Bitcoin climbed above $66,000 for the first time in five weeks on Sunday, reaching $66,670, as geopolitical turmoil in the Middle East sent crude oil prices to their highest since early June. Brent crude spiked to $91.58, up 20% this month, after President Donald Trump threatened Iran on Truth Social and Houthi militants announced a maritime embargo against Saudi Arabia.
Oil's 20% rally and the Strait of Hormuz factor
Oil prices have surged this month on a series of escalating events. On July 17, a drone strike killed US service members, prompting Trump's retaliation threat. Iran then reported a cruise missile attack on an Amazon data center in Bahrain. Houthi militants declared a maritime embargo against Saudi Arabia, threatening Red Sea oil exports. The Strait of Hormuz closure is now a factor affecting supply.
Bitcoin ETF inflows hit $227 million on July 20
The same week, spot Bitcoin ETFs saw $227 million in net inflows on July 20, helping push BTC to its highest level since mid-June. The inflows suggest institutional demand remains strong even as macro risks mount.
The historical oil-Bitcoin headwind
Historically, crude oil prices above $90 for an extended period have been bearish for Bitcoin. The logic: higher energy costs squeeze consumer spending and risk appetite, and they often lead to tighter monetary policy. This time, the correlation may be tested if the oil spike is short-lived — but the conflict shows no signs of cooling.
Traders are watching for any further escalation in the Gulf region. A sustained closure of the Strait of Hormuz could push oil even higher, which would likely pressure risk assets including crypto. For now, Bitcoin is riding the ETF wave, but the oil cloud is getting darker.
