Bitunix analyst: Oil prices breaking above $100 is just a surface phenomenon; what the market is truly trading is the risk of “high inflation being institutionalized.”

Mars Finance news: On July 24, what global markets are facing is no longer just the escalation of Middle East hostilities. Instead, changes are happening at the same time in energy supply, monetary policy, and global capital flows. The U.S. continues to increase military pressure on Iran, including the deployment of B-1 bombers, Trump’s consideration of a larger-scale military action, and the Houthis re-threatening Red Sea shipping. This puts both the Strait of Hormuz and the Red Sea—two major energy transportation arteries—at risk simultaneously. After Brent crude broke above $100, the market has already begun to reprice global inflation risk, rather than simply reflecting a one-off geopolitical event.

What is truly worth noting is that the rise in oil prices has begun to change central banks’ policy reaction functions in countries around the world. In the U.S., initial jobless claims fell back below expectations again, indicating that the labor market remains resilient—meaning there is no urgent need for the Federal Reserve to ease policy. On the other hand, energy prices are pushing inflation expectations higher again, which is lifting U.S. Treasury yields across the board. Market bets on a rate hike in September—even earlier—are increasing rapidly. After the Fed canceled forward guidance, markets no longer wait for the Federal Reserve to provide answers; instead, they independently price the policy path in advance. This has significantly amplified interest-rate volatility and also means that high funding costs may last longer than the market originally expected.

This pressure is not present only in the United States. While the European Central Bank is on hold, it has already made room for a rate hike in September. In Japan’s case, the U.S. Treasury directly called out that the Japanese yen is severely undervalued and urged the Bank of Japan to continue pushing monetary normalization. With Japan’s inflation rebounding and yields rising, the market is reassessing the likelihood of Japan raising rates and large institutions’ capital flowing back to the domestic market. Once Japanese funds begin reducing overseas allocations, it may not only weaken funding demand for U.S. Treasuries and U.S. stocks, but also further tighten global dollar liquidity.

In addition, the U.S. is simultaneously expanding tariff measures, rebuilding an import tariff framework of 10% to 12.5% for about 60 economies. This means that both energy costs and trade costs rise at the same time. This indicates that what markets will face in the future is not only fluctuations in crude oil prices, but also the way supply-chain costs, tariffs, and energy prices collectively push up enterprise operating costs—making it easier for global inflation to form a second-round transmission, and further increasing the necessity for central banks in each country to maintain high interest-rate policies.

For the crypto market, the biggest pressure source right now is no longer simply geopolitics, but rather the synchronized tightening of global real interest rates and dollar liquidity. Rising oil prices lift inflation expectations; yields hit new highs; major central banks are once again discussing rate hikes; and Japanese funds may flow back to the domestic market. Together, these imply that risk assets will face tougher tests from higher funding costs. In the short term, market volatility will still be driven by the Middle East situation and central bank policies across countries. However, the key factor that will truly determine the direction of subsequent asset prices is whether energy prices can continue to stay at high levels, and whether high interest rates gradually evolve into the new normal for global financial markets.