FEAR & GREED | Business News Q+A: Oil shock rattles markets - should investors panic?
Mar 9, 2026
Dr Shane Oliver, AMP’s Chief Economist and Head of Investment Strategy, provides quick macro and market context. He explains why oil shocks still move markets. He compares the recent spike to past shocks. He outlines possible oil-price paths and implications for equities and central bank moves. He ends with a calm warning against emotional, short-term market reactions.
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Why Oil Shocks Still Hit Growth
- Oil shocks still matter because oil is a critical input to transport, aviation and logistics that directly feeds into GDP and consumer prices.
- Shane Oliver notes oil intensity of GDP is ~70% lower than the 1970s but a supply shock still reduces growth via higher prices and weaker export demand.
Markets Were Complacent Before The Spike
- Markets were unusually complacent a week earlier, with the Aussie market reaching a record high despite geopolitical tension.
- Shane Oliver recalls traders assuming disruptions would be brief and that past leaders would de-escalate, explaining initial market calm.
Past Middle East Shocks Explain Big Oil Moves
- A 25% one-day rise in oil is extreme but not unprecedented; past Middle East events produced multi‑fold spikes in oil prices that strongly affected economies.
- Oliver compares 1973, 1979 and 1990 shocks and the 2022 Ukraine-related spike to show historical precedent.