Journal Article

The anatomy of an oil price shock

Abstract: Oil price shocks do not cause inflation, no matter how close the connection seems to be in our practical experience. But they can cause significant price increases throughout the economy. Tracing the way a sharp increase in the price of crude oil affects prices in various industrial sectors of the U.S. economy suggests how big these increases are. Fortunately, our economy seems better prepared now to weather such shocks than in the 1970s and 1980s.

Keywords: Inflation (Finance); Petroleum products - Prices;

Bibliographic Information

Provider: Federal Reserve Bank of Cleveland

Part of Series: Economic Commentary

Publication Date: 2006

Issue: Nov

Order Number: 1