We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Two-Week Pause in Iran War: Inverse Energy ETFs for Quick Gains
Read MoreHide Full Article
Key Takeaways
Trump announces a two-week ceasefire, easing geopolitical tensions and calming oil markets.
Oil prices plunge over 16% as fears of supply disruption through Hormuz temporarily fade.
Inverse energy ETFs like NRGD and ERY gain traction as traders bet on short-term downside in energy prices.
President Donald Trump, on April 7, 2026, said he would suspend planned attacks on Iranian infrastructure for two weeks, stepping back from earlier threats of imminent large-scale strikes on Iran’s “whole civilization,” as quoted on CNBC.
The decision came more than a month after the United States and Israel launched the attack on Iran.The decision was “based on conversations with Prime Minister Shehbaz Sharif and Field Marshal Asim Munir, of Pakistan,” Trump wrote, as mentioned in CNBC.
Ceasefire Linked to Strait of Hormuz Opening
Trump said the pause is dependent on Iran agreeing to the “complete, immediate, and safe” reopening of the Strait of Hormuz, a critical route for global oil shipments. “This will be a double-sided ceasefire,” he wrote on Truth Social. Iranian Foreign Minister Abbas Araghchi said vessels would be allowed safe passage through the strait during the two-week period, subject to coordination with Iran’s armed forces and technical considerations.
Negotiations to Begin in Islamabad
Talks between the United States and Iran are set to take place in Islamabad over the next two weeks. Iran’s proposal reportedly includes U.S. troop withdrawals from regional bases, sanctions relief, release of frozen assets, war compensation, and a structured framework for transit through the Strait of Hormuz, as quoted on CNBC.
Slump in Oil Prices
Oil prices dropped on April 7, 2026, after President Trump paused a broad bombing campaign on Iran. Futures on Brent crude plunged more than 16% to trade as low as $90.78 a barrel. Futures on the West Texas Intermediate (WTI) crude also slumped 16% to trade just above $94 on Tuesday night, as quoted on Yahoo Finance.
ETFs to Gain
Against this backdrop, energy-related inverse exchange-traded funds (ETFs) could be tapped for quick gains.
MicroSectors U.S. Big Oil -3 Inverse Leveraged ETN (NRGD - Free Report) – down 28.9% past month; up 9.9% past week
MicroSectors Energy 3X Inverse Leveraged ETN (WTID - Free Report) – down 23.7% past month; up 9.1% past week
Direxion Daily Energy Bear 2X ETF (ERY - Free Report) – down 14.3% past month; up 6.4% past week
Direxion Daily S&P Oil & Gas Exp. & Prod. Bear 2X ETF (DRIP - Free Report) – down 21.4% past month; up 5.5% past week
ProShares UltraShort Energy (DUG - Free Report) – down 14.1% past month; up 5.7% past week
Any Caveat?
These funds run the risk of huge losses compared to traditional funds in fluctuating or seesawing markets. Further, their performance could vary significantly from the actual performance of their underlying index over a longer period when compared to a shorter period (such as weeks or months).
Investors should note that these products are suitable only for short-term traders, as they are rebalanced on a daily basis. Further, liquidity can be a big problem as it can make the products more expensive than they appear.
Moreover, the trajectory of oil prices from here hinges on how much physical damage happens to the energy infrastructure. According to Rystad Energy’s estimates, energy infrastructure repair and restoration costs could be at least $25 billion, based on an initial assessment of impacted facilities. Hence, over the medium term, oil prices are unlikely to return to the pre-war low levels.
Zacks' 7 Best Strong Buy Stocks (New Research Report)
Valued at $99, click below to receive our just-released report
predicting the 7 stocks that will soar highest in the coming month.
View the Zacks #1 Rank List
Image: Bigstock
Two-Week Pause in Iran War: Inverse Energy ETFs for Quick Gains
Key Takeaways
President Donald Trump, on April 7, 2026, said he would suspend planned attacks on Iranian infrastructure for two weeks, stepping back from earlier threats of imminent large-scale strikes on Iran’s “whole civilization,” as quoted on CNBC.
The decision came more than a month after the United States and Israel launched the attack on Iran.The decision was “based on conversations with Prime Minister Shehbaz Sharif and Field Marshal Asim Munir, of Pakistan,” Trump wrote, as mentioned in CNBC.
Ceasefire Linked to Strait of Hormuz Opening
Trump said the pause is dependent on Iran agreeing to the “complete, immediate, and safe” reopening of the Strait of Hormuz, a critical route for global oil shipments. “This will be a double-sided ceasefire,” he wrote on Truth Social. Iranian Foreign Minister Abbas Araghchi said vessels would be allowed safe passage through the strait during the two-week period, subject to coordination with Iran’s armed forces and technical considerations.
Negotiations to Begin in Islamabad
Talks between the United States and Iran are set to take place in Islamabad over the next two weeks. Iran’s proposal reportedly includes U.S. troop withdrawals from regional bases, sanctions relief, release of frozen assets, war compensation, and a structured framework for transit through the Strait of Hormuz, as quoted on CNBC.
Slump in Oil Prices
Oil prices dropped on April 7, 2026, after President Trump paused a broad bombing campaign on Iran. Futures on Brent crude plunged more than 16% to trade as low as $90.78 a barrel. Futures on the West Texas Intermediate (WTI) crude also slumped 16% to trade just above $94 on Tuesday night, as quoted on Yahoo Finance.
ETFs to Gain
Against this backdrop, energy-related inverse exchange-traded funds (ETFs) could be tapped for quick gains.
MicroSectors U.S. Big Oil -3 Inverse Leveraged ETN (NRGD - Free Report) – down 28.9% past month; up 9.9% past week
MicroSectors Energy 3X Inverse Leveraged ETN (WTID - Free Report) – down 23.7% past month; up 9.1% past week
Direxion Daily Energy Bear 2X ETF (ERY - Free Report) – down 14.3% past month; up 6.4% past week
Direxion Daily S&P Oil & Gas Exp. & Prod. Bear 2X ETF (DRIP - Free Report) – down 21.4% past month; up 5.5% past week
ProShares UltraShort Energy (DUG - Free Report) – down 14.1% past month; up 5.7% past week
Any Caveat?
These funds run the risk of huge losses compared to traditional funds in fluctuating or seesawing markets. Further, their performance could vary significantly from the actual performance of their underlying index over a longer period when compared to a shorter period (such as weeks or months).
Investors should note that these products are suitable only for short-term traders, as they are rebalanced on a daily basis. Further, liquidity can be a big problem as it can make the products more expensive than they appear.
Moreover, the trajectory of oil prices from here hinges on how much physical damage happens to the energy infrastructure. According to Rystad Energy’s estimates, energy infrastructure repair and restoration costs could be at least $25 billion, based on an initial assessment of impacted facilities. Hence, over the medium term, oil prices are unlikely to return to the pre-war low levels.