14-Day Ceasefire With Iran: Sell Oil And Buy Oil Companies

Multiplo Invest3.02K FollowersFollow5ShareSavePlay(6min)CommentsSummaryI reiterate a sell recommendation on oil-tracking assets like USO and a buy on oil company assets such as XLE and Petrobras.The 14-day Iran ceasefire has eased catastrophic risk, reopening the Strait of Hormuz and causing oil prices to fall below $100.The gap between oil prices and oil company equities is expected to close, with oil companies benefiting from sustained higher cash flows in upcoming quarters.Key risk remains potential conflict re-escalation, but current market action supports the asymmetric trade favoring oil companies over oil price trackers. Sunshine Seeds/iStock via Getty Images Investment Thesis I reiterate the recommendation to sell assets that track oil and buy assets that track oil companies. Fortunately, the Iran conflict did not escalate into a catastrophic situation, and a 14-day ceasefire was announced. My intention withThis article was written byMultiplo Invest3.02K FollowersFollowMore than 7 years of experience in equity analysis in LatAm. We provide our clients with in-depth research and insights to help them make informed investment decisions.Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.