What happened

A tweet from President Trump this morning sparked a rally in oil prices -- and oil stocks.

<blockquote class="twitter-tweet"><p lang="en" dir="ltr">Just spoke to my friend MBS (Crown Prince) of Saudi Arabia, who spoke with President Putin of Russia, &amp; I expect &amp; hope that they will be cutting back approximately 10 Million Barrels, and maybe substantially more which, if it happens, will be GREAT for the oil &amp; gas industry!</p>&mdash; Donald J. Trump (@realDonaldTrump) <a href="https://twitter.com/realDonaldTrump/status/1245720677660925952?ref_src=twsrc%5Etfw">April 2, 2020</a></blockquote> <script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>

After initially jumping 10%, oil prices sustained and expanded their gains as the day wore on. As of 12:50 p.m. EDT, West Texas Intermediate crude prices are up 24.4% at $25.20 a barrel, Brent crude is up 22.9% at $30.41 -- and shares of ExxonMobil (NYSE:XOM) and Chevron (NYSE:CVX) are up 8.4% and 10.2%, respectively.  

Stock market arrow rising above a stack of oil barrels

Oil prices march higher, pulling oil stocks along with them. Image source: Getty Images.

So what

Oil-alternative stocks such as SunPower (NASDAQ:SPWR) are coming along for the ride, albeit more hesitantly. Up 9.5% at one point this morning, shares of the solar panel maker and solar power plant builder are still up 3.4% in early-afternoon trading.

But could one single tweet really be responsible for all this?

Apparently so. But it also doesn't hurt that news media are confirming the President's efforts at mediating a truce in the Russia-Saudi Arabia price war, and that China is using the downturn in oil prices to replenish its oil reserves by buying as many as 100 million barrels of oil this year. The prospect of oil prices going higher and remaining high is good news not just for oil giants like Exxon and Chevron. By helping to make their products relatively more price competitive relative to oil, solar stocks can benefit from the news as well.  

Now what

Of course, it's always possible that the President's efforts will come to naught, sending oil prices -- and the prices of oil stocks and renewable energy stocks -- right back down again.

For investors, though, I suspect that longer term we'll find that more significant than the diplomatic goings-on is what's going on in the economy at large -- and specifically, what's happening in the employment market. Today's Department of Labor report that the U.S. has lost 10 million jobs in the last two weeks, combined with similar job losses around the globe, and the fact that millions of Americans, even if they retain their jobs, are now working from home and not commuting to offices, suggests that demand for gasoline is going to plummet.

When you combine lessened demand for gasoline with a probable widespread recession that depresses demand for oil in general, more tough times for oil stocks seem to lie ahead.