11 August 2026 · GlobalReal exampleDeep Dive15-marker25-marker
EIA expects Brent oil to ease from about $85 as supply recovers
The EIA expected Brent crude to average about $85 a barrel in Q3 2026 before easing to around $69 in 2027 as inventories rebuild. This gives students a specific, current supply-shock example rather than a generic statement that oil prices are volatile.
Chain
Higher oil prices → higher transport and production costs → SRAS shifts left → price level rises and real output falls; falling oil prices can reverse part of this pressure
Evaluation
Oil-price effects differ between importing and exporting economies and depend on how persistent the price move is, how energy-intensive production is and whether firms pass costs on to consumers.
Diagram
AD/AS diagram showing an oil-price shock changing short-run aggregate supply