Oil price volatility never remains restricted to just the energy sector. Volatile moves in the price of either WTI or Brent can very soon impact inflation forecasts, central bank policies, currency values, indices, and overall risk sentiments.
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Why oil moves affect more than energy
Costs of oil have a large impact on logistics, transportation, production processes, and consumption. Higher prices mean higher expenditures for companies, thus putting more inflationary pressure. In turn, that might affect market expectations concerning interest rates if central banks are trying to contain inflation.
On the contrary, lower costs of oil may create a situation where there should be no worries about inflation
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