Oil Price Surge May Force Higher US Interest Rates

Oil prices above $100 per barrel may lead to higher US interest rates, according to Richard Bensel, Professor of Government at Cornell University.

Bensel believes that recent increases by the European Union and Japan make an increase by the Federal Reserve even more probable.

The expert warns that high crude oil prices will trickle down the economy and raise inflationary pressures on everything that has to be physically transported.

He notes that once the economy adjusts to those pressures, it will be difficult to bring retail prices back down even if the price of crude decreases.