Last week we asked how long the Saudi East-West pipeline would stay shut. The answer: not long enough to hold the spike. Brent jumped towards $110 after the weekend closure and US crude topped $105 on Tuesday on reports that Saudi Arabia was cancelling some cargoes. On Wednesday the US said the damaged line would restart within days. It restarted at low volumes and began ramping up, while Riyadh moved extra crude to Asian buyers through ship-to-ship transfers just outside Hormuz near Oman's Sohar port.
Crude fell for three straight sessions into Friday. WTI settled at $100.30 (−1.6% on the day), essentially flat on the week, and Brent at $103.87, down about 0.7%. CNBC's summary: Middle East flows proved "surprisingly strong" despite the outage. That matters for how the market handles the next shock. After seven months of war, Gulf producers have built workarounds for each chokepoint, so each disruption has a smaller price effect than the last. The level itself has not come down: WTI is still at $100.
The Saudi pipeline outage took Brent to near $110, then the restart and ship-to-ship workarounds pulled it back to $103.87, with WTI flat at $100.30. Each shock now moves prices less as the Gulf builds workarounds, but the level is still $100.
Both of crypto's risks landed. On Tuesday the Digital Asset Market Clarity Act failed a Senate cloture vote 49–50, short of the 60 needed and not even a simple majority. More than 600 pages of compromise broke down over ethics provisions aimed at officials' crypto business ties. On Wednesday the FOMC voted unanimously to raise rates 25 bp to 3.75–4.00%, the first hike since 2023. Twelve members see another hike this year and four see two. Warsh said: "Inflation is too high and has been for too long." The 10-year yield climbed back to 5%.
Bitcoin fell to about $75,000, then recovered, which surprised many analysts. The hike was fully priced. The SEC and CFTC began building out crypto rules under existing authority, including an SEC innovation exemption for on-chain trading of tokenized stocks. The 10-year slipped back below 5% and Brent dropped under $103, and about $470 million of shorts were liquidated. Crypto.com's daily candle closed Friday at $80,895, up 4.8% on the week. ETH closed at $2,612 (+3.8%), with ETH/BTC near 0.032. The Bank of Japan also hiked, to 1.25%, the same week.
The first Fed hike since 2023 and a failed Clarity Act vote in the same week, and BTC still closed +4.8% at $80,895. The market had priced both, and regulators stepped in where Congress did not. Next test: one more hike is signalled for this year, with the 10-year near 5%.
The JCI took the global tightening on the chin. It fell 1.53% on the week to 6,441.16, including a 0.33% drop on Friday after trading as high as 6,521, as the Bank of Japan's hike added to the Fed's. Foreign investors sold a net Rp1.79 trillion over the week. That is the second straight weekly decline, and the index is now about 3% below the 6,636 high set on September 4.
The rupiah felt the rate differential directly. It weakened for a seventh straight session to 17,758 on Friday, down 0.83% on the week, as higher US rates pulled capital back towards the dollar and fighting between Saudi Arabia and the Houthis kept oil risk high. Last week we said a Fed hike would test the rupiah's rate cushion. It did: BI's 5.75% now sits 175 bp above the top of the Fed's range, down from 200 bp. BI meets on September 22–23, the first meeting under new Governor Destry Damayanti, with the rupiah drifting back towards 18,000.
The JCI −1.53% to 6,441 on Rp1.79T of foreign selling, and the rupiah fell for a seventh straight session to 17,758 as the Fed hike cut BI's rate cushion to 175 bp. This is the rate-differential test we flagged. BI's September 22–23 meeting under Governor Destry decides whether it responds.
MetricBase's chibi penguin mascot and lead analyst — curious, reactive, and unafraid to call a divergence when the data says so. Covers energy markets, digital assets, and Indonesian equities across all three MetricBase verticals.