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The price of crude oil is known for its consistent fluctuations, and the trend continued in 2025 as well. After reaching a five-month high in January, oil prices experienced a significant drop in the following months.

Recently, oil prices plummeted to multiyear lows due to escalating fears of a trade war. West Texas Intermediate (CL=F) saw a decrease of over 7%, while Brent (BZ=F) futures fell by more than 6%. These levels had not been seen since 2021.

On Trader Talk by Yahoo Finance, experienced Wall Street trader Kenny Polcari advised investors not to chase oil prices. Polcari emphasized that the typical reaction of investors to oil price movements often leads to losses. He explained that despite oil's volatility, it remains a vital component of various growing market sectors.

Rather than focusing on short-term fluctuations, Polcari suggested that wise investors should monitor broader trends. He highlighted the continuing reliance of major sectors such as AI data centers, global manufacturing, and infrastructure projects on oil.

While acknowledging the rise of renewable energy sources, Polcari and Lou Basenese, the executive VP of market strategy at Prairie Operating Company, emphasized that oil's significance will endure in the energy mix. Basenese emphasized the need to consider long-term investments in oil.

Although renewable energy sources are gaining ground in the US, Basenese argued that a complete transition to 100% renewables is unrealistic, indicating a gradual rebalancing in the energy market.

The US's significant role in oil production, with record levels reaching 13 million barrels daily, offers some control over market supply. However, traders need to navigate a volatile market landscape influenced by factors like tariff programs and global economic concerns, as recently seen with crude oil prices reacting negatively to these issues.