In recent weeks, you may have been surprised to see your total at the gas station. You’re not alone in your concern, as prices are rising nationwide. The US, Israel, and Iran have been experiencing tension and conflict, and times like these can rise oil prices globally. Since oil is such a heavily relied on resource in the US, the increase of oil prices can affect both everyday expenses and the stock market. Recently, our Director of Investments, Charles “Chad” NeSmith, was featured on CBS News Miami, sharing his insight on these uncertain times, and how investors can approach changes in their portfolio.
Why Do Global Conflicts Make Gas Prices Go Up?
Oil is one of the most important resources to the United States. We use it to make gasoline and participate in the trade of oil all over the world. When a major conflict happens in areas that are crucial to oil production, the supply may become uncertain. Because we may have limited access and are unsure about the future of the resource, prices among all products, especially gasoline, can rise.
Why Does the Stock Market Sometimes Drop When Oil Prices Rise?
Many businesses rely on fuel to operate, and when fuel becomes expensive, operating costs must increase. Investors like to look ahead, and they may become concerned about the potential of prices continuously increasing. This can cause the stock market to fluctuate and dip. “Pay attention to your portfolio. Stick to your goals. Have a plan because these things are completely unpredictable,” Chad shares.
Market ups and downs happen regularly, especially during global events. Headlines can be fearmongering or urge investors to make quick decisions, but it can be beneficial to tune out the noise. Having a long-term plan and staying focused on your long-term goals can help you avoid making rushed decisions and keep your portfolio steady throughout the year.
Final Thoughts
Global events can definitely affect oil prices and the market, affecting everything from daily expenses to investments and even retirement plans. While these changes can feel sudden or alarming, they are a normal part of economic cycles. Staying informed and sticking to your financial plan amidst the headlines can help you stay focused and navigate uncertainty.
If you would like to learn more or chat about your specific situation, we invite you to contact us. We’re here to guide you through the noise and help you build a plan that works for your goals.
Watch the full interview here:
Video courtesy of CBS Miami
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