There's a stretch of water on the other side of the world, barely 20 miles wide, that reaches into your wallet faster than anything Washington does. It's called the Strait of Hormuz, and a fifth of the planet's oil moves through it. One rumor, one drone, one tanker out of place, and the price at your pump jumps overnight. You felt it this summer, and you'll feel it again.
Here's what most people get wrong. They think the barrel of crude is the whole story. It isn't. When trouble flares over there, insurers get nervous. Premiums climb, or coverage gets pulled, and the whole chain that moves oil from the ground to your tank tightens up. Crude can run from the low 70s to the mid 90s in a matter of weeks, not because the world ran short of oil, but because the market is pricing in fear.
And it doesn't stop at the pump. Oil runs through diesel, trucking, air freight, plastics, fertilizer, and the food on your shelf. When it moves, inflation moves, and when inflation moves, interest rates move with it. A narrow strip of water you'll never see ends up touching the retirement you're counting on.
So what do you do about it? You can't cap a well or calm a headline. But you can have a plan that doesn't flinch every time one hits. That means discipline when everyone else is reacting, enough cash set aside that a spike doesn't force your hand, and a withdrawal strategy stress-tested against exactly this kind of inflation. The people who get hurt are the ones who react to the headline.
That's what Skip and I get into on this episode of the Four Seasons Podcast. Give it a listen. And if it raises a question about your own plan, let's talk.
Keep the Faith. God Bless America.
Jeff