VDE is trading 5.3% down today as crude oil prices collapsed 15% to $95.67 following news of a US-Iran ceasefire agreement.
- The reopening of the Strait of Hormuz has eliminated supply disruption fears that previously drove energy prices to multi-year highs.
- This represents a sharp reversal from Tuesday's peak, when Brent crude exceeded $113/barrel amid escalating geopolitical tensions.
- With the immediate geopolitical risk removed, investors are rotating out of the energy sector and into risk-on assets like equities and cryptocurrencies.