“The problem with higher oil prices is that it acts as an indirect tax on consumers and businesses,” said Adam Sarhan, chief executive of Sarhan Capital. He noted that the rise in oil prices comes as investors are also beginning to wonder how the economy will perform after the Federal Reserve winds down its stimulus program in June.
Sarhan added, “What we’re seeing now is a confluence of two factors: Can the economy continue growing without the Fed’s help, and how will the economy continue to grow if oil spikes higher?”