Moody's says a recession will be hard to avoid if oil prices stay elevated for even a few more weeks

The Strait of Hormuz is effectively closed to oil-tanker traffic, a major geopolitical shock that will darken the U.S. economic outlook. That threat persists even though the U.S. now produces roughly as much oil and natural gas as it consumes, implying higher energy prices, supply-chain disruption and downside risk to growth and inflation.

Analysis

The Strait of Hormuz is effectively closed to oil-tanker traffic, a major geopolitical shock that will darken the U.S. economic outlook. That threat persists even though the U.S. now produces roughly as much oil and natural gas as it consumes, implying higher energy prices, supply-chain disruption and downside risk to growth and inflation.