WTFinance Sep 21, 2026 31m 20m saved
With Simon Hunt, founder of Simon Hunt Strategic Services
Simon Hunt expects the S&P 500 to rally into November and December, reach 8,500, and then fall to around 5,000 next year.
Most forecasts that carry a recession also carry cheaper oil. His does not. He expects crude at about $150 by the end of this year and American diesel between $8 and $9 a gallon, because the damage he is describing is to physical infrastructure rather than to demand.
"The good news is that having taken the excesses out of credit markets, the 10-year Treasuries, yields will fall from our forecast 5.3% at the end of this year to 3% or just lower next year."
Hunt has spent more than fifty years in the copper industry, founded Brook Hunt & Associates in 1975 and now publishes on the global economy, China and copper through Simon Hunt Strategic Services. He starts this conversation with a pipeline in Saudi Arabia rather than with the Federal Reserve, and the rest of the forecast follows from it.
The full interview is covered here so you can skip it. 31 minutes of audio, 11 minutes of reading.
Here are the 8 predictions that matter.
Key Takeaways
The S&P 500 at 8,500 by December, then around 5,000 next year, on his forecast
The relief rally comes first; the recession arrives in 2027
Crude at about $150, US diesel at $8 to $9 a gallon and gasoline near $6.50, all by the end of this year
Saudi Arabia is exporting neither crude nor distillates, on his account
The 10-year Treasury yield falls from a forecast 5.3% to 3% or lower, which he calls the good news
The copper market was already in surplus in the first half of this year, against what he says the pundits are claiming
He expects the new Fed chair to sit still now and turn aggressive after the midterms, to burn out credit excesses before reinflating for 2028
About five years to rebuild Gulf oil flows, even if the Strait of Hormuz reopened tomorrow
He fears a second, better-coordinated strike on Iran before the midterms — and says plainly it is a risk, not a forecast
Sell every rally, hold physical gold outside the banking system, plant a kitchen garden, is his closing advice
1. The Pipeline Is Down
Asked what he is seeing in the economy and markets, Hunt did not start with either. He started with the pipeline that runs from the Persian Gulf to the Saudi port of Yanbu, which he said the Houthis have hit in four places, destroying the pump station.
His view is that it does not come back quickly, and may not come back at all, because a pipeline already fractured in four places can be fractured again. What he thinks the campaign is for is economic.
The aim, as he reads it, is a G7 recession
I think the basic the basic reason for all of this is to put pressure on America and the other G7 countries so that they fall into recession. The currencies become destabilized and lo and behold at some point in the near future China will launch its gold back currency.
Simon Hunt
A recession, he added, would mask some of the inflation coming from the collapse in Gulf oil flows and from an El Niño he says is already surfacing. His instruction to investors follows from the volatility rather than the direction.
Trade the short cycles, do not invest long
There will be shortterm spikes and short-term troughs and investors suggested that they should only play the short-term cycles and don't invest for long term.
Simon Hunt
2. Saudi Incompetence
Anthony Fatseas asked whether Hunt was surprised at how easily the Houthis have damaged Saudi infrastructure. He was not, and the reason he gave was about the buyer rather than the attacker.
Money spent on the military has not bought capability
because I think it's really telling you know how much money Saudi Arabia spend on their military and how ineffective it is and how incompetent they are.
Simon Hunt
He cited a retired American colonel who had been chief of staff to Colin Powell and had trained soldiers from around the world, and who said the Saudis are simply not competent. On that basis Hunt expects the Houthis to keep succeeding even if Washington decides to back Riyadh.
3. The Next Escalation
Fatseas asked how the Iran-Gulf conflict resolves. Hunt said it may not, and that with Marco Rubio and JD Vance both advising the president it could run to 2029. Then he gave the scenario he is most worried about, and labelled it carefully.
A second coordinated strike before the midterms, as a risk rather than a call
My fear is that this could happen before the midterm elections. It's not a forecast, it's a risk.
