Higher oil prices will not trouble Fed

Commentators need to shake off the myths of the past, with rising oil prices a boon for US economy

Speculative pressure boosted oil prices in the first quarter of 2024 and will likely do so in the second and third quarters as well. Some analysts assert that the rising prices will cause trouble for the US Federal Reserve. They will not. Today, oil has become relatively unimportant in the US economy. The real pain from high prices will be felt by European countries and the emerging market nations, where higher oil prices wreak economic havoc. Ironically, though, the oil-exporting countries may be the real losers from the speculation-driven price increases in the longer term. Several traders and forecasters see supply and demand balanc