As of: February 20, 2026 by Florian Grummes
While the gold price has been hovering around the round, psychologically important mark of 5,000 US dollars for about four weeks now, undergoing a healthy consolidation phase, the long-neglected oil market is increasingly moving into the focus of financial markets after an 18-year bear market.
The share prices of major US oil companies like ExxonMobil and Chevron, as well as European companies such as Total Energies and OMV, have already risen significantly since the turn of the year. Now, the oil price itself has broken out upwards from its four-year chart technical wedge formation.
In addition to years of underinvestment in exploration and production capacities and an extremely pessimistic sentiment, geopolitical factors play a particularly important role for the oil price. The Trump administration has recognized that energy imports in US dollars represent the Achilles’ heel of the Chinese economy. Against this backdrop, developments in Venezuela and currently in Iran must be viewed.
Oil Prices Jump Due to Iran-USA Tensions
Global Uncertainty Index as of February 18, 2026. ©Ahir, Bicon, Furceri via FRED
In the past two days, oil prices have risen by more than 7% to over 71 US dollars per barrel, reaching their highest level since July of last year. The price increase reflects the growing nervousness in the markets caused by the escalating tensions between the United States and Iran.
The “Global Uncertainty Index” has risen to a historic high, far exceeding the uncertainties associated with Covid-19, the 2008 global financial crisis, and the dot-com bubble in 2000.
At the center of recent developments is “officially” the tense situation surrounding the Iranian nuclear program. US President Donald Trump stated that Iran had only 10 to 15 days left to agree to a deal – otherwise, “really bad consequences” would follow.
At the same time, Washington has expanded its military presence to the highest level since the 2003 Iraq invasion. A round-the-clock airlift is deploying tanker aircraft, air defense systems, and fighter jets to the region – a clear signal to Tehran that the US is determined to do whatever it takes.
Share of Crude Oil Exports via the Strait of Hormuz. ©Energize
Iran immediately responded with a mix of defiance and warning. While the Revolutionary Guards (IRGC) conducted exercises with armed drones, shipping traffic through parts of the Strait of Hormuz – one of the world’s most strategically important oil trade routes – was restricted for several hours.
This passage is crucial for about 20% of global crude oil shipments, particularly for exports from Saudi Arabia, the United Arab Emirates, Kuwait, Iraq, and Qatar. Even a brief incident was enough to immediately drive oil prices higher.
Although it was only a military exercise by the Iranians, the event underscored the vulnerability of the global energy supply. Financial and energy markets react not only to physical outages but already to their possibility. Transport insurance, freight rates, and forward curves therefore immediately reflect the growing uncertainty. This “psychological component” of the oil market acts as an early warning system – prices rise long before the flow of oil is actually interrupted.
Growing Unrest Within Iran
While the US increases its military pressure, unrest is also growing within Iran itself. Mass protests against the Mullah regime demand an end to the Islamic Republic and more freedom. Western analysts see this as a possible internal risk to the country’s stability, but also as an element that tempts Tehran to display foreign policy power – to show strength internally and maintain control.
China and Russia as Technological Protectors
In this situation, Russia urges restraint but simultaneously conducts joint maneuvers with Iran. This geopolitical signal further exacerbates the already complex situation. In addition, Russia and China are significantly involved in strengthening Iran’s air defense. Moscow has equipped Tehran over the years with modern long-range air defense systems to improve air defense against possible Israeli attacks.
At the same time, Chinese technologies shape the lower and middle defense layers, as Beijing supplies radar systems, supports the establishment of a multi-layered air defense network, and urges Tehran to switch from GPS to the BeiDou satellite navigation system.
Through a combination of training, naval exercises, and covert technology transfers, a significantly denser and integrated air defense and surveillance network has emerged than sanctions would suggest – even if Russia and China, despite this support, have so far shied away from clear security guarantees in an emergency.
However, if Iran were to be weakened or even fall, this could plunge both Russia and China into an existential crisis. But for now, it remains uncertain whether Russia and/or China would actually intervene militarily in an escalating war.
The Covert Force of Iranian Cyber and Missile Attacks
While Western media remains silent about the consequences of the twelve-day war last June, Iranian missile and cyber attacks are believed to have damaged around six percent of Israel’s infrastructure at that time. In the event of a comprehensive military conflict, Iran could cause far greater damage.
Diplomatically, the room for maneuver remains narrow: while Washington insists on a complete dismantling of the Iranian nuclear program, a regional conflagration threatens if dialogue fails.
The result: an oil market that is increasingly politicized and driven by uncertainty – with potentially global economic consequences.
Oil – Far Too Cheap Compared to Gold
Gold/Oil Ratio in US Dollars, Weekly Chart as of February 20, 2026. ©GOLD.DE
Looking at the gold/oil ratio, one would currently have to pay around 83 barrels of oil for one ounce of gold. This is extremely high in historical comparison, making gold appear significantly overvalued compared to oil.
From a chart technical perspective, a large cup-and-handle formation is emerging in the ratio. Overall, this would be a bullish continuation pattern in favor of the gold price. Nevertheless, oil could initially significantly outperform gold in the coming months or one to three years, without gold having to fall sharply.
Even if the oil price rises to, for example, 120 US dollars and the ratio falls to 60, the gold price could rise to 7,200 US dollars. These are, of course, only theoretical calculations, but this scenario would be unfavorable for mining stocks, as rising energy costs would reduce the currently high margins.
Oil in US Dollars, Daily Chart as of February 20, 2026. ©GOLD.DE
The oil price itself has been in a long-term downtrend since its peak of around 150 US dollars in summer 2008, which began with the demand collapse during the global financial crisis. After a brutal price drop of -77% within seven months, there was a multi-year, tough recovery until summer 2014.
The subsequent US fracking boom not only led to America’s energy independence but also caused the OPEC cartel to lose price control over the oil market. The US became the world’s largest oil producer. In the following years, the downtrend in oil prices intensified until another demand collapse – this time caused by global lockdowns – even caused the oil price to temporarily fall into negative territory in March 2020.
The sharp reaction that followed temporarily pushed the oil price up to 130 US dollars. This recovery was finally corrected and consolidated in a falling wedge since February 2022.
Now, the oil price is preparing to break out upwards from this falling wedge. A first price target is 90 US dollars. Within the overarching downtrend channel, another realistic price target in the range of 120 US dollars can also be constructed based on the depth of the wedge.
Conclusion: Oil – Breakout with Significant Potential
While gold consolidates around the 5,000 USD mark, the oil price has broken out of a 4-year falling wedge. Geopolitical tensions, in particular, have driven the oil price above 71 US dollars per barrel. Years of underinvestment and the fact that the oil market has moved to the center of the East/West conflict reinforce this momentum.
Our first price target is approximately 90 US dollars. Beyond that, approximately 120 US dollars are also achievable. .
This likely means a longer phase of consolidation and self-discovery for precious metals. Long-term, the cup-and-handle formation in the gold/oil ratio points to a significantly higher gold price, but in the short term, we would not be surprised by a shift in favor towards energy markets.
For investors, this means: energy stocks and oil ETFs are gaining attractiveness, while mining stocks suffer from higher energy costs. In a world of politicized oil markets and simultaneously highly overbought precious metal prices, the energy sector offers the asymmetrically better risk/reward profile.
