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You know how sometimes you hear something and immediately think, “Oh, that’s gonna leave a mark?”
That’s exactly what happened when President Donald Trump made his comment about the Strait of Hormuz — basically saying China needs it open, but we don’t.
The second he said it, I looked over at the market and watched it dump off. Wrong thing to say, Donald. And with traders heading into a Friday close, it only added fuel to the sell-first mindset.
Now, here’s the thing: He’s not wrong. It is true. But markets don’t care about technically correct when it sounds like geopolitical brinkmanship. They just don’t want to hear it.
There’s also a deeper layer here. Markets are full of people primed to expect the worst. I’ve been there myself — being a doomer does nothing but hold you back.
And the irony is there’s too much money riding on markets going up for the default state to be doom. Still, all it takes is the wrong headline at the wrong time to trigger an emotional overreaction.
Why Oil Prices Keep Climbing
The bigger picture is actually more interesting than the headline reaction.
The U.S. supplies the world with a massive share of its oil, gas and propane.
It’s a lot more than most people realize, especially when it comes to LNG exports and certain regional markets that rely heavily on U.S. supply.
That role becomes even more important when a chokepoint like the Strait of Hormuz is threatened.
More demand shifts our way and when demand rises, price follows. That’s why West Texas Intermediate Crude keeps climbing.
Knowing how central we are to the global energy map also helps explain why the market responds so violently to geopolitical tremors.
Energy, rates, inflation and politics are now tightly linked, creating crosswinds that can whip prices around far faster than fundamentals alone would justify.
The Natural Gas Paradox That’ll Make Your Head Spin
Here’s where it gets truly bizarre.
In places like the Permian Basin, they produce so much natural gas that we don’t have enough pipeline capacity to shove it to the coast, convert it to LNG and ship it out.
When every pipe is full and the wells keep producing, the only way to move the gas is to pay someone to take it.
That’s how you end up with the West Texas spot prices hitting negative $9.60. Producers were literally paying people to haul the gas away.
Negative pricing sounds insane, but it happens when infrastructure bottlenecks trap supply with nowhere to go. Meanwhile, oil and gasoline are expensive — same energy complex, completely different logistical realities.
It’s a reminder that markets react to perception first and mechanics second. Headlines can move everything in minutes, but once the dust settles, the deeper structural forces are what actually drive the long-term trend.
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Geof Smith
Geof Smith TradingÂ
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Disclaimer: We develop tools and strategies to the best of our ability, but we can’t guarantee the future. There is always a risk of loss when trading. Past performance is not indicative of future results. Since LIVE trading began on 9/18/25, there have been 24 trades, with 20 winners and 4 still open, continuing the undefeated streak. In LIVE trading, the average return has been 32.03%, and the average hold time has been 17 days.
