Market Greed Is Back: Oil and the Hormuz Strait Didn’t Get the Memo. Gerelyn Terzo May 4, 2026 4 min read ^VIX CL=F ^GSPC SPY PLTR Quick Read The CBOE Volatility Index (VIX) rose 2.2% to above 17 on renewed Middle East tensions and crude prices spiking above $100 per barrel. Middle East conflict escalation and OPEC production cuts have tightened oil supply at a critical chokepoint, introducing risk premium back into options markets despite strong stock market gains.
The Fear and Greed Index hovers at 66, an indication that market greed has returned. The analyst who called NVIDIA in 2010 just named his top 10 stocks and SPDR S&P 500 ETF wasn't one of them. The CBOE Volatility Index (CBOE:VIX) is up 2.2% today to hover just above 17, snapping back from Friday's close as renewed Middle East tensions and crude price spikes reintroduce risk premium into options markets.
The bounce comes one trading session after the S&P 500 set a fresh all-time high of 7,230, capping the index's best month since November 2020. Since April 23rd, the CBOE Volatility Index (VIX) has oscillated between 17 and 21 as investors weigh a busy earnings slate, surging AI capital expenditure, oil prices, and a protracted geopolitical standoff. Against that backdrop, CNN's Fear/Greed Index sits at 66, firmly in greed territory, a reading that is harder to square with each passing Hormuz headline.
Why the Fear Gauge Woke Up The analyst who called NVIDIA in 2010 just named his top 10 stocks and SPDR S&P 500 ETF wasn't one of them. The catalyst is energy and geopolitics. WTI crude sits above $100 a barrel following a 10% weekly surge, placing prices in the top 4% of their 12-month range.
Brent is trading above $110, with the conflict near the Strait of Hormuz now entering its third month and fresh reports of a U.S. warship incident adding to the tension. Strategist Mark Malek cautioned that markets have yet to fully account for the long-term risks posed by sustained elevated oil. Structural pressure is compounding the headline risk.
Barron's reports that the UAE's exit from OPEC has trimmed the cartel's share of global production to 29%, with at least 12 million barrels per day effectively shut in as Hormuz traffic stalls. Spare capacity is the buffer that absorbs supply shocks, with less of it available, even modest geopolitical noise translates into a higher floor on implied volatility, which is why the VIX is responding even as equities remain relatively calm. Calm Market, Nervous Options Pit The headline VIX print masks how orderly the underlying equity market remains.
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