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The ceasefire lasted twelve days. Peace talks in Pakistan ended Saturday with no agreement, and by Sunday evening a full naval blockade of the Strait of Hormuz was announced, set to begin this morning at 10 AM ET. Oil is back above $100. Futures are pointing lower. And Goldman Sachs drops Q1 results before the bell into the middle of all of it.
What matters:
WTI surged roughly 8% overnight to around $105 per barrel. Brent jumped to around $103. The ceasefire trade that compressed crude from $112 to the low $90s last week is unwinding in a single session. Every Q2 earnings model that assumed oil staying in the $90s needs revision this morning.
Friday’s March CPI landed at 3.3% year over year on a 0.9% monthly increase. Gasoline prices rose 21.2% in March alone, the largest monthly jump since 1967. Core held at 2.6% annually. The seven FOMC participants who projected zero rate cuts in 2026 at the March meeting now look like the reasonable ones.
S&P 500 futures are pointing modestly lower. The index closed Friday at 6,816.89 after posting its best week since November, up 3.6%. The Nasdaq gained 4.7% on the week to close at 22,902.89. That rally priced in a ceasefire that no longer exists.
Goldman Sachs (GS) reports Q1 earnings before the open. The Street expects around $16.50 in EPS on roughly $17 billion in revenue, with both figures reflecting double-digit year-over-year growth. Trading desk activity surged during the first six weeks of the conflict, and the investment banking pipeline has been rebuilding. Goldman has beaten estimates in each of the last four quarters. The question is whether the guidance looks forward into a blockade or backward into a ceasefire.
The 10-year Treasury yield is around 4.35%. Gold is near $4,780 per ounce. Bitcoin is holding around $71,000.
The blockade changes the energy math again.
A naval blockade is structurally different from a disrupted shipping lane. The disruption is no longer passive. It is now actively enforced, which means insurance underwriters have to price sovereign risk on both sides of the strait, not just Iranian interdiction risk. The ceasefire compressed war-risk premiums, sent crude below $95, and gave the market a week to pretend Q2 would look normal. That week is over.
Occidental Petroleum (OXY) has been one of the quieter beneficiaries of elevated domestic crude pricing. Its Permian Basin acreage carries a breakeven below $40 per barrel, and at WTI around $105, the free cash flow math is extreme. The stock trades at roughly 19 times forward earnings with a dividend yield around 1.7%, and Berkshire Hathaway’s significant ownership stake provides an institutional floor that most mid-cap energy names lack.
Schlumberger (SLB), the largest oilfield services company globally, benefits from the second-order effect. When producers accelerate domestic drilling to offset Gulf disruption, SLB’s rig count and completion revenue climb. The stock trades at around 18 times forward earnings, and its order backlog expanded through the first quarter. If the blockade persists into summer, every U.S. producer with available acreage will be competing for SLB’s services and equipment.
Valero Energy (VLO) sits on the refining side with zero Middle East processing exposure. Its inputs are priced off WTI, its outputs are priced off domestic crack spreads, and the blockade widens both. VLO trades at roughly 13 times forward earnings with a dividend yield around 2.4%. The refining margin environment at $100-plus oil with constrained global supply is exactly the operating backdrop Valero’s domestic-only footprint was built for.
Bank earnings set the credit tone for Q2.
Goldman this morning. JPMorgan Chase (JPM), Wells Fargo, and Citigroup (C) all report Tuesday. Bank of America and Morgan Stanley follow later in the week.
The market wants two things from this group: net interest income trajectory and credit provision trends. If loan loss reserves are climbing, it tells you the banks see consumer and commercial stress building. If trading revenue is elevated, it confirms that volatility is generating fee income even as the broader economy absorbs the energy shock.
JPMorgan’s Q1 consensus sits around $5.40 to $5.50 in EPS on roughly $48.5 billion in revenue. The more important number is what the prepared remarks say about the economic outlook. Those remarks have been the market’s most-watched macro forecast for three consecutive quarters, and this one lands into a blockade environment that did not exist when Q1 ended.
The week’s setup.
Goldman before the bell. The blockade at 10 AM. Six more bank earnings over the next three days. And a CPI print already in the rearview confirming that inflation re-accelerated before the blockade even started. The market spent last week buying peace. This week it prices the alternative.
