Oil remains one of the world’s most strategic resources, serving as fuel, an industrial raw material, and a price benchmark for energy.
Key benchmarks are:
- Brent Crude: international reference, priced around 70 USD/barrel at the beginning of 2026.
- WTI (West Texas Intermediate): U.S. reference, trading around 65 USD/barrel.
Oil is extremely sensitive to geopolitical tensions, OPEC+ decisions, and global supply-demand fluctuations.
Current Economic Environment
Recent Catalysts
- Geopolitical Tensions in the Middle East
- Relations between the U.S. and Iran have significantly deteriorated.
- Deployment of U.S. naval vessels and military threats around the Strait of Hormuz, through which 20 million barrels transit daily, increase the risk of supply disruption.
- Price Increases Since January
- Brent briefly exceeded 70 USD/barrel, its highest level since last August.
- WTI followed the same trend (+14% since January 1), reflecting market nervousness amid geopolitical tensions.
- Expected OPEC+ Decision
- OPEC+ is meeting to decide on March production levels.
- Several delegates anticipate that the cartel will likely not increase production, limiting supply and supporting prices.
Sector Trends
- Global oil demand remains robust but sensitive to overall economic conditions, particularly industrial growth and transportation.
- Geopolitical tensions and logistical constraints (Strait of Hormuz) are key volatility drivers.
- OPEC+ decisions continue to strongly influence global supply and barrel prices.
In summary, oil currently benefits from high volatility and geopolitical support, offering potential price upside but also significant risks.
Investment Recommendation
Why Invest in Oil?
1. Short-term upside potential
- U.S.–Iran tensions and risks around the Strait of Hormuz could keep prices elevated.
2. Partial exposure via indices and oil equities
- Investors can gain exposure through:
- Major oil company stocks (ExxonMobil, Shell, TotalEnergies)
- Crude oil ETFs or commodity funds
3. Opportunity amid scarcity and regulation
- OPEC+ limiting production creates relative scarcity, supporting producer margins and valuations.
Key Risks
- Unpredictable geopolitical risks may cause extreme volatility.
- Sensitivity to OPEC+ decisions and non-member production levels.
- Potential impact of a global economic slowdown on energy demand.
Conclusion: Oil offers a strategic exposure opportunity in a tense geopolitical context with limited supply, suitable for investors prepared to manage volatility and capitalize on price spikes.