Written before today's Federal Reserve interest rate meeting - Can raising interest rates lower oil prices? The Federal Reserve's interest rate meeting is scheduled for 2:00 am on Thursday, and the vast majority of colleagues believe that a rate hike is inevitable. Although I am still a minority who think it may not happen, it is not important because I myself am almost losing confidence. But I know that if the Federal Reserve really doesn't do expectation management, then it shouldn't raise interest rates. If it does, it must be expectation management, after all, the core PCE data has not shown an upward trend so far. Although we all know that there is a high probability of an increase next month, that is also next month's thing. My current view is that when the Federal Reserve will raise interest rates at this meeting, but we all know that the main reason for the current rise in monthly inflation rate is the rise in oil prices, and the rise in oil prices is due to Iran's blockade of Hormuz and Trump's incompetence, can the Federal Reserve's interest rate increase make oil prices fall? In the long run, it is indeed possible to demand a price reduction from the supply side by lowering demand. This is not a problem, but it is a long-term situation that may take a considerable amount of time or drag the United States into an economic recession. If the Federal Reserve's decision is more hawkish than market expectations, the US dollar may strengthen and the market may also lower its judgment on future economic and oil demand. The reduction of long positions in crude oil and the increase in financing costs for holding inventory may put pressure on oil prices. At this point, even if the actual consumption of crude oil does not significantly decrease today, futures prices may still fall first. But if the Federal Reserve only raises interest rates by 25 basis points and becomes more cautious about future policies, it may not necessarily bring much additional pressure to oil prices. For example, the price difference of WTI futures we see now is due to market expectations of the market's reaction after the Federal Reserve raises interest rates. More importantly, raising interest rates cannot directly restore transportation to Hormuz, nor can it repair the damaged pipelines in Saudi Arabia. Even if the interest rate hike lowers the price of oil futures, as long as Hormuz is not resolved, crude oil still cannot be shipped out, and supply pressure may push up prices again. So what the Federal Reserve needs to face is that if oil prices continue to rise and inflationary pressures continue to expand, it may need to maintain high interest rates for a longer period of time, or even raise interest rates again. This is also the reason why I still have doubts about this interest rate hike. I agree that interest rate hikes can affect oil prices, and understand that the Federal Reserve needs to prevent inflation from spreading, but interest rate hikes cannot solve Trump's incompetence and the world's laissez faire towards Iran. If this round of conflict cannot be resolved, the cost of high oil prices and high interest rates will ultimately fall on businesses and ordinary households. @Gate Crypto、 US stocks, Hong Kong stocks, South Korean stocks, gold CFD、 Predicting one-stop trading in the market