Oil Is Above $100 a Barrel for the First Time Since 2022. Here's Why Artificial Intelligence (AI) Investors Should Care.

By Reuben Gregg Brewer – Mar 22, 2026 at 5:15PM ESTKey PointsOil and natural gas are rising amid the geopolitical conflict unfolding in the Middle East.Energy is vital to the world economy, and higher prices could cause major disruptions, even to AI.Nvidia (NVDA 3.28%) is the poster child for the artificial intelligence (AI) industry. Its chips are the "brains" that make AI function. However, AI doesn't live in a vacuum. With rising oil and natural gas prices, investors may need to start worrying about the future of AI companies like Nvidia. Here's why. Why are oil prices on the rise? The geopolitical conflict in the Middle East has resulted in major supply disruptions. The headline-grabbing problem is oil, but natural gas, chemicals, and even fertilizer markets have also been impacted. When supply is constrained in a commodity market, prices tend to rise. Image source: Getty Images. At first glance, this shouldn't affect artificial intelligence stocks. To some degree, that's true, as AI use is likely to continue to expand even amid higher energy costs. However, higher costs will ripple through the entire economy. For example, Nvidia can't make its chips without power, and natural gas is used to generate power. It may find its manufacturing costs heading higher as a result. That's just one small example in what is a vast AI ecosystem. Reliable and affordable power is also a major bottleneck for companies that build and operate the data centers that house AI. As power prices rise, it will likely become more expensive to build and operate AI infrastructure, altering the technology's cost-benefit analysis. That said, costs are likely to rise throughout the economy, as well. Fertilizer costs have also risen dramatically, and that could lead to food inflation. Consumers are already tightening their budgets, so higher costs for gasoline, electricity, and food could easily push the U.S. economy into a recession. If that spills over to the rest of the world, AI could run into a very big wall. The AI build-out story could be at risk There are estimates that as much as $700 billion could be spent on the AI build-out in 2026. That's a huge sum of money, but all of that capital investment depends on the belief that there will be a satisfactory return. Large capital investment projects, such as building data centers, constructing factories, and even investing in new technology (such as AI), tend to be cyclical. During a recession, spending on such things often gets delayed or even canceled. ExpandNASDAQ: NVDANvidiaToday's Change(-3.28%) $-5.86Current Price$172.70Key Data PointsMarket Cap$4.2TDay's Range$171.72 - $178.2652wk Range$86.62 - $212.19Volume241MAvg Vol174MGross Margin71.07%Dividend Yield0.02% To be sure, the sky isn't falling. Demand for and use of artificial intelligence will continue to grow even in a worst-case scenario. The real issue for investors is that Wall Street has priced in a lot of good news for many leading AI stocks. Nvidia's price-to-earnings ratio is 36x, which is high on an absolute level and well above the S&P 500 (^GSPC 1.51%) index's P/E of 27x. Nvidia's P/E is actually on the low side compared to some other stocks that have been viewed as AI investments, like Silicon Labs (SLAB +0.23%), which sports a P/E of more than 200x based on adjusted 2025 earnings. ExpandNASDAQ: SOUNSoundHound AIToday's Change(-4.73%) $-0.33Current Price$6.55Key Data PointsMarket Cap$2.8BDay's Range$6.47 - $6.9252wk Range$6.47 - $22.17Volume30MAvg Vol27MGross Margin32.96% There are also many AI companies that haven't yet achieved sustainable profits, such as SoundHound AI (SOUN 4.73%). While the stock has lost two-thirds of its value, investors could continue selling if AI spending starts to slow. Investment fads always end AI is as important a technology as the internet was at the turn of the century. But, as with the internet, not every company will end up a winner, and even the winners may find that investors won't continue to support lofty valuations forever. It may be too early to say that rising oil prices are going to burst the AI bubble, but AI investors shouldn't ignore the potential for that to happen, given the history of bubbles on Wall Street.Read NextMar 22, 2026 •By Bram BerkowitzNvidia's CEO Jensen Huang Just Guided for $1 Trillion of GPU Orders Through 2027. Why Aren't Investors Buying the Stock?Mar 22, 2026 •By Adria CiminoThe Era of AI Agents Has Arrived. 2 Stocks on Track to Win.Mar 22, 2026 •By Sean WilliamsNvidia and Advanced Micro Devices Have Sounded a $711 Billion Warning to Wall Street That AI Investors Simply Can't IgnoreMar 22, 2026 •By Geoffrey Seiler2 AI Stocks to Buy Before They Soar 80% and 50%, According to Wall Street AnalystsMar 22, 2026 •By Danny Vena, CPA1 Growth Stock Dynamo to Buy Before It Soars Past $8 Trillion, According to 1 Wall Street AnalystMar 21, 2026 •By Keithen DruryIs the Stock Market Sending a Warning Signal About Artificial Intelligence (AI) Stocks?About the AuthorReuben Gregg Brewer is a contributing Motley Fool stock market analyst covering energy, utilities, REITs, and consumer staples. He is the former director of research at Value Line Publishing, where he rose from mutual fund analyst to equity analyst before leading all research operations. Reuben holds a bachelor’s degree in psychology from SUNY Purchase, a master’s in social work from Columbia University, and an MBA from Regis University. He has been featured as a financial expert on CNBC and in the Financial Times, Barron’s, and InvestmentNews.TMFReubenGBrewerStocks MentionedNvidiaNASDAQ: NVDA$172.70(-3.28%)-$5.86S&P 500 IndexSNPINDEX: ^GSPC$6,506.48(-1.51%)-$100.01Silicon LaboratoriesNASDAQ: SLAB$206.25(+0.23%)+$0.47SoundHound AINASDAQ: SOUN$6.53(-5.09%)-$0.35*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.