2026 Has a Shipping Lane Beat Crypto
The Real Numbers | Home Economics Journal
A barrel of oil cost about fifty-seven dollars one year ago. On Monday morning it cost a hundred and four. That is almost double. If you had put a thousand dollars into oil last May, you would have about eighteen hundred dollars today.
The stock market also went up. The S&P 500, which is the index that tracks the five hundred biggest companies in America, went up twenty-five percent. A thousand dollars in the stock market last May is worth twelve hundred and fifty today.
Bitcoin went the other way. It was worth about ninety-five thousand dollars one year ago. Today it is worth seventy-eight thousand. A thousand dollars in Bitcoin last May is worth about eight hundred and thirty today. You lost money.
So the best place to have put your money last year was oil. Not the stock market. Not Bitcoin. Oil. And the reason oil almost doubled is the same reason you have been paying more at the gas pump. There is a war in the Middle East, and the ships that carry oil have to pass through a narrow waterway called the Strait of Hormuz, and Iran has been firing missiles at those ships. When the ships cannot move, the oil cannot move, and the price goes up.
That is the question we came in with. Not which investment is the most exciting. All three have stories right now. Not which one will win next year, because nobody knows that. The question is what actually made the most money over the past year, and how much of that came from the war and the chaos in Washington. We read six different reports to find out. We read the U.S. Energy Information Administration, which is the government agency that tracks oil. We read research from J.P. Morgan, one of the biggest banks in the country, on what the new tariffs are doing. We read a study from the Center for American Progress that asked what the economy would look like if none of the past year's policies had happened. We read Morningstar and State Street on Bitcoin. And we pulled five years of price data on the stock market and lined it up against oil and Bitcoin. We came in with three questions. What did each of these make you over the past year? What did the war and the chaos do to those numbers? And where should you put new money now?
What We Actually Know
Oil is the easiest one to explain. The price went up almost eighty-four percent in one year. The reason is simple. Six countries in the Middle East, namely Iraq, Saudi Arabia, Kuwait, the United Arab Emirates, Qatar, and Bahrain, together stopped producing about seven and a half million barrels of oil a day in March because of the fighting. By April that number was over nine million. When that much oil stops coming out of the ground, the oil that is left becomes more valuable. The government's energy agency expects gasoline at the pump to peak around four dollars and thirty cents a gallon this year. Diesel will go higher than five eighty. Those are not predictions. Those are what the agency is already planning for.
The stock market is also pretty simple. The S&P 500 closed at seven thousand two hundred seventy-four on May first. A year ago it was at five thousand eight hundred eleven. That is a twenty-five percent gain. The path was bumpy. The market dropped hard in March when the new tariffs were announced. Then it climbed back as the year went on, partly because oil companies and tech companies kept making money even with the tariffs.
Bitcoin is where it gets interesting. Bitcoin hit an all-time high of a hundred and twenty-six thousand dollars in October. By May it had fallen to seventy-eight thousand. That is a thirty-eight percent drop from the peak, and a seventeen percent drop from one year ago. This is the part that surprises people. For the past two years, the people selling Bitcoin have called it digital gold. They said it would protect you when the world gets shaky. The world got plenty shaky last year. We had a war, the most chaotic tariff year since the 1930s, and a fight over who runs the Federal Reserve. Bitcoin was supposed to do well in exactly that kind of year. It did the worst.
What Is Really Going On
Look at the chart above. It shows what happened to all three of these investments over five years, lined up so they all start at the same place. Bitcoin is on top. The stock market is in the middle. Oil is at the bottom. So over five years, Bitcoin actually won by a lot. The stock market was second. Oil was last.
Now look at just the past year. The order flips completely. Oil is on top. The stock market is in the middle. Bitcoin is last. Same three investments. Different answer. It all depends on when you started.
This is the most important thing in the whole article. The story you tell about what to own depends entirely on how far back you look. If you bought five years ago and held on, Bitcoin made you the most money. If you bought last May, oil made you the most. Both stories are true. They just describe different time frames.
So why did the past year go the way it did. The answer is the war and the chaos. A research group called CEPR tracks something called the trade policy uncertainty index. It just counts how often newspapers write about confused trade policy. In April of last year, that number hit the highest level it has ever recorded. That is what happens when the President announces tariffs, then suspends them ninety days later, then changes them again, then the Supreme Court overturns part of them, then he announces new ones under different rules. The average tariff rate the United States charges on imported goods went from two percent at the end of 2024 to almost sixteen percent at the end of 2025. That is the biggest one-year jump in tariffs since the 1930s.
J.P. Morgan's chief economist, Bruce Kasman, said something important about this. He said the real damage from the tariffs is not the tax itself. It is what the chaos does to people's confidence. When businesses do not know what the rules will be next month, they stop hiring and stop investing. When people do not know what things will cost, they stop spending. The International Monetary Fund estimates that about half of all the economic damage from the tariffs comes from this confidence drop, not from the actual cost.
That confidence drop hit Bitcoin the hardest. Morningstar wrote about this in late April. They talked to several Bitcoin researchers who all admitted the same thing. Bitcoin used to move on its own. Now it moves with the stock market. One study reported by Reuters in April said Bitcoin and the S&P 500 are now ninety-six percent in sync. That number ends the digital gold story. If two things move together that closely, they are not different bets. They are the same bet.
The Center for American Progress did something useful. An economist named Ernie Tedeschi ran a computer model that asked a simple question. What if none of the past year's policies had happened? No tariffs, no federal job cuts, no war with Iran. The model said inflation would be about a point lower. Mortgage rates would be sixty basis points, or just over half a percent, lower. Oil prices would be normal. Tedeschi called what actually happened stagflation. That is when growth slows down and prices go up at the same time. He said it is not as bad as the 1970s version of stagflation, but it is the same shape.
What that model tells us is that the eighty-four percent gain in oil was not a normal gain. It was caused by the war. Take the war away and oil does not double. The twenty-five percent gain in the stock market is partly real. Companies did make more money. But it is also partly the same tariff chaos pushing stock prices around. Bitcoin's seventeen percent loss is the cleanest story of all. Bitcoin fell because regular investors needed cash and sold what they could, and the dollar held up better than expected, and the people who bought Bitcoin thinking it was digital gold realized they had bought a tech stock with extra steps.
What the Sources Said Together
State Street is one of the biggest investment companies in the world, and they sell Bitcoin to big institutional buyers. Their research is the most honest take in the bunch because they could oversell it and they do not. They said Bitcoin is becoming less wild than it used to be, but it is still a lot wilder than the stock market. They said Bitcoin makes sense for big companies that want to hold it on their books like they hold gold or foreign currency. They did not say it makes sense as a place to hide when things get scary. That is a different thing.
Morningstar's reporter Valerio Baselli put it more bluntly. He talked to a Bitcoin researcher named André Dragosch who works for a company called Bitwise that, again, sells Bitcoin. Even Dragosch said Bitcoin is not a good hedge against the stock market. He said it is a good hedge against one specific thing, namely long-term Treasury bonds, which most regular people do not own. So if you do not own a lot of long-term Treasury bonds, the digital gold story does not really apply to you.
The government's own energy agency is telling us this oil rally is mostly over. Their forecast says oil will fall back below ninety dollars a barrel by the end of this year and average seventy-six dollars next year. That assumes the war winds down and the ships start moving through the Strait of Hormuz again. If that happens, most of the past year's oil gain is already in the price. The buyer at a hundred and four dollars today is betting the government's own forecast is wrong.
The stock market is the steadiest of the three. Companies kept making money even through the tariff fights and the war. The Supreme Court ruled against part of the tariff structure in February. The administration responded with new tariffs under different rules. The fight is not over. It just changed shape.
What This Means
Here is the honest read. The past year paid the most to oil because of a war and a fight over a shipping lane. The past five years paid the most to Bitcoin because big institutions started buying it. The past year paid the worst to Bitcoin because those same big institutions made it move just like everything else they own. The stock market sat in the middle of both windows, doing its slow, boring job of going up over time.
If you are deciding where to put new money next month, the questions are different from what they were a year ago. Oil at a hundred and four dollars is priced for the war to keep going. The government's own forecast says it ends. So the buyer at this price is betting against the government's forecast. Bitcoin at seventy-eight thousand dollars is priced as if it is just a tech stock. The buyer at this price is betting that it goes back to being its own thing, which is the opposite of what the past year showed. The stock market at seventy-two hundred is priced for companies to keep making more money in a tariff environment that is still changing.
The five-year chart is the best answer to all three questions. Bitcoin first. Stocks second. Oil last. The opposite of the past year's order. That is what holding period means. The same three investments give you completely different answers depending on whether you bought last May or five Mays ago.
What Each Source Did Well
The government's energy agency gave us the clearest look forward. Their forecast is specific and dated. They say oil drops below ninety dollars by the end of the year if the ships start moving again. That might not happen, but at least we know what they are predicting and we can check later if they were right.
J.P. Morgan did the hardest work of the bunch. Their economists put real numbers on what the tariff chaos cost. The most important finding was that half the damage came from confusion, not from the tariff tax itself.
The Center for American Progress gave us the only thing that lets us separate the war and the chaos from a normal year. Their what-if model showed that the past year's wild oil gain was caused by the war. Without the war, oil would have been normal.
Morningstar and State Street together told the same story two different ways. Bitcoin is becoming a thing that big companies hold on their balance sheets. It is not a place for regular people to hide when things get scary. The past year is the strongest evidence we have that those are two different ideas.
The one-year and the five-year numbers are sitting next to each other in the chart above. They tell different stories about the same three investments. That is what the data shows. This is what it actually means.
Sources
This article is part of the Home Economics Journal published by Breadcoins. It does not constitute investment advice.