The oil market has shattered, soaring 35% and then dropping 32% in a single day—something I've never seen before.

It all started when the US and Israel attacked Iran, resulting in the Strait of Hormuz being blocked. About 31% of the world's oil passes through this point. This figure shows how severe this crisis is. Goldman Sachs predicts that if the Hormuz Strait remains closed for five weeks, prices could surge past $100-$150 per barrel. Some analysts say this is the biggest energy crisis since the 1970s.

Now, trading oil has become the hottest game. Both WTI and Brent have jumped over 20% in one day. Investors worldwide are watching this market like a lifeboat.

But the problem is, not everyone knows how to trade oil. There are many methods, each with different risks. Let’s take a look.

The first method is CFDs, which are currently the most popular because you don’t need to own the actual oil. You just predict the price direction. Leverage allows controlling large contracts with little capital. The advantage is you can profit from both rising and falling markets. During such high volatility, there are opportunities in both directions. But the downside is, daily volatility of 25-30% might trigger stop-loss orders before the market moves. Good brokers offer low minimum deposits to make it easy for retail traders to participate.

The second method is oil ETFs, which carry lower risk than CFDs because they don’t use leverage. They are easy to buy and sell through regular stock brokers. Suitable for beginners wanting to invest in oil long-term. They have low fees, but profit potential is more limited.

Futures contracts are the most liquid instrument. On March 9, trading volume hit a record 954,254 contracts. Leverage allows controlling large amounts of oil with little capital. You can enter and exit the market quickly. But such high volatility significantly increases risk.

For safer investment options, consider oil stocks. Most stock prices tend to rise with global oil prices, benefiting from high oil prices through dividends and stock appreciation. However, companies operating in the Persian Gulf may be affected by the Hormuz crisis.

Physical oil purchase is almost impossible for retail investors because the minimum purchase is 1,000 barrels. It requires a huge amount of capital and involves complex logistics.

At this point, the most important thing is risk management. Always set stop-loss orders on every trade. Reduce position sizes because of the abnormal high volatility. Keep an eye on US-Iran diplomatic news 24/7. Avoid using maximum leverage during crises; the risk is many times higher than usual.

The oil market is now the most volatile in years. The Strait of Hormuz, which normally exports 13 million barrels per day, is now nearly shut down. Shipping traffic has decreased by 70%. Ships that still run face higher risks and insurance costs.

Iraq has had to cut production by 70% due to lack of export routes. Qatar Energy has halted LNG production. European natural gas prices (TTF) surged over 30% in just a few days. China, India, Japan, and South Korea, which import 70% of their oil from the Persian Gulf, are hit hardest.

Saudi Arabia is trying to increase exports via the East-West Pipeline to Yanbu, but transportation capacity is very limited. The US White House’s stance is a key variable. Presidential statements can cause daily sharp swings in oil prices.

EIA oil inventories increased by 13.4 million barrels—the largest since November 2023. Normally, this would pressure prices down, but the Hormuz crisis has a much more severe impact, so the market ignores this factor.

In summary, the oil market is in its biggest crisis since the 1970s. No matter which trading method you choose, remember that investing involves risks. Study thoroughly beforehand and select a broker regulated by reputable authorities.