That’s because the correlation between crude oil and stocks has not been stable over time. For several decades prior to 2000, for example, that correlation was negative, as you can see in the chart below. During those decades, higher oil prices in a given month led to below-average stock-market returns in the subsequent month.

The U.S. dollar fell on Tuesday after President Donald Trump announced a ceasefire between Israel and Iran, in news that sparked a risk rally and a sharp drop in oil prices.