Oil Spikes Again as Wall Street’s Fear Gauge Spiked

Oil prices surged again on Friday, sending Wall Street's fear gauge, the VIX, briefly above 22. Investors worry that rising energy costs could fuel inflation and keep interest rates higher for longer, putting more pressure on stocks.

Wall Street turned nervous on Friday as oil prices surged again, raising fresh concerns about inflation and interest rates.

Brent crude jumped 3.7% to nearly $110 a barrel, while U.S. oil climbed above $101 amid renewed tensions in the Middle East.

The VIX, Wall Street's fear gauge, briefly hit 22.31 before closing near 20, up more than 21%.

The Nasdaq dropped 2.1%, while the S&P 500 lost 1.1%.

Why are investors worried?

Higher oil prices mean more expensive fuel, transportation and everyday goods. That could keep inflation elevated and make it harder for the Federal Reserve to stop raising interest rates.

Higher borrowing costs also put pressure on stocks, especially technology companies.