Geo Chen
· Fidenza Macro
· May 05, 2026 at 11:05
· ⏱ 5 min read
| Read on Substack ↗
Summary
The Iran conflict is accelerating the shift away from fossil fuels and towards EVs, which the author believes will benefit his holding in the lithium battery ETF LIT. Meanwhile, oil prices have been muted due to greater-than-expected demand destruction, while AI compute demand remains a dominant macro force that overshadows oil market dynamics.
•Brent crude is only up $5 despite renewed US-Iran hostilities in the Strait of Hormuz.
•Demand destruction—from work-from-home mandates in Thailand/Indonesia, driving bans in South Korea, airline cuts, and biodiesel plans—is suppressing oil prices.
•The Iran war is accelerating the shift to EVs and clean energy, ironically driven by Trump's policies.
•The author holds LIT, the Global Lithium and Battery Tech ETF, expecting it to outperform.
•AI build-out capex assumptions are explored in a Goldman Sachs piece, highlighting key variables affecting spending.
•A Warren Pies argument states that demand for compute dwarfs the dynamics in the Strait of Hormuz.
Read time5 min
Length5,354 chars
Categorymacro
Trade Ideas
Geo ChenGlobal macro trader; ex-head of FX trading, Credit Suisse
The war in Iran is accelerating the shift to EVs and clean energy, benefiting lithium and battery technology, and the author believes LIT will outperform as a result.