Interactive Brokers Economist Warns Oil Prices Above $120 Pose Risk to Consumer Spending
On September 9, 2026, West Texas Intermediate (WTI) crude oil prices rose above $97 per barrel after a monthly gain of over 16%, with Brent crude also crossing the $100 threshold. This has raised concerns about its impact on consumer spending in the U.S., particularly as gasoline prices have surged to $4.32 per gallon, reaching the 90th percentile for the past year and increasing by nearly 7.8% over a month. Interactive Brokers senior economist Jose Torres warned that oil prices above $120 would pose serious risks to consumer spending, citing historical parallels with June 2022 when WTI reached similar levels before triggering one of the fastest tightening cycles in four decades. Current economic indicators suggest households are less resilient: the personal savings rate has dropped from 6.2% (Q1 2024) to 2.8% (Q2 2026), and consumer sentiment remains below recessionary thresholds. Market behavior reflects growing caution, with energy stocks surging while consumer discretionary sectors decline. The Energy Select Sector SPDR Fund has gained nearly 46% year-to-date compared to a 7% drop in the Consumer Discretionary sector. Defensive staples have risen by almost 9%, and financials are up only slightly at around 4%. These shifts indicate investors are rotating toward safer assets as concerns about growth persist.
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Topics: consumer spending economic risk oil prices WTI crude