Simon Hunt
He then made three separate arguments about what the Houthi campaign sets off.
The first is social. The tribes that make up the Houthis are the same tribes that live on the Saudi border, intermarried and sharing a language, and Yemen has been described by scholars as the cradle of the Arab world. Hunt said the unreported consequence is excitement running through repressed minorities across the Gulf states, and asked whether that eventually unravels the kingdoms.
The second is financial, and it is the one that reaches portfolios. Saudi Arabia and the UAE have been large investors in the United States, and American capital has gone the other way into both, particularly into Emirati AI and data-center infrastructure. With export income collapsing, he said, those flows stop in both directions.
The third is that the UAE is next. Its own lifeline runs from the Persian Gulf to the port of Fujairah, which was hit by Iranian drones or missiles a couple of months ago with little damage, which Hunt reads as a signal rather than an attempt to destroy. The map of land and sea the Islamic Revolutionary Guard Corps published a few weeks ago puts Fujairah inside the waters it means to control.
The UAE ends up where Saudi Arabia already is
So I think that the UAE's lifeline down to the port of Fujairah at some point in the next ladder of escalation the port will be hit and thus the UAE will be in the same boat as is Saudi Arabia.
Simon Hunt
4. Five Years To Normal
Fatseas said the infrastructure damage is the part that takes years to repair. Hunt agreed, and relayed an assessment from an oil industry figure who rarely speaks publicly and had done so a week or so earlier with Larry Johnson: the reporting has focused on wells rather than on pumping stations and pipelines.
Even a reopened Hormuz would not fix it
And he is actually saying that even if Hormuz was open tomorrow, it would be almost 5 years before oil flows would be able to return to normal because of the way that Iran has struck key points in the oil infrastructure.
Simon Hunt
5. The Year-End Price Calls
That is the supply picture behind the numbers, and Hunt gave them directly.
$150 crude, $8 to $9 diesel, $6.50 gasoline
Yeah, I think by the end of the year crude oil price will be around 150. Diesel prices in America between $8 and $9 a gallon and gasoline prices around $6.50.
Simon Hunt
His reason is the Saudi export position: no crude and no distillates, with the distillates having come mainly from two refineries on the west coast near Yanbu, which have stopped.
6. Warsh After Midterms
Asked how this reaches the global economy, Hunt said America and the other G7 countries are bound to fall into recession next year. On the Fed he flagged his own uncertainty before speaking.
A speculative read on the new chair, not a forecast
I suspect that Kevin Warsh, the new Fed chair, this is a speculative comment from me and not a forecast that he won't raise rates.
Simon Hunt
The meeting was happening that day. What he expects after the midterm elections is aggression: Warsh burning most of the existing excesses out of credit markets so that by the end of next year he can reinflate the system ahead of the 2028 elections.
That is the path behind the equity call.
A rally to 8,500, then 5,000
So, the bad news is that the SNP should fall to around 5,000 next year, having had a relief rally in November, December this year. That could take the S&P up to 8,500.
Simon Hunt
The second piece of bad news is in his own market. A recession means weak physical consumption of base metals, and he said the market is not tight now either.
The copper market is already in surplus
The markets already in the first half of this year globally are in surplus despite what the pundits are saying. Those are the real statistics issued by the International Copper Study Group.
Simon Hunt
And then the part he calls good news.
The 10-year falls from 5.3% to 3% or lower
The good news is that having taken the excesses out of credit markets, the 10-year Treasuries, yields will fall from our forecast 5.3% at the end of this year to 3% or just lower next year.
Simon Hunt
Fatseas put the opposing case to him: the widespread concern about yields blowing out, about government debt, about Scott Bessent's buybacks and about the $5,000 payment to citizens. Hunt read that payment as politics rather than fiscal policy.
The $5,000 is buying votes before a strike, on his reading
Well, that $5,000 per citizen, if the Republicans retain the House and the Senate, I took that a different way. He is trying to buy the votes before he strikes Iran again before the elections.
Simon Hunt
His supporting evidence was a purchase.
A record Israeli order for American bombs
Israel has just recently, according to a report I read, made the biggest purchase of America's 2,000 bombs ever. What's that telling you?
Simon Hunt
7. Ukraine And Brussels
On Russia and Ukraine, Hunt put the initiative with European capitals rather than with Moscow or Washington, saying the leadership in Brussels wants the war to continue so that attention stays away from problems at home. He then named a second fear, again labelling it.
A false-flag operation, named as a fear rather than a call
My fear, and again it's not a forecast, is that Brussels will orchestrate a false flag operation, accusing Russia of something which they did not do.
Simon Hunt
Whether that draws America in, he said, he does not know. His view of how it ends is that the contest between Russia and NATO over Ukraine is settled by fighting, and that this is how Putin is running policy.
On diplomacy, he was dismissive of the current channel: Steve Witkoff and Jared Kushner are not official government appointees, and in his reading of the Kremlin real negotiation starts only between Russia's foreign minister and his counterpart in Washington.
Until then it is a communication system
Until then, it's just talk. It's a communication system and nothing more.
Simon Hunt
8. Gold And A Kitchen Garden
Asked about the split between a Western bloc and an Eastern one, Hunt said Canada is trying to get closer to the European Union at the same time as Brussels, according to policymakers he cites, prepares barriers against Chinese imports. On last week's BRICS meeting he saw nothing new in the communiqué beyond a hope for an Iran-America breakthrough alongside support for Iran, and assumed the substance was in the bilateral meetings nobody has leaked.
He also said power inside Iran has moved away from the president's office and the foreign ministry to a security body headed by a secretary and supported by six generals close to the supreme leader, which is why he reads little into the Iranian president's welcoming speech.
Then came the largest claim in the interview, and he flagged it as opinion.
His personal view: Moscow and Beijing are engineering a collapse
I think that in the background they are engineering a collapse of America's financial system.
Simon Hunt
What follows, on his account, is the currency.
China's gold backing, counted in citizens' holdings first
And that when that happens, at least China will unveil its gold back currency by saying our currency is supported by the gold which our citizens own which in total is about 27,000 tons. let alone what Chinese government including the PLA own which is another 25 odd thousand tons.
Simon Hunt
Asked for one message, he gave three instructions and one reason.
Sell every rally, hold metal outside the banks, fill the freezer
My suggestion is that on every rally in equity markets, liquidate and buy physical gold if you can to be held outside the banking system and to stock up your deep freeze regularly.
Simon Hunt
And if you have a garden, grow food in it
And if you have a garden, convert some of it into a kitchen garden because food prices are going to reach levels we've never seen before.
Simon Hunt
Bonus Insights
Where the timeline starts
Hunt's framing device throughout is that the Middle East decides the rest: shortages and prices of diesel, jet fuel, fertilizers and helium set economic activity, which in turn sets what the Fed does. Every other call in the interview is downstream of that one.
The tit-for-tat
Fatseas' own read, put to Hunt rather than asked as a question, was that attempts to route oil around the Strait of Hormuz keep running into more bombed infrastructure, which is why he expected oil to stay high for longer than the market assumes.
Where to find him
Asked where listeners should go, Hunt gave one answer: simon-hunt.com.
Hunt's bottom line is that the physical damage to Gulf oil infrastructure is large enough and slow enough to repair that it forces a recession on the G7 next year, and that the recession is what eventually brings the 10-year Treasury yield down to 3%, which is why he would sell equity rallies rather than buy them, and hold gold he can reach without a bank.
Products, Companies & Tools Mentioned
Simon Hunt Strategic Services (His firm, which publishes on the global economy, China and the copper industry; the year-end yield forecast of 5.3% is described as "our forecast")
The International Copper Study Group (The source he cites for the copper market being in surplus in the first half of this year, against what he says the consensus claims)
The Federal Reserve (He expects Kevin Warsh to hold now and turn aggressive after the midterms, then reinflate ahead of 2028)
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