Hartnett: Gold and Oil Returns During War for 50 Years. (Gold Wins)
If Hartnett is correct, Buy Gold, not Oil
Best Geopolitical Hedges are Oil (best 3 mos after an event) and Gold (best after 6 months
-Michael Hartnett, October 2024
Contents
Era 1: Pre-Gulf War – Raw Reaction and Unmanaged Spikes
Era 2: Gulf War – The Strategic Realignment Begins
Era 3: Post-Gulf War – Managed Markets and Coordinated Suppression
A Shift Under Biden
Now: A Trump reinvigorates the Saudi Deal
Appendix: Summary of Phases
Gold and Oil Price-Returns During War
For starters: Any event short of literally closing the Hormuz Strait will not make sense to many in terms of Oil and Gold’s price action. Today’s reactions are an example. But it might make a little more sense after reading this.
In December of 2024 Michael Hartnett shared his data on the performance of Oil and Gold during Middle East wars and Oil supply disruptions related therein. As it turns out, this was a topic we had much experience in and felt very comfortable addressing in even more detail using Hartnett’s dataset as a tool. That premium post was titled: Hartnett’s History of Oil and Gold During Wartime with the discussion starting at the 39:03 time mark)
What always matters is the 6 months *after* the headline as Hartnett notes.
That analysis is more relevant now than ever. Here it is again with new materials broken out to give some perspective on current events in a much bigger picture way that should make navigating the present situation more productive. The bottom line for Goldifx: The US Saudi relationship has returned.