According to a recent report by Yahoo Finance, military strikes by the United States and Israel on Iran may cause oil prices to rise by $10 to $20 per barrel.
Oil prices tend to rise when there is conflict in the Middle East because the Middle East produces a large percentage of the world’s oil. Investors may be worried that the conflict may cause an interruption in the supply of oil, particularly near the Strait of Hormuz, which is an important waterway that carries most of the world’s oil.
If oil prices rise, gas prices may also rise in the United States. Higher gas prices may cause food prices and other prices to rise because transportation costs may be higher.
It remains to be seen if prices will continue to rise. If the situation calms down, oil prices may stabilize. If the situation gets worse, prices may continue to rise.
https://finance.yahoo.com/news/us-strikes-against-iran-could-see-oil-prices-jump-10-to-20-or-more-with-no-deescalation-143847017.html
Do you think we will see a surge in prices in all sectors or only ones that depend on transportation and oil? And what fiscal or monetary policy do you think could be introduced to combat this inflation?
ReplyDeleteI agree with you. One conflict can affect the whole economy. I alsp agree that if tensions rise near the Strait of Hormuz, oil prices could definitely spike since so much global oil passes through there.
ReplyDeleteI already think that some of the prices are out of control and this conflict in the middle east has me worried that they will continue to rise. I think it's interesting how this possible rise in the price of oil causes a domino effect into gas prices, and then into food prices because of transportation costs. Hopefully everything works itself out and the prices balance.
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