What if the Strait of Hormuz reopens and oil risk unwinds?
Premium unwind: Hormuz reopening collapses the oil war-premium — Brent -5%, jet/diesel/gasoline and the energy sector lower, VIX -8, Nasdaq bid on the disinflation tailwind. This is the symmetric reversal of the Rising Lion spike (2025), where crude round-tripped fast once transit normalized. Forward angle: because the premium builds and bleeds quickly, the asymmetry favors fading spikes rather than chasing the relief; the durable read-through is lower breakevens and a friendlier real-rate path for long-duration tech, not a sustained energy short.
how we built this number — every step
The class rate is measured from our dated, sourced event library (decade-normalized Poisson — the full table is public at base_rates.json). The variant’s share within its class is the analyst’s editorial call, published so you can audit it. A wider range means thinner precedent. Full recipe: methodology · scored at Reality Check.
The butterfly cascade
How this trigger trickles across markets, left → right — the root shock, its first‑order moves, then the ripple effects. Drag any node; tap a market for its real price history.
Resolution timeline — how this probability is moving
Our model's odds (gold) over time vs the crowd's (Polymarket, blue), from the past toward the 0–6 months horizon. Each dot is a real macro event that nudged the probability — green pushed it up, red pushed it down. Tap a dot for the source. The gold path is an illustrative reconstruction anchored to today's estimate — real dated events, not a live re-estimate history.
What it would mean
If this plays out, it is a risk-on shock. The Strait of Hormuz fully reopens after a US-Iran de-escalation; the oil risk premium unwinds. The trigger decomposes into signed root‑shocks — Oil supply risk ▼ · Geopolitical risk ▼ — which propagate through our causal graph to the markets below.
If it happens — the markets it would move
Biggest moves first. Projected moves are cascade-model priors; hist A–B% = what comparable past events actually did (measured abnormal returns), and model prior · unmeasured marks markets with no analogue backing yet. Tap any market for its price history.
| Market | Class | Projected move | |
|---|---|---|---|
| 1 | Volatility (VIX) VIXon Hyperliquid 📈 chart | Vol | ▼ -7.8% hist -6.68–-1.41% · other way +11.59% (n=8) |
| 2 | Brent crude BRENTon Hyperliquid 📈 chart | Commodity | ▼ -5.4% hist -3.6–-1.26% · other way -6.47% (n=8) |
| 3 | WTI crude CLon Hyperliquid 📈 chart | Commodity | ▼ -4.5% hist -3.25–+0.18% · other way -7.04% (n=8) |
| 4 | Nasdaq 100 NDXon Hyperliquid 📈 chart | Index | ▲ +3.8% hist +1.02–+2.56% · other way -0.55% (n=8) |
| 5 | Energy sector XLEon Hyperliquid 📈 chart | Equity | ▼ -3.1% hist -2.48–-0.74% · other way -2.7% (n=8) |
| 6 | Tech sector XLK 📈 chart | Equity | ▲ +2.9% hist +0.87–+2.26% · other way +0.13% (n=8) |
| 7 | United Airlines UAL 📈 chart | Equity | ▲ +2.7% hist +0.86–+1.74% · other way +13.09% (n=8) |
| 8 | S&P 500 SPXon Hyperliquid 📈 chart | Index | ▲ +2.0% hist +0.15–+2.34% · other way +1.39% (n=12) |
| 9 | ExxonMobil XOM 📈 chart | Equity | ▼ -2.2% hist -1.84–-0.4% · other way +0.08% (n=12) |
| 10 | Chevron CVX 📈 chart | Equity | ▼ -2.0% hist -2.2–-0.21% · other way +0.02% (n=12) |
| 11 | Delta DAL 📈 chart | Equity | ▲ +2.3% hist +0.48–+2.04% · other way +7.19% (n=8) |
| 12 | MicroStrategy MSTRon Hyperliquid 📈 chart | Equity | ▲ +1.9% hist -5.92–+15.86% · other way +14.65% (n=8) |
| 13 | Solana SOLon Hyperliquid 📈 chart | Crypto | ▲ +1.5% hist -1.82–+5.58% · other way +0.57% (n=7) |
| 14 | Semiconductors SMHon Hyperliquid 📈 chart | Equity | ▲ +1.7% hist +0.04–+2.17% · other way +0.42% (n=8) |
Probable recommendation
Why we may diverge from history
Trust the cascade long on ARM/INTC/QCOM: history's -2 to -7% is idiosyncratic noise (2026 Maduro, Alphabet dividend, SPX milestones) with no link to a Hormuz risk-premium unwind — off-channel, discard.
Historical precedent — what analogous events actually did
Across 40 analogous events (overlap‑weighted), as abnormal returns — market beta stripped, so it's the event's own effect, not the market backdrop. Shown at 20 days (persistent) and 5 days (immediate); ↺ fades = the two horizons disagree. Confidence = consistency × sample × significance.
| Asset | History says | Abnormal (20d · 5d) | Hit | n | Confidence | vs cascade |
|---|---|---|---|---|---|---|
| RTX RTX | SHORT | -3.1% · 5d -2.2% | 70% | 40 | 0.39 | ✓ matches cascade |
| SPX SPX | LONG | +1.3% · 5d +0.5% | 70% | 40 | 0.37 | ✓ matches cascade |
| QCOM QCOM | SHORT | -2.4% · 5d -1.4% | 71% | 39 | 0.30 | ⚠ differs |
| LMT LMT | SHORT | -2.3% · 5d -1.8% | 67% | 40 | 0.28 | ✓ matches cascade |
| XOM XOM | SHORT | -0.7% · 5d -1.5% | 63% | 40 | 0.25 | ✓ matches cascade |
| High-yield credit HYG | SHORT | -0.5% · 5d -0.2% | 66% | 39 | 0.23 | ⚠ differs |
| TSM TSM | LONG | +1.6% · 5d -1.2% ↺ fades | 63% | 39 | 0.22 | ✓ matches cascade |
| ARM ARM | SHORT | -1.8% · 5d -8.1% | 62% | 14 | 0.22 | ⚠ differs |
| INTC INTC | SHORT | -0.6% · 5d -0.4% | 63% | 40 | 0.22 | ⚠ differs |
| HOOD HOOD | LONG | +9.9% · 5d +0.2% | 62% | 24 | 0.22 | ✓ matches cascade |
| SMH SMH | LONG | +1.2% · 5d -0.3% ↺ fades | 61% | 39 | 0.19 | ✓ matches cascade |
| Volatility VIX | SHORT | -2.5% · 5d -5.8% | 60% | 40 | 0.17 | ✓ matches cascade |
| CNY CNY | SHORT | -0.4% · 5d -0.2% | 59% | 39 | 0.17 | ⚠ differs |
| MRVL MRVL | LONG | +1.3% · 5d -1.1% ↺ fades | 61% | 39 | 0.16 | ✓ matches cascade |
Why this probability
Hormuz never truly closed, so premium-unwind/normalization is the base case over 6mo. A base‑rate‑anchored prior, continuously scored against what actually happens — not a forecast.