“The market is depending on accurate information from the administration,” Andy Lipow, president of analyst firm Lipow Oil Associates, told Fortune. “And when a tweet is posted and deleted quite rapidly, it brings into question what exactly is happening.”
What exactly is happening, over the past few days, has depended entirely on which administration official you’re listening to.
The result of all the mixed messaging is a market that has swung 36% from peak to trough in two sessions—the largest such move since April 2020—driven less by the fundamentals than by the inability of traders to distinguish signal from noise when the executive happens to be the source of both.
The White House did not immediately respond to Fortune’s request for comment.
Lipow, who has tracked oil crises for decades, said this volatility is compounding an already extremely severe supply shock—one of the worst crises since the 1970s. Unlike 2022, when the International Energy Agency (IEA) released reserves after Russia’s invasion of Ukraine, the current disruption involves actual barrels disappearing from the supply chain entirely. Back in the early days of the Russian war, Russian oil never really vanished; rather, it got rerouted to China and India.
“This time there actually is a supply disruption,” Lipow said. “Production is being shut in throughout the Middle East, refineries are shutting down. That was just not the case in 2022.”
Easy math explains the skepticism: At roughly 20 million barrels a day of lost supply, the release covers about three weeks, or 20 days before the cushion runs out.
“Something has to be done,” Lipow said, “but it may not be enough.”
He added traders are more looking for signs of Iran targeting ships directly, although he said once the IEA oil comes onto the market, it will “almost certainly” bring prices down.
The West hasn’t faced such dire consequences yet, but could soon in transportation. Lipow said most airlines hadn’t hedged before the spike and are now trapped.
“You’re already seeing increases in ticket prices that started on Monday,” he said. “It’s almost too late to hedge your jet fuel prices because they’ve already spiked.” For truckers, railroads, and refiners, the calculus is the same: Hedge at $90 and risk overpaying if the war ends tomorrow, or stay exposed and risk $120 if it doesn’t.
Nobody knows which way this goes. But as of this week, the biggest single-day price swings in the oil market have been triggered not by Iranian missiles or IEA production decisions—but by a TV interview and a cabinet secretary’s deleted tweet.
The fog of war is coming from inside the White House and it’s costing the market millions.
