G7 Talks, Strategic Reserves, and Oil: My Prediction for the Next Catalyst for Markets

By Reuben Gregg Brewer – Mar 12, 2026 at 9:15PM ESTKey PointsThe geopolitical conflict in the Middle East has investors on edge and oil prices rising.Higher costs are already worrying consumers, and rising oil prices aren't in the mix yet.When seemingly good news is greeted as negative news on Wall Street, you need to start worrying. That's exactly what happened when countries around the world agreed to release oil from their strategic reserves to quell concerns in the oil market. The decision ultimately resulted in higher oil prices. Here's the next big catalyst I see, and there's no way to avoid it. You see high oil prices, but the data doesn't Consumers see high oil prices very quickly in the form of higher gas prices. However, those prices aren't reflected in the inflation data being released right now because it's backward-looking. Inflation came in as expected in February, but when the March data is released, the rate of inflation is likely to push higher due to the spike in oil prices. Image source: Getty Images. However, that's not the end of the story. Oil and natural gas are vital to the world economy. They are used by utilities to generate power, by consumer staples companies to make and transport products, and even by farmers in food production. The full impact of rising oil and natural gas prices will take time to flow through the economy, which suggests that inflation could run hot for longer than many hope. The market hates inflation Research from The Motley Fool shows that inflation has historically averaged around 3.8% a year. But that's an average; over short periods, it can rise materially above that figure. When inflation is above 5%, the S&P 500 index (^GSPC 1.52%) has returned only 2.4%. My concern is that oil prices will lead to a lingering uptick in inflation numbers. That, in turn, will increase recession concerns among investors, if not tip the economy into one. And that could precipitate a bear market. ExpandSNPINDEX: ^GSPCS&P 500 IndexToday's Change(-1.52%) $-103.18Current Price$6672.62Key Data PointsDay's Range$6670.40 - $6740.8852wk Range$4835.04 - $7002.28Volume3.5B Stocks are still trading near all-time highs, so that fear may seem out of line with the market reality. However, daily price swings have been quite large. That's not a great sign for the future because it means investors are being driven by their own emotional swings. The big news right now is the ongoing geopolitical conflict. If inflation rises because of high oil prices, as I expect, fear will increase, and investors will become even more skittish. That could easily lead the S&P 500 index into a deep downturn. Don't waste the opportunity The time to prepare is now, before a bear market comes along. Create a wish list of stocks that you would like to own if only they were cheaper. That way, you'll be prepared to buy while others, driven by fear, are selling. If the bear never materializes, the worst thing that happens is that you made a list of stocks that you won't get to use.Read NextMar 12, 2026 •By Reuben Gregg BrewerWeak Jobs Data and Rising Oil Prices at the Same Time: Why Investors Are Now Facing a Much Harder Market to ReadMar 12, 2026 •By Adria CiminoShould You Really Buy Stocks During Market Turbulence?

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History Says It's About to Get Worse.Mar 12, 2026 •By Johnny RiceThe Stock Market Sounds an Alarm as Oil Prices Surge to Their Highest Level in Years. History Says the S&P 500 Will Do This Next.Mar 11, 2026 •By Emma NewberyStock Market Today, March 11: Oracle Surges as Markets Weigh Geopolitical RisksAbout 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 MentionedS&P 500 IndexSNPINDEX: ^GSPC$6,672.62(-1.52%)-$103.18*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.