Oil's 15% collapse reveals the scale of geopolitical risk premiums
NG
Noa Gallagher
Bitcoin ETF · Apr 12, 2026
Source: The Digital Ledger Data Terminal
Expectations for at least one Federal Reserve rate cut this year increased to approximately 35% as oil prices collapsed. Brent crude tumbled 15.5% to $92.28 per barrel, the largest single-day decline since April 2020. The price drop follows a conditional two-week ceasefire between the United States and Iran, in which Iran committed to reopening the Strait of Hormuz. The reopening removes the immediate risk of supply disruptions in a waterway through which one-fifth of global oil shipments transit daily.
The removal of this geopolitical risk triggered a broad rally in risk assets. The Dow Jones Industrial Average rose more than 1,300 points, while Bitcoin reached $72,700. The decline in crude prices creates a disinflationary impulse by reducing gasoline and transportation costs, which alters the calculus for monetary policy.
Bitcoin ETF
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