# Oil spikes vs stocks: an event study
Latent Equity · published Oct 19, 2026 · Macro history
Post: https://x.com/Latent_Equity/status/2112271140085497962

Our read: sharp oil spikes have been noise for stocks, not a signal.

Since 1986, WTI crude has jumped 20% or more in 20 trading days 41 times (our calc). In the 39 with a full year of data, the S&P 500's median gain over the next 12 months was +12.0%. Across all trading days since 1986: also +12.0%.

In the past 39 spikes, the index was higher a year later 79.5% of the time. All days: 79.5%.

Change the test and it holds. The 12-month median after a spike (our calc):
- WTI +30% in 60 days: +10.9%
- WTI +25% in 20 days: +14.6%
- Brent +20% in 20 days: +14.0%
vs about +12% for all days.

Where it hurt: the six worst years after a spike (2000, 2001, 2002, 2007, 2008 and 2022; −14.8% to −47.6%) all overlapped a recession or a bear market. Most spikes that were rebounds from crashed oil prices (1986, 2009, 2016, 2020) were followed by strong years: 8 of 10 beat the all-days median (our calc).

Our read: the oil move on its own hasn't told you much about the next year. The economy it lands in has.

Small sample, overlapping regimes, price only. This is history, not a forecast.

What would prove us wrong:
- Future spikes push the 12-month hit rate below 70%, or the median more than 5 points under the all-days rate, with 40+ events.
- A spike outside a recession or bear market is followed by a 12-month loss of 15% or worse.

General research, the same for every reader. Not investment advice.