Paul Tudor Jones says he is long oil and thinks it can rally another $20 to $25 because of the U.S.-Iran conflict. He expects no resolution before the November midterm elections and warns that equities would react badly to such a rally.
Hedge fund manager Paul Tudor Jones said he is bullish on oil and thinks it can rally another $20 to $25. The founder and chief investment officer of Tudor Investment spoke on CNBC's "Squawk Box" on Tuesday. He ties the view to the U.S.-Iran conflict.
A rally would test the 2026 high
Western Texas Intermediate crude futures were trading at around $92.50 on Tuesday morning. A rally of the size Tudor Jones describes would push U.S. oil above its previous closing high for 2026 of just under $113 per barrel.
Tudor Jones said that if it happens, the equity market would "absolutely totally hate it". Equities were able to relatively manage higher oil prices earlier in the year, and the S&P 500 fell only just over 7% at its trough in late March, after the war began on Feb. 28.
How oil got here
U.S. oil prices jumped in March and peaked in early April. They then fell below $70 per barrel in June. Prices started rising again in July as the conflict heated up and the status of the Strait of Hormuz stayed unclear.
Oil hit a recent high of almost $106 per barrel in September, though it has traded off those levels since.
Midterms and beyond
Tudor Jones thinks it is too late for a resolution before the midterm elections. He believes President Donald Trump will seek peace after voters cast their ballots.
He also said 2027 in particular may be difficult for the stock market, as investors digest increased equity supply from megacap tech IPOs.
Source: CNBC
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