Inflation is measured by industry, and some industries see price movements more than others. For example, retail might see less of a price increase than leisure, and so on. One sector that has been hit hard by the inflation crisis is energy. Energy prices have shot up as a cause of supply and demand, and it’s one of the leading causes of the overall inflation number ticking up.
As a result of this, countries around the world are cooperating with each other to calm this down. The US is working with China, India, South Korea, the UK, and Japan to tap their national petroleum reserves in a move to bring down gas prices, therefore helping cool down inflation. The United States themselves will put 50 million barrels of oil into the global market, and the other countries are expected to make similar contributions. This will be the biggest coordinated oil release in a decade, and the goals are to progress towards clean energy while resolving inflation in the short term. However, the markets weren’t exactly affected as talks were happening for the last month, with crude oil prices slightly rising after the announcement. Analysts believe that this could continue if the decision doesn’t have much of an effect, and demand continues to rise as we leave the pandemic behind. Biden faced criticism from the Republican Party, with members saying that they should focus on domestic oil production instead, but Biden has decided to take global hands instead, and we’ll see if that pays off. Do you think this will have a major impact on prices?
I am not a financial advisor and my comments should never be taken as financial advice. Investments come with risk, so always do your research and analysis beforehand.