What if Petrodollar recycling shrinks as oil revenues fall?
A sustained oil glut cuts Gulf export revenues and the petrodollar surplus they recycle into Treasuries and EM assets, tightening global dollar liquidity at the margin and lifting term premia.
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 6–18 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-off shock. A sustained oil glut cuts Gulf export revenues and the petrodollar surplus they recycle into Treasuries and EM assets, tightening global dollar liquidity at the margin and lifting term premia. The trigger decomposes into signed root‑shocks — Credit spreads ▲ · Dollar/reserve confidence ▲ · Oil demand ▼ · Risk appetite ▼ — 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 | MicroStrategy MSTRon Hyperliquid 📈 chart | Equity | ▼ -1.6% hist -1.11–-0.26% · other way +12.56% (n=9) |
| 2 | Bitcoin BTCon Hyperliquid 📈 chart | Crypto | ▼ -0.9% hist -0.47–-0.23% · other way +4.09% (n=5) |
| 3 | Gold XAUon Hyperliquid 📈 chart | Commodity | ▼ -0.8% hist -0.58–+0.59% · other way -1.8% (n=9) |
| 4 | Solana SOLon Hyperliquid 📈 chart | Crypto | ▼ -0.6% hist -0.88–+0.04% · other way +6.04% (n=5) |
| 5 | Coinbase COINon Hyperliquid 📈 chart | Equity | ▼ -0.6% hist -1.94–+1.52% · other way +27.86% (n=5) |
| 6 | Hyperliquid (HYPE) HYPEon Hyperliquid | Crypto | ▼ -0.4% model prior · unmeasured |
| 7 | US dollar (DXY) DXYon Hyperliquid 📈 chart | FX | ▲ +0.4% hist -0.11–+0.91% · other way +1.61% (n=12) |
| 8 | Ether ETHon Hyperliquid 📈 chart | Crypto | ▼ -0.4% hist -1.33–+0.5% · other way +3.12% (n=5) |
| 9 | EUR/USD EURUSDon Hyperliquid 📈 chart | FX | ▼ -0.4% hist -0.88–+0.13% · other way -2.62% (n=8) |
| 10 | 30y Treasury yield DGS30 📈 chart | Rate | ▼ -3bp hist -3.34–-0.25% · other way +24.2% (n=12) |
| 11 | GBP/USD GBPUSDon Hyperliquid 📈 chart | FX | ▼ -0.3% hist -0.67–+0.11% · other way -1.42% (n=8) |
| 12 | 10y Treasury yield DGS10 📈 chart | Rate | ▼ -2bp hist -3.55–+0.1% · other way +26.8% (n=12) |
| 13 | High-yield credit HYG 📈 chart | Rate | ▼ -0.2% hist -0.22–+0.12% · other way -0.45% (n=8) |
| 14 | Turkish lira TRY 📈 chart | FX | ▼ -0.3% hist -0.21–-0.01% · other way +0.49% (n=8) |
Probable recommendation
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 |
|---|---|---|---|---|---|---|
| KRW KRW | SHORT | -0.6% · 5d +0.5% ↺ fades | 67% | 40 | 0.34 | ✓ matches cascade |
| US dollar DXY | LONG | +0.7% · 5d +0.1% | 62% | 40 | 0.21 | ✓ matches cascade |
| USDJPY USDJPY | SHORT | -0.1% · 5d -0.4% | 63% | 40 | 0.21 | ⚠ differs |
| Bitcoin BTC | SHORT | -0.1% · 5d -2.7% | 62% | 23 | 0.20 | ✓ matches cascade |
| SOL SOL | SHORT | -0.5% · 5d -8.5% | 64% | 16 | 0.20 | ✓ matches cascade |
| EURUSD EURUSD | SHORT | -0.6% · 5d -0.1% | 60% | 40 | 0.20 | ✓ matches cascade |
| Gold XAU | LONG | +0.9% · 5d +0.2% | 59% | 40 | 0.18 | ⚠ differs |
| 10y yield DGS10 | SHORT | -2bp · 5d +0bp ↺ fades | 58% | 40 | 0.13 | ✓ matches cascade |
| GBPUSD GBPUSD | SHORT | -0.5% · 5d +0.1% ↺ fades | 57% | 40 | 0.12 | ✓ matches cascade |
| AUD AUD | SHORT | -0.2% · 5d +0.3% ↺ fades | 53% | 40 | 0.06 | ✓ matches cascade |
| TRY TRY | LONG | +0.1% · 5d +1.0% | 52% | 40 | 0.03 | ⚠ differs |
| MSTR MSTR | LONG | +0.4% · 5d -4.4% ↺ fades | 47% | 40 | 0.00 | ⚠ differs |
| COIN COIN | LONG | +2.0% · 5d +0.8% | 42% | 12 | 0.00 | ⚠ differs |
| ETH ETH | SHORT | -1.1% · 5d -3.8% | 45% | 17 | 0.00 | ✓ matches cascade |