Ethereum has faced sustained selling pressure over the past three months, with rising oil prices emerging as a key macro driver, according to Fundstrat co-founder Tom Lee.
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If one is wondering why Ethereum $ETH has been under selling pressure:– to me, rising oil prices is the biggest headwind
– ETH inverse correlation to oil is the highest ever pic.twitter.com/G5Uw0wbtJP— Thomas (Tom) Lee (not drummer) FundstratDirect.com (@fundstrat) May 18, 2026
Oil surge linked to ETH weakness amid geopolitical tensions
Lee said on X that the recent weakness in ETH is strongly tied to energy markets, noting that the correlation between Ethereum and oil has reached record levels. Since the start of heightened US–Israel–Iran tensions, crude prices have climbed sharply.
Oil has risen about 66%, moving from roughly $65 to above $100 per barrel during the period. The move reflects growing geopolitical risk and tighter global supply expectations.
Oil spike intensifies as Middle East risk escalates
The upward pressure continued this week after comments from US President Donald Trump, who warned Iran that “the clock is ticking” on negotiations over the Strait of Hormuz.
Earlier, Trump and Xi Jinping held high-level talks in Beijing covering trade, energy security, Iran tensions, and regional stability around the Strait of Hormuz. Crypto assets were not part of the discussions, but markets still reacted quickly.
Following the remarks, WTI crude touched around $108 while Brent crude reached $111. The Strait is a key global oil shipping route, and any disruption raises concerns about supply shocks.
Markets reacted quickly to the renewed risk, with energy prices extending gains and adding to broader macro uncertainty.
ETH decline seen as short-term noise, structural drivers still intact
Ethereum has traded mostly sideways during the conflict period but saw a sharper drop in the past week, falling nearly 10% and returning to around $2,100. The asset is now down about 57% from its all-time high.
Lee described the oil-driven pressure as “short-term tactical noise” and suggested that a reversal in crude prices could support a recovery in ETH.
He also pointed to longer-term drivers that remain in place, including tokenization and agentic AI. According to Lee, these structural trends are expected to strengthen Ethereum’s outlook into 2026, even if short-term volatility remains driven by macro shocks.
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