On Friday night, U.S. stocks fell across the board. Only one sector was in the green: energy. Brent crude futures for December rose 2.4% to settle at $117.64 a barrel, after briefly touching $118 intraday—their highest level since the end of April. West Texas Intermediate rose 2.08% to settle at $104.12 a barrel. For October as a whole, Brent rose 13.6% and WTI gained 15.2%, marking a fourth consecutive monthly advance. The longer-term move is even more striking: Brent has climbed from $60.85 a barrel at the end of 2025 to $117.64 today, nearly doubling in ten months. The S&P 500 energy sector rose nearly 2% on Friday. Valero Energy gained nearly 4%, Phillips 66 rose more than 3%, and Marathon Oil climbed 2.83%. ConocoPhillips, Apache, Exxon Mobil, and EOG Resources all advanced more than 2%, while Chevron rose 1.75% and Occidental Petroleum gained 1.57%.
What is driving oil prices higher is not demand, but the risk of war. On October 30, Iran’s Islamic Revolutionary Guard Corps Navy announced that a fourth oil tanker had struck a mine in the Strait of Hormuz, exploded, and caught fire. The vessel was carrying more than 2 million barrels of crude. The UK Maritime Trade Operations confirmed that a small boat had placed an explosive device on a tanker. Shipping sources said it was the first known successful limpet mine attack since the conflict began in February. On the same day, Yemen’s Houthi movement claimed to have attacked several oil and gas facilities in Saudi Arabia. The Strait of Hormuz is the world’s most critical chokepoint for oil shipments. With ships running into trouble one after another, the market’s first response is to price in the possibility of supply disruptions. That is what is known as a risk premium: the extra amount built into oil prices is not for oil today, but insurance against future supply outages.
The bigger question is what happens after November 3. On October 27, The Wall Street Journal cited people familiar with the matter as reporting that the United States had notified several Arab Gulf states that it was preparing a “short and forceful” military operation against Iran after the November 3 midterm elections. On October 29, U.S. Central Command chief Brad Cooper briefed President Trump on military options targeting Iran. Trump has yet to make a final decision, and on the 30th he said in an interview that the war with Iran would “end soon.” With preparations for war on one side and talk of a ceasefire on the other, markets can only bet both ways. Diplomacy is also continuing: a Qatari delegation returned to Tehran to mediate, while U.S. Vice President Vance reportedly contacted Iranian officials and proposed launching a new diplomatic process. The bets on prediction markets are even more telling: traders still put the odds of a U.S.-Iran ceasefire holding through November 3 at 83%. In other words, the bet is that there will be no action before the election, and that the real window opens afterward.
At these levels, oil prices are affecting far more than just the energy sector. The first chain reaction points to inflation: oil is a cost underpinning the prices of all goods. When oil gets more expensive, so do transportation, chemicals, and food. As inflation expectations rise, so do expectations of further Federal Reserve rate hikes. The CME FedWatch tool shows traders see about an 86% probability of a 25-basis-point rate hike in December. The second chain reaction points to stocks: the Nasdaq Composite fell 2.86% on Friday. A technology-stock sell-off combined with expectations of persistently high interest rates hit growth-stock valuations hardest, leaving energy stocks as the market’s only refuge. The third chain reaction concerns supply: tomorrow, Sunday, November 1, the seven members of OPEC+ will meet online to set December production targets. November is already the second consecutive month in which output has been held steady, with cuts of about 2 million barrels per day still in effect. As long as the conflict continues, no one will dare to approve an increase in production.
What is really worth thinking about is a line in a Saxo Bank report dated October 29: even if the conflict ends, oil prices could still hover between $70 and $90 a barrel, above the prewar range of $60 to $70. In other words, the market has already shifted its anchor for “normal oil prices” upward by $20. A war can end in a ceasefire, but the pricing baseline reshaped by the war may not return to where it was. Shipping insurance has become more expensive, alternative routes cost more, and oil producers’ discipline around production cuts has weakened. Each has become a new floor for oil prices.
Three signposts to watch next: First, tomorrow’s November 1 OPEC+ meeting. Whether December output remains frozen or the group signals a willingness to loosen restrictions will be the first piece of the supply puzzle. Second, whether the United States actually takes action after the November 3 midterm elections. That will be the dividing line between geopolitical risk remaining a “premium” and turning into an actual “supply disruption.” Third, from a technical perspective, Brent faces resistance at $120 and support at $106. A break above $120 would open the door to another leg higher; a drop below $106 would signal that this round of geopolitical premium is starting to fade. In the short term, oil prices are likely to fluctuate at elevated levels between $106 and $120. The real direction will depend on both the election outcome and the OPEC+ decision.
Ten months ago, nobody thought twice about oil at $60 a barrel. Today, $117 has become the new normal. What is rising in price is not just oil, but the world’s gradual acceptance of the reality that the era of cheap energy is over.
#原油 #U.S.Stocks
What is driving oil prices higher is not demand, but the risk of war. On October 30, Iran’s Islamic Revolutionary Guard Corps Navy announced that a fourth oil tanker had struck a mine in the Strait of Hormuz, exploded, and caught fire. The vessel was carrying more than 2 million barrels of crude. The UK Maritime Trade Operations confirmed that a small boat had placed an explosive device on a tanker. Shipping sources said it was the first known successful limpet mine attack since the conflict began in February. On the same day, Yemen’s Houthi movement claimed to have attacked several oil and gas facilities in Saudi Arabia. The Strait of Hormuz is the world’s most critical chokepoint for oil shipments. With ships running into trouble one after another, the market’s first response is to price in the possibility of supply disruptions. That is what is known as a risk premium: the extra amount built into oil prices is not for oil today, but insurance against future supply outages.
The bigger question is what happens after November 3. On October 27, The Wall Street Journal cited people familiar with the matter as reporting that the United States had notified several Arab Gulf states that it was preparing a “short and forceful” military operation against Iran after the November 3 midterm elections. On October 29, U.S. Central Command chief Brad Cooper briefed President Trump on military options targeting Iran. Trump has yet to make a final decision, and on the 30th he said in an interview that the war with Iran would “end soon.” With preparations for war on one side and talk of a ceasefire on the other, markets can only bet both ways. Diplomacy is also continuing: a Qatari delegation returned to Tehran to mediate, while U.S. Vice President Vance reportedly contacted Iranian officials and proposed launching a new diplomatic process. The bets on prediction markets are even more telling: traders still put the odds of a U.S.-Iran ceasefire holding through November 3 at 83%. In other words, the bet is that there will be no action before the election, and that the real window opens afterward.
At these levels, oil prices are affecting far more than just the energy sector. The first chain reaction points to inflation: oil is a cost underpinning the prices of all goods. When oil gets more expensive, so do transportation, chemicals, and food. As inflation expectations rise, so do expectations of further Federal Reserve rate hikes. The CME FedWatch tool shows traders see about an 86% probability of a 25-basis-point rate hike in December. The second chain reaction points to stocks: the Nasdaq Composite fell 2.86% on Friday. A technology-stock sell-off combined with expectations of persistently high interest rates hit growth-stock valuations hardest, leaving energy stocks as the market’s only refuge. The third chain reaction concerns supply: tomorrow, Sunday, November 1, the seven members of OPEC+ will meet online to set December production targets. November is already the second consecutive month in which output has been held steady, with cuts of about 2 million barrels per day still in effect. As long as the conflict continues, no one will dare to approve an increase in production.
What is really worth thinking about is a line in a Saxo Bank report dated October 29: even if the conflict ends, oil prices could still hover between $70 and $90 a barrel, above the prewar range of $60 to $70. In other words, the market has already shifted its anchor for “normal oil prices” upward by $20. A war can end in a ceasefire, but the pricing baseline reshaped by the war may not return to where it was. Shipping insurance has become more expensive, alternative routes cost more, and oil producers’ discipline around production cuts has weakened. Each has become a new floor for oil prices.
Three signposts to watch next: First, tomorrow’s November 1 OPEC+ meeting. Whether December output remains frozen or the group signals a willingness to loosen restrictions will be the first piece of the supply puzzle. Second, whether the United States actually takes action after the November 3 midterm elections. That will be the dividing line between geopolitical risk remaining a “premium” and turning into an actual “supply disruption.” Third, from a technical perspective, Brent faces resistance at $120 and support at $106. A break above $120 would open the door to another leg higher; a drop below $106 would signal that this round of geopolitical premium is starting to fade. In the short term, oil prices are likely to fluctuate at elevated levels between $106 and $120. The real direction will depend on both the election outcome and the OPEC+ decision.
Ten months ago, nobody thought twice about oil at $60 a barrel. Today, $117 has become the new normal. What is rising in price is not just oil, but the world’s gradual acceptance of the reality that the era of cheap energy is over.
#原油 #U.S.Stocks