dip. The sharper the decline, the stronger the rebound😎