Beyond Borders

Oil, Currencies and the Circus of Economic Narratives

“People think oil prices rise because of bombs. They fall too — even in the middle of wars. It’s a cycle, not a morality tale.”

The Oil Illusion: Geopolitics ≠ Price Driver

Let’s begin with oil.

Contrary to popular belief, oil isn’t a vessel for geopolitics. It’s a cyclical commodity. Full stop.

Yes, missiles might spike Brent. Yes, Gulf tension gets you a few headlines. But over any real timeframe, geopolitical crises are just narrative overlays on what is ultimately a supply/demand cycle.

Jim Rogers — that eternal punchline — got one thing right: oil is cyclical. Whether it’s shale in the U.S., rising OPEC quotas or Chinese demand softening, the long-term arc of oil prices reverts to economics, not drama.

Right now? We’re in a downtrend.

OPEC is already cheating on quotas. U.S. shale drillers are itching for capital. Over the next 2–3 years, oil grinds down to the $30s. Not in a straight line, of course — narratives will come and go — but gravity always wins in oversupply.

This isn’t bearishness. It’s dispassionate realism.

Currencies & Rates: Cash-and-Carry’s Comeback

Next, the dollar.

The DXY is losing altitude. The move is gentle for now, but the mid-zone has a vacuum effect — once dislocation begins, narratives will conveniently follow: maybe it’s rate differentials, maybe it’s the fiscal deficit. Doesn’t matter.

What matters is arbitrage.

This is the perfect setup for cash and carry:

Borrow in USD at SOFR + 100bps
Deploy into INR-denominated mid-cap exposure
Pocket the differential — at least while the party lasts.

This is not risk-free. Not even close. But risk-aware carry is one of the most rational ways to ride the current global arbitrage.

But beware:
When volume dries up in Indian mid-caps and risk reversals reprice, that sweet carry turns into negative bleed real fast. Don’t be the last one standing when risk appetite turns.

Conclusion: Cynicism is a Hedge, but Positioning is a Must

The macro environment is messy. Oil narratives are fake. Dollar stories are late. Central banks are pretending to be in control.

But underneath all the noise, one thing remains: the opportunity to arbitrage the disconnect between what’s true and what’s priced in.

This memo isn’t a call to sit out — it’s a reminder that the circus is part of the system. Learn its tricks. Time your exits. And for god’s sake, don’t get high on your own narrative.