The reliance of many countries on oil is declining. When oil was inexpensive in the early 1970s, there was no reason not to drive a large gas-based vehicle that consumed a lot of gas (petrol). Oil price plays a significant role in influencing inflation. Higher inflation will result from very big increases in oil costs. Oil is just one of many variables that affect inflation; others include wage growth, confidence, the amount of spare capacity in the economy, and the rate of expansion. Therefore, even a jump in oil prices may not…
Read MoreHere’s How Rising Gas Prices and Inflation Fuel Each Other
