You do not drive a car and think the oil price does not concern you. You work from home, shop locally, and heat with a heat pump. Congratulations – it is hard to get further away from the gas pump in German everyday life.
However: your breakfast roll was delivered. Your refrigerator runs on electricity. Your heat pump depends on the energy mix. And the T-shirt you are currently wearing is highly likely not free of fossil raw materials or energy-intensive supply chains.
In an economy based on the division of labor, there is no “them over there” and “us over here.” The oil price moves through transport, production, packaging, electricity costs, logistics, and demand. The question is not whether it affects you. The only question is how many corners it must turn before it reaches you.
1 | Layer one: The obvious
Transport, logistics, trades, care, agriculture, heating. Here, one does not need to explain for long why energy prices play a role. This can be seen at the gas pump, on the utility bill, and now also on many invoices.
What many underestimate is not whether, but the extent. If diesel becomes more expensive, delivery costs rise. If gas and electricity become more expensive, the costs for cooling, ovens, machinery, workshops, and buildings increase. These costs do not disappear out of politeness. They are passed on, absorbed, or saved elsewhere.
And that is exactly where the actual problem begins: what becomes more expensive during transport appears later in the price of goods. What becomes more expensive in operations appears later in the service invoice. Energy does not stop at the gas station. It runs through the entire chain.
2 | Layer two: One step deeper
Now it gets more interesting. Because the oil price is not only in transport, but often also in the products themselves.
Your bread roll. The wheat was harvested with a diesel-powered combine harvester. The flour was dried with natural gas. The yeast was produced in an energy-intensive fermentation process. The packaging consists of petroleum-based plastic. The transport from the warehouse to the bakery: diesel. And then the baker stands at the gas oven at 3 AM. At least five points of contact with the oil price – before you even take a bite of the roll.
Your house construction. Cement requires temperatures of 900 degrees. Steel requires 1,500 degrees. Added to this are the transport of building materials by truck, the operation of construction machinery with diesel, and asphalt for the driveway – obtained directly from petroleum. When construction prices rise, it is not just due to interest rates and a shortage of skilled labor. It is also because energy is embedded in almost every building material.
Your restaurant visit. Food is produced, cooled, delivered, and processed. The dining area is heated. Employees must get to work. At the same time, the guests themselves have less money left over when mobility and the cost of living become more expensive. The restaurateur feels high energy prices on both the cost and demand sides. A decidedly unpleasant and reliable double blow.
Your hair appointment. Shampoo, hair dye, styling products – the basic materials are petrochemical. The salon needs hot water, heating, and electricity for hair dryers and straighteners. The beautician next door has the same problem in a more acute form: creams, polishes, waxes – almost all petroleum-based. Both businesses operate locally and manually. The cost structure behind them is global and energy-dependent.
Your hotel stay. Heating or air conditioning around the clock, daily linen changes in industrial washing machines, breakfast buffet (see bread rolls), cleaning agents, bed linen made of polyester blends. And when business travelers save and vacationers take shorter trips because everything is becoming more expensive, occupancy rates drop – fixed costs per guest rise. Here too: a double blow.
3 | Layer three: Where you don’t expect it
This is where the misconception in many debates lies: what seems digital, medical, or “light” quickly appears to be independent of the oil price. This is a mistake.
Medication, doctor’s office, hospital. Many pharmaceutical active ingredients are synthesized from petrochemical precursors – ibuprofen, paracetamol, aspirin. Production takes place in energy-intensive clean rooms, and transport occurs in temperature-controlled supply chains around the globe. If your pack of ibuprofen becomes more expensive, that is not a pharmacist’s surcharge – that is the oil price trickling through five production stages.
And it doesn’t stop at the pill. Disposable gloves, syringes, disinfectants, sterile packaging – plastic, meaning petroleum. A hospital is a building with enormous energy consumption: operating rooms, intensive care units, sterilization, laundry, kitchen, 24 hours a day. The resident physician heats his practice, makes house calls, and orders consumables that arrