Friday night, somewhere around dinner, the President posted that the United States had entered “the biggest oil deal in world history.”
Sixty-five billion barrels of Venezuelan reserves. Seventeen oil fields. A hundred-year development right. A 55% stake in the output. And a promise that it would “substantially lower gas prices for all Americans, long into the future.”
I read that and my brain went straight to one number: 5.9.
Because here’s the theory I’ve been carrying around since spring. Oil has been the inflation story of 2026. Not eggs, not rent, not tariffs — oil. The Iran war shut the Strait of Hormuz in March, crude went from $60 to $126 a barrel in ten weeks, and everything downstream of that — gas, diesel, groceries that ride on diesel — followed it up.
So if oil is the disease, more oil should be the cure. Venezuela comes online, crude drops, inflation cools, the Fed relaxes, the 10-year falls, and the 30-year mortgage lands somewhere with a 5 in front of it.
That was the theory. I wanted to be the guy who called it.
So I spent Saturday morning trying to prove it — and I only got halfway there. Which is why Alicia Keys is on the track this morning. I keep on fallin’ in and out of love with this theory.
The half I got right.
Oil really is the whole inflation story right now. Headline CPI is running 3.4%. Core — strip out food and energy — is 2.5%. That gap, almost a full point, is energy. Gasoline is still up 24.6% over last year. The national average at the pump is $4.09 versus $3.21 a year ago.
The Dallas Fed published a paper this summer that put a number on it: the Iran war added somewhere between 0.6 and 1.1 percentage points to inflation this year, depending on how long Hormuz stayed shut.
And here’s the part that matters for your mortgage. The same paper found that oil’s effect on inflation is fast in both directions. A gas price shock hits the headline number on impact and then “quickly returns to zero after two months.” Long-run inflation expectations barely moved. The bond market knows this is a fuel surcharge, not a new normal.
So when the oil premium leaves, it leaves fast. That part of my theory holds.
The half I got wrong.
Venezuela isn’t the thing that makes it leave.
Venezuela produces about 1.25 million barrels a day right now. That’s one percent of the world’s oil. The reserves are enormous — 17% of everything on the planet — but reserves in the ground and barrels on a tanker are two very different things, and the distance between them is measured in years and billions.
JPMorgan’s estimate: production gets to 1.3 or 1.4 million barrels a day within two years. Maybe 2.5 million in a decade. Goldman Sachs ran it further out and found about $4 a barrel of downside to oil prices by 2030 if Venezuela hits 2 million barrels a day.
Four dollars a barrel. By 2030. Roughly a dime a gallon, four years from now.
Same headline. Different timeline. And the timeline is the whole thing.
So what actually gets us to 5.9?
I ran it. The 30-year is at 6.66% this week. The 10-year Treasury is at 4.67%. The gap between them — the spread — is about two full points, and historically it lives closer to 1.7.
To get a 5.9% mortgage at today’s spread, the 10-year has to fall to about 3.9%. Or the spread has to compress and the 10-year has to fall some. Either way, you need oil to keep bleeding out of the inflation number, and you need the Fed to believe it.
And that’s already happening — without Venezuela. Oil keeps on fallin’. Brent peaked at $126 on April 30. It closed Friday at $90.55. Gasoline fell 9.7% in June and another 2.9% in July. The Energy Information Administration’s own forecast has Brent averaging $65 next year and the pump back to $3.09 — and that forecast was written before Friday’s announcement.
So the path to a 5-handle is real. It just runs through Hormuz staying open, not through Caracas. Venezuela is the 2029 story. Iran is the 2027 story.
What this means for the winter.
I’ve been calling November through January bleak. Rates stuck, inventory stacking, buyers on the couch.
Here’s where I’ve landed after doing the work: rates probably don’t save the winter. Fannie Mae just made the steepest one-month upward revision to its forecast all year — they now see 6.8% in Q4 and 6.7% through 2027. In July they had us easing to 6.2%. That’s gone.
But inventory is going to make the winter interesting anyway.
We’re sitting at 4,135 active listings in Louisville this morning. Multifamily just jumped to 174 — it had been parked at 155 for three straight months. I wouldn’t be shocked if that number crosses 200 going into December.
Every one of those is a seller who listed into a rate they didn’t want and a winter they didn’t plan for.
And here’s the math that should get you off the couch: on the median Louisville house, the difference between today’s 6.66% and my dream 5.9% is about $114 a month. Meaningful. But a seller who’s been sitting sixty days will hand you more than that in price before Thanksgiving — and you can refinance the rate in 2027 when the oil premium is gone. You cannot refinance the price.
Negotiate the price now. Refi the rate later. That’s the winter play.
Sometimes this market loves ya. Sometimes it makes you blue.
I still think 5.9% is coming. I was just wrong about who’s bringing it.
📊 Yesterday's poll: "I need to shake up my Mondays and make a big change in my life" ran away with it at 38%. Dead last: "every day is kind of the same to me," at 17%. To the shake-it-up camp — the winter play above is a big change that doesn't require quitting your job.
Where's the 30-year mortgage rate on New Year's Day?
🏆 The Top Five is ready as always — five real deals on the Louisville MLS this morning, five ripe for a lowball, and the number I’d offer on every one. Rules say I can’t blast other agents’ listings to a list. Rules don’t say I can’t send them to you. Reply “FIVE.”
44% of real estate agents are 60 or older
A year ago it was 35%
The experienced agents aren't leaving
The new ones are.
Don’t be a statistic, let’s talk about Winner Realty!
With Enthusiasm,
Rob Bergeron
Owner–Realtor at Award-Winning Winner Realty
Winner Realty | OffMarket.deals | Property Partner Data Company
Schedule time to discuss your goals, bottlenecks, or whatever’s on your mind — book me here.
PS: If you’ve got a big renovation you’ve been dreaming about — or dreading — I want to introduce you to Jake Fabish. Jake’s a Winner agent and the founder of Authentic Carpentry, and he’s spent the last decade building the renovation experience around one question: who are you and what do you actually need? Then the systems and process to make sure that’s what you get. His work has been featured in the last two Tours of Remodeled Homes, so it’s clearly working. If you want clarity and confidence instead of finger-crossing and breath-holding, hit reply and I’ll connect you.
PSS: Germantown. 1914 bungalow, two beds, one bath, 1,200 square feet, chef’s kitchen with quartzite and a big island, a front porch, and a backyard the listing calls an oasis. Just dropped to $225,000. Here’s the part I like: it sits moving to a two-way street where I believe everything around it is zoned commercial, which — if I’m reading it right — opens doors a normal house can’t. New highest and best uses emerge. Something to think about!
PSSS: Multifamily is at 174 this morning, up from 155 where it sat all summer. I wrote a couple weeks ago about why the squeeze has an expiration date — Louisville deliveries go from 4,800 units in 2024 to 1,800 this year while absorption holds around 2,000. Fewer starts now, higher rents next year. Buying a duplex into that at a winter discount is the kind of boring that pays. Current Winner Realty offerings! Every 5+ bedroom single-family home in Louisville under $300,000 — twenty-six of them this morning.
PSSSS: ESPN just did a feature on how Kentucky football could be the next Indiana. What a sentence to write! This would be fantastic for the state and the economy! WE can keep leaning into the tourism bucket!