In 1974, then-US Secretary of State Henry Kissinger flew to Riyadh and reached a deal with Saudi Arabia that would change the world order: Saudi Arabia would sell oil and receive only US dollars; and these dollars would then flow back to buy US Treasury bonds.
At that time, Nixon had just severed the link between the dollar and gold, leading to runaway inflation, depleted dollar reserves, a massive outflow of gold, and the collapse of the Bretton Woods system. Many people believed that the golden age of the dollar was over.
But the deal Kissinger struck with Saudi Arabia established what would later be known as the "petrodollar" system. It was this system that allowed the dollar to survive for another half a century after the collapse of the gold standard.
This is why, whenever someone threatens to block oil routes, it's not just an energy issue for the United States, but also a blow to the very foundation of the dollar system. This is also why the Strait of Hormuz, that narrow, throat-like waterway, has been considered a crucial point that the United States must defend for the past fifty years, even at the cost of military force if necessary.
Understanding this historical background will help us better understand the situation today, fifty years from now.
While most people in China were still fast asleep in the early hours of this morning, a violent fluctuation in the global crude oil futures market, lasting less than an hour, had already wiped out hundreds of billions of dollars in market value.
It all started with a social media post.
U.S. Energy Secretary Chris Wright posted on the X platform: "The U.S. Navy has successfully escorted an oil tanker through the Strait of Hormuz to ensure that oil continues to flow to global markets."
Following the tweet, WTI crude oil prices plummeted within minutes, falling as much as 17% and briefly dipping below $80 per barrel. This came just weeks after Brent crude had surged from $70 to $120 due to tensions in the Middle East.
For traders betting on continued oil price increases, this moment was a nightmare.
However, the plot soon took a turn.
Less than an hour later, White House Press Secretary Karoline Leavitt issued an urgent clarification at a press conference: the U.S. Navy was not escorting any oil tankers. Energy Secretary Chris Wright then quietly deleted the post without explanation. Oil prices subsequently rebounded, but failed to return to their initial levels.
A post, from publication to deletion, takes less than sixty minutes. But the traces it leaves in the global financial markets extend far beyond that hour.
Since the escalation of the conflict between the US and Iran in late February, the game surrounding oil has intensified. Especially after Iran announced the blockade of the Strait of Hormuz, this narrow waterway, which carries about one-fifth of the world's crude oil shipments, was suddenly closed, causing a huge shock to the global energy market. As the situation escalated, international oil prices soared from $70 to $120 per barrel within days, plunging the energy market into a state of high tension.
Almost all traders are waiting for the same signal: when will the Strait of Hormuz reopen? Amid this collective anxiety, any slight disturbance could trigger dramatic price fluctuations. The rapid decline triggered by the Energy Secretary's post was a prime example of this sentiment.
So why did oil prices drop 17% in just a few minutes? Because humans can hardly react that quickly, but algorithms can. In today's financial markets, a significant portion of trading volume comes from high-frequency trading algorithms and AI trading systems. They scan the entire internet in real time, including government officials' social media accounts, grabbing keywords and automatically placing orders.
The post contained three keywords: Navy, Escorted, and Hormuz. The algorithm recognized these words and, combined with the contextual semantics, quickly concluded that the logic of the lockdown being lifted, supply restoring, and oil prices rising was weakened.
The program was then sold immediately.
All of this happened in about 0.003 seconds.
The algorithm doesn't call to verify whether the tanker actually crossed the strait; it only recognizes text and prioritizes speed. An unverified post, within this systemic "collective unconsciousness," can instantly translate into the evaporation of hundreds of billions of dollars in market value.
A real oil tanker needs several hours to cross the Strait of Hormuz, requires actual military escort, and bears fuel costs and real risks. A post about "escort" can cause dramatic price fluctuations in this commodity in just 0.003 seconds.
In other words, crude oil, once the king of commodities dominated by supply and demand fundamentals, inventory data, and production agreements, is now, to some extent, not much different from a meme.
During the last US presidential election, Trump and Musk keenly recognized that this was the information age, so one of them created Truth Social and the other bought Twitter.
In today's information age, government officials' social media accounts have become one of the most sensitive sources of information in the market. This also means that power itself has begun to possess certain meme-like attributes: it spreads extremely quickly, carries a high level of emotional intensity, and is extremely easy to misinterpret and amplify.
Traditional policy information dissemination is slow and meticulous. Mechanisms such as White House statements, State Department bulletins, and Department of Defense press releases naturally involve verification, checking, and layers of confirmation. However, when officials release policy-related information directly on X, these steps are skipped.
We can foresee that as we delve deeper into the AI Agent era, the speed of information capture and transactions will increase exponentially, and dramatic rises and falls will occur in milliseconds.
From a broader perspective, this event perhaps illustrates an even larger shift: we are entering an era of "complete memeification of assets." Almost any financial asset can be driven by emotions, narratives, and social media at some point.
Kissinger used oil to prolong the life of the dollar for fifty years. But he probably never imagined that one day oil itself would become a meme.
No asset possesses a truly unbreakable fundamental moat. All moats are essentially built upon some form of consensus. And with the dual acceleration of social media and algorithmic trading, this consensus is more fragile and more dangerous than ever before.
Perhaps in a sense, this is also a victory for memes.
