GM. Today my radar is locked onto two mutually constraining events—the geopolitical risks surrounding oil and the Federal Reserve’s policy path, because their trajectories are becoming deeply intertwined.

Oil: Supply has recovered, but the risk premium hasn’t gone away. Brent crude rose 2.42% this week, settling near $104.72 per barrel; WTI crude stood at $91.85, up 0.81% for the week. Middle Eastern oil flows have recovered to roughly 80% of pre-conflict levels, with crude exports exceeding pre-war levels on 4 days during the final week of September. But the risks have not subsided—crude flows through the Strait of Hormuz have fallen to 74% of pre-war levels, while Houthi attacks on Saudi airports continue. More notably, the Saudi Aramco CEO warned that global oil supply buffer inventories are “scarily low,” and that market risks could intensify further unless the Strait of Hormuz reopens.

Federal Reserve: Holding rates steady is the consensus, but disagreement centers on December. The probability that the Fed will keep rates unchanged through October is 77.3%. But officials’ comments show clear divisions—Kansas City Fed President Schmid said that, given inflation’s renewed rise, the Fed’s available tool is to raise policy rates; Musalem was even more direct, saying further rate hikes may be needed over the next 6 to 9 months, with inflation remaining the most critical issue facing the U.S. economy. Goldman Sachs has also raised its rate-hike expectations, seeing the possibility of two more hikes, including a 25-basis-point hike in December. The market has fully priced in a December rate hike and expects the Fed to tighten cumulatively by roughly 90 basis points over the next 12 months.

The connection between these two events is this: Oil prices staying above $100 will directly push up inflation expectations, thereby strengthening the Fed’s case for continuing to raise rates. Stronger rate-hike expectations will, in turn, suppress economic growth expectations, weighing on crude oil demand. The core contradiction at present is this—if oil prices do not come down, the Fed cannot ease; if the Fed does not ease, risk assets will struggle to achieve sustained valuation expansion.

My strategy: Watch three key points—whether the Fed delivers a rate hike at its December meeting, whether shipping through the Strait of Hormuz deteriorates further, and whether global oil inventories can be effectively replenished before winter. Any change in one of these three variables could trigger cross-market chain reactions.

Which signal did your radar detect first? Oil prices, interest rates, or geopolitical risks? Share your take on the Square. #每周来晒