Evercore's Roger Altman: We may be approaching a tipping point in oil

Market complacency masks an imminent oil tipping point. Supply destruction & drained inventories set the stage for a rapid spike toward $150. This is the decade's second major inflation shock. It will trigger a sharp, negative repricing in equities & bonds *before* economic data turns. The pain trade is higher yields and lower stocks. The current strong economic backdrop is a trap for longs.

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Evercore's Roger Altman: We may be approaching a tipping point in oil

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wti

We're about to see over the next two weeks substantially higher oil prices... the paper price will go up a lot, a lot.

4/13/2026 8:34:50 PM	medium term up	20 days later	+16.59%	+16.59%

Why is the stock market shrugging off headwinds like $106 oil, rising rates, and geopolitical uncertainty in Iran?

Speaker1
Roger Altman

The big question is whether we are at a tipping point in the oil market, with 12-14 million barrels per day taken out of supply and cushioning inventories drawn down, potentially leading to substantially higher oil prices in the next two weeks.

Oil experts expect the spread between physical and paper crude to widen, then paper prices will rise a lot.
Roger Altman

The underlying market momentum is driven by strong corporate profits, a resilient US economy, a boom in business fixed investment (AI, manufacturing, robotics), consumer wealth effect, and high new business formation.

Conditions before potential oil spike are very good, but $150 oil could destabilize markets and the economy.
Would markets go first or would you need to see demand destruction in the economy?

Speaker1
Roger Altman

Markets would go first, before the economy. This could be recessionary in parts of the world or even the US if protracted.

We may see the second big inflation shock of this decade after COVID, from this oil situation.
Roger Altman

Higher yields (10-year over 4.60%, 30-year at 20-year high, Japanese yields up) may move up further, which would be negative for markets.

Markets would move before the economy.
Do you like Kevin Warsh as Fed chair pick? Is it puzzling Trump picked a hawk?

Speaker1
Roger Altman

I like Kevin Warsh, he's a serious guy. Trump made a good choice, not a dove or lackey. He will react to practical realities, not ideology, and maintain Fed independence.

Fed funds futures signal greater likelihood of a rate hike than a cut, but Warsh won't hike immediately. It will be hard to implement rate cuts soon given oil prices and inflation.

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