Team Blitz India
INTERNATIONAL rating agency Moody’s has said that the surging oil prices is the biggest threat to US economy. US oil prices are rapidly approaching $90 a barrel. Global oil prices are firting with $ 92 a barrel amid worries about a wider war in the Middle east. And this has lifted gasoline prices to their highest levels in fve months. The risk is oil prices keep climbing, hurting consumer spending and undoing the meaningful progress on infation. That could cause the Federal Reserve to delay interest rate cuts and spook investors on Wall Street.
Not only that, but enormous political consequences could follow if gasoline prices spike above $4 a gallon and stay there. Moody’s published a model earlier this year that showed gas prices are a key variable in the November election, one that could tip the scales in the favour of former President Donald Trump.
US oil prices surged above $87 a barrel late last week for the frst time since late October, leaving them up about 21per cent this year.
As per the agency, consumers are going to get nailed – especially lowerincome households. People look at the price of gas as a litmus test for their own fnancial situation. This oil price rally has been driven in large part by war.
First, drone attacks on oil refneries deep inside Russia helped lift oil prices last month. Now, the focus is on the Middle east and how Iran will respond to the deadly airstrike on its embassy complex in Syria.
The probability of a supply disruption is rising. There is a fear of a retaliatory strike that could lead to a disruption. US experts say the greatest external risk to the US economy is geopolitical tensions in the Middle east because they would boost oil and gasoline prices.
