Oil prices surged following the surprise attack by Hamas on Israel and Israel’s counterstrike over the weekend. After a knee-jerk reaction upon the open of trading around the world, prices have been well behaved and should abate as the shock of the attack, as deadly as it is, abates. It is ... READ MORE >
oil prices
Chart of the Day: Falling oil and gas demand implies inflation relief
Easing demand for oil and gasoline should provide relief in top-line inflation in October and November. Falling wholesale gasoline prices imply a decline of 12% in retail gasoline prices in the coming weeks from its current level of $3.79 to roughly $3.34 per gallon. This is consistent with the ... READ MORE >
Can a price cap on Russian oil work?
The United States is urging its trade partners to adopt a novel proposal that would put a cap on the price of Russian oil during a time of shortcomings in global production. It’s a creative idea, but it carries risks and could result in another surge in oil prices. Middle market firms need to ... READ MORE >
Fuel oil prices reach a tipping point
American households are consuming less gasoline compared to this time last year as fuel costs continue their relentless rise. Now, with the traditional summer driving season underway, these costs have reached a tipping point, forcing many households to reduce their spending on necessities and ... READ MORE >
Chart of the day: The long-term impact of a ban on Russian energy
As the war in Ukraine continues, the sanctions imposed on Russian oil and gas imports are playing a major role in the global energy crunch. But where is this impact being felt the most? Russia, after all, was the world’s largest exporter of natural gas last year and the second-largest exporter of oil ... READ MORE >
Oil prices and price gouging: Deconstructing the price of gas
Rising energy prices have stimulated a fierce debate around inflation and what is behind the surge in gas prices. Are companies taking advantage of a stressful time in the economy and raising prices more than they need to? Accusations of price gouging and corporate greed now permeate the public ... READ MORE >
The illusion of inventory and price controls in the current economy
Systemic disruptions of supply chains over the past two years because of the pandemic and, more recently, the Russian invasion of Ukraine have renewed calls for political authorities to do something about soaring prices. With inflation standing at 8.5% and risks of another oil and energy price ... READ MORE >
Life during wartime: Inflation, price controls and economic conflict
Inflation spikes higher during war and economic conflict. Price dislocation, price controls and self-rationing are facts of life during wartime. Today, with inflation at a 40-year high and a policy rate pinned to the zero boundary, policymakers face significant constraints as they try to find ways ... READ MORE >
Chart of the day: Consumer sentiment slides amid energy shock
Consumer sentiment slid further in March, falling by 3.1 points from February amid spikes in oil and gasoline prices. The University of Michigan sentiment gauge dropped to 59.7, an 11-year low, according to data released Friday. The decline was only slightly lower than our forecast of a 3.2-point ... READ MORE >
Consumer choice, self-rationing and preparing for shortages
The war in Ukraine, the cutoff of Russian exports and the possible removal of roughly 4.3 million barrels of crude from U.S. and European markets are likely to have a harmful impact on household balance sheets. Should the conflict continue, we expect it will result in price increases for everything ... READ MORE >