AI exuberance is often cited as a main driver of stocks double-digit percentage gains in 2025, as of early December. But an understated reason for the market's rally may actually be falling oil prices. Lower energy costs can reduce operational expenses across the economy. Since peaking at more than $80 per barrel in mid-January, oil prices have remained relatively low for most of the year (excluding a brief spike in mid-June) and are currently near post-pandemic lows.
Source: FactSet, as of December 1, 2025.