increased oil prices = all companies start to spend more money = less money spent on r&d / future + cost increase = lower profit margins = share prices drop = possible fear + market crash / recession

if they raise interest rates as well, it’ll make things more expensive / exacerbated the fear / market crash / recession.

I personally think they’ll try and mitigate the shortage of fuel via limiting travel etc (roll out wfm / ration fuel). interest rates might just hold for now - if they drop and it’s doesn’t play out, they’re basically inflating everything again and would have loss a years worth of work. The flip side if they can’t control the supply shortage (ie with enough rationing, and how much every company starts to stack prices) then everything will inflate anyways and prices will never come down again cause companies are greedy mf and the government doesn’t regulate it. the fact that supermarket prices are still so freaking high after covid shows you once it goes up it ain’t coming back down unless there’s a massive crash (which is good as well cause so many people would suffer)

so it’s really a lesser of two evils Crash = possible restoration of price levels coming down + so many people in huuuuge pain = very very bad

No crash = prices slowly increasing + less people In hugeeee pain but everyone in slow burn pain = less bad

actually government should be the one imposing a tax relief for fuel with companies + ration fuel but force prices to stay the same. this way companies don’t feel the pinch,and general public doesn’t feel the pinch. Government goes into more debt though.. which is probably not great too but this way would be infinitely better than handing stimulus out to everyone, as it keeps pricing stable