As written it can’t be cast because it’s a reaction triggered before the Oracle acts in Encounter Mode.
I think you've missed a part of the rules on this one
Source Core Rulebook pg. 472Your reactions let you respond immediately to what’s happening around you. The GM determines whether you can use reactions before your first turn begins, depending on the situation in which the encounter happens.
Given that the trigger is rolling initiative, it seems pretty clear that this is a time when the GM is meant to enable a pre-turn reaction.
Source Core Rulebook pg. 498In some cases, a trap or a foe has a reaction that tells you to roll initiative. For instance, a complex trap that’s triggered might make an attack with its reaction before the initiative order begins. In these cases, resolve all the results of the reaction before calling for initiative rolls.
|Lyz Liddell Designer|