Oil prices going up = another round of inflation.

 CRUDE OIL SHORTAGES BEGINNING NOW

THE PRICE OF EVERYTHING WILL INCREASE

OPEC+ has announced another round of production cuts that are expected to take effect by October 1, this will result in $100 a barrel oil price, which will translate into higher prices for everything. Everything is affected by the price of energy, of course, gas, heating oil and all energy is the first, but it also raises the cost of transportation for everything we use. Food production is very energy dependent, diesel fuel for equipment and fertilizer manufactured from oil products will trigger another round of increases in the cost of production and transportation of food.

Eventually it may also affect the price of electricity production, which is still produced by lots of fossil fuel.  

The only way to offset these increases is for an increase in  production of gas and oil by domestic producers, it is very unlikely that will happen. 

The strategic oil reserve is now reported to be at the lowest level since the 1980's, it has been systematically depleted to keep oil prices down but it soon will not be realistic to deplete it further.

High energy prices in Europe have already seen an increase in coal production and an increasing dependence on the use of firewood. We can expect these trends will be the cause of political and environmental anxiety.

While many will blame OPEC, their reasoning is that the buying power of the dollar, still the major payment option for oil sales is declining, due to fiscal policy in the U.S. The high deficit spending practices have a direct impact on this declining value.

There is a trend to trade oil in other currencies, but that will not help the cost of energy in the U.S. as the buying power of the dollar declines the cost of everything denominated in dollars will rise.

The only long range solution is increased domestic production, coupled with a more responsible fiscal policy by the federal government, both seem to be a low priority at this time.