History suggests oil shocks are buying opportunties: Over the last 40 years, the S&P 500's 12-month return following a 2-day oil spike of +20% has been +24%. In 6 out of 7 instances since 1986, the S&P 500 has been higher 1 year after such an oil spike. The strongest recovery was +54% following the 2020 pandemic crash, driven by a massive stimulus response from central banks and governments. The only negative outcome was -11% during the 2008 Financial Crisis. Put differently, every oil shock over the last 40 years that did not lead to a prolonged recession was followed by a strong rally. Oil shocks are historically brief and provide long-term buying opportunities.(The Kobeissi Letter)