Something’s different about America since the early 2000s and it has to do with drill, baby, drill

Oil is a global market, so when prices rise in one place, they rise everywhere. The current war against Iran has already raised oil prices significantly.

Mideast oil production has been slowed by efforts to close the Strait of Hormuz, a key route for oil tankers from the Middle East to the rest of the world, as well as by attacks – and fears of attacks – on oil production, storage and shipment installations.

And this war has also disrupted the flow of liquefied natural gas from Qatar, which controls almost 20% of the global market. That also affects the world economy and supply chains. And shortages of natural gas affect production of fertilizer and aluminium, as well as other key materials.

As a professor who has been studying oil price shocks for two decades, I’m often asked about the effects of rising oil prices on the U.S. economy. The answer to t...