Oil price spike has had limited impact on future prices, but once it does, that’s when the broader economy will suffer – Walsh Trading’s Lusk

Walsh Trading’s Sean Lusk says the recent oil spike has not yet translated into materially higher back-month crude pricing, and that’s one reason gold and silver have not attracted meaningful safe-haven bids. Instead, he’s seeing precious metals trade as a pro-cyclical risk asset—tracking equities lower as yields rise—leaving gold “hovering between $5,000 and $5,200” and silver “back in that mid-$80s range,” with rallies being sold. On crude structure, Lusk points to pronounced backwardation: roughly $96/bbl in the front month versus about $82/bbl for September (noting the Sep contract had been nearer $74 a few days earlier). He frames the front-end spike as largely a logistics/flow issue (oil “sitting on the water” and delayed transits) with pricing already locked in, rather than an immediate repricing of longer-dated supply risk. His key timing risk is duration: if the Iran conflict persists beyond mid-April and crude holds at/above ~$90 for “another month or so,” spillovers could broaden into Treasuries (possible selling by oil-importing EM/Asia to fund higher energy bills), higher yields, weaker equities, and then larger knock-on effects for precious metals and the macro backdrop. Near-term, he also flags positioning: “extreme long positions” in gold/silver make the complex vulnerable to de-risking if equities continue to slide and uncertainty rises. Contrary to the typical playbook, Lusk’s read is that the 3-year co-move between equities and metals is now being unwound; unless a true risk-off safe-haven bid emerges, the path of least resistance remains choppy-to-lower with rebounds capped by long liquidation.