THE QUARTERLY PERSPECTIVE

Elevated Oil Prices Validate the Changing U.S. Energy Landscape

U.S. Economy Weathers Oil Price Spike From Iran Conflict

In March, the escalation of tensions with Iran in the Middle East may have stirred memories of past energy crises marked by gasoline shortages and soaring inflation. After all, some investors still remember the long lines at fueling stations while budgeting and planning around the sky-high cost of gasoline. However, this latest episode has been anything but a repeat of the OPEC-embargoes of the 1970’s. Surprising to some, the economy has avoided buckling as consumers have continued to demonstrate resilience. In fact, both job growth and manufacturing are showing signs of strengthening. Major stock indexes, while down through March, are all higher than when the conflict first began

How has this been possible? The answer lies in the dramatic transformation of the U.S. energy landscape over the past several decades.

The latest stress from higher fuel prices was, of course, felt by consumers. But in no way was it proportional to earlier times. Consider the following three massive changes that have enabled the economy to endure the latest oil-supply disruption.continue reading here.

About The Quarterly Perspective
The Quarterly Perspective is a periodic update addressing some of the biggest issues in the economy and markets. We provide key insights about fundamentals and where we stand in the U.S. business cycle.