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[Frequent Attacks on Ships in the Strait of Hormuz Continue High Volatility in the Energy Market] ⑴ International crude oil futures prices fell on Tuesday, driven by rumors related to diplomatic negotiations, while the number of attacks on merchant ships in the Strait of Hormuz reached a new high in October. ⑵ Despite the increase in attacks, crude oil exports have not been completely blocked, reflecting a weakening of Iran's leverage in its strategic maneuvering through the strait. ⑶ According to institutional strategists, there were more than 35 attacks on merchant ships in the strait region in October, indicating a significant deterioration in maritime security, with geopolitical risks continuing to support market premiums. ⑷ Currently, physical crude oil circulation through the Strait of Hormuz has recovered to about 80% of pre-conflict levels, with alternative routes such as the Red Sea further supplementing oil export capacity. ⑸ Oil producers and shipowners are mitigating risks by adjusting routes and optimizing logistics plans, temporarily avoiding large-scale supply disruptions, but shipping costs are rising and navigation certainty is decreasing. ⑹ The tight supply of refined oil products coupled with low inventory levels limits market buffer space; once another major disturbance occurs, prices are prone to sharp fluctuations. (7) Qatar-mediated dialogue offers hope for de-escalation, but with the US midterm elections approaching, the geopolitical situation could escalate again, and diplomatic processes could be delayed. (8) The baseline scenario predicts the conflict will continue for a long time but on a manageable scale, and crude oil exports from the Gulf region can remain operational. (9) Under the baseline assumption, as shipping stability improves and geopolitical risk premiums gradually diminish, oil prices are expected to gradually decline. (10) The high frequency of attacks in October means the market's return to normalcy will be slower than previously expected; even if a ceasefire is reached, shipping and inventory repairs cannot be completed immediately. (11) Iranian state media reports indicate that the supreme leadership has granted the government the authority to conduct peace negotiations; if diplomacy makes progress, October may see the peak of attacks on ships. (12) Short-term supply has eased somewhat, but the fragile security environment and tight fundamentals mean the energy market will remain highly volatile.