Ukraine hit the Slavneft-Yanos oil refinery in Yaroslavl with a long-range drone. Yaroslavl sits hundreds of miles from the Ukrainian border. The refinery is one of Russia's biggest. Someone in Moscow is having a bad morning.
Retail traders saw the headline and immediately checked their portfolios for exposure to Russian energy. They have no exposure to Russian energy. They never did. Russian assets got booted from every major index years ago. But Todd from Austin spent forty minutes on Reddit asking if his Vanguard Total World fund includes Gazprom. It does not. It never will. Todd owns nothing but American tech stocks that were overvalued in 2021 and somehow got more overvalued since.
The attack demonstrates that drone technology has made distance irrelevant in modern warfare. This is technically interesting. It changes nothing about your portfolio. Your portfolio is still garbage. The refinery fire does not make it less garbage. Oil prices might spike for three days. You will buy calls at the top. You will lose money. You always do.
Professional analysts will publish fourteen reports explaining why Brent crude futures are reacting to geopolitical tensions. They will use the word "risk premium" six times per page. None of them will mention that oil prices have spent two years doing absolutely nothing useful for anyone trying to trade them. The correlation broke. The models failed. The experts were wrong. They stayed wrong.
Russia's biggest refinery just took a drone to the face from a country it invaded, proving that military adventures have consequences. Retail traders will somehow interpret this as bullish for their meme stock positions. The refinery burned. Your account burned faster.
Photo by Sonia Dauer on Unsplash
Leave a Comment