The AI narrative hasn’t broken, but the discount rate used to value AI has cracked first. Overnight, WTI broke above $85, and Brent surpassed $91. The U.S. Treasury reported that the 10-year and 30-year bond yields closed at 4.71% and 5.28%, respectively. On the same night, Nasdaq dropped 1.3%, Micron fell about 7%, Nvidia slid around 2.3%, while SanDisk and SK dropped over 10%. This funding chain isn’t complicated: Rising Gulf risks → Oil prices increase → Inflation expectations rise → Long-term interest rates climb → AI and semiconductor future profits are discounted at higher rates → High-valuation, leveraged positions are sold off first So, last night doesn’t necessarily mean the market suddenly stopped believing in AI. It’s more likely that funds temporarily shifted from high-valuation, long-duration assets to energy, defensive sectors, and cash. For investors, I’m only watching two numbers going forward: Can WTI stay above $85? Can the U.S. 10-year yield stay above 4.7%? If both hold, the high volatility in AI stocks isn’t over yet. If oil prices fall and yields drop quickly, then last night was more like a deleveraging event rather than a long-term reversal of the AI trade. Industry trends and stock prices have never been the same thing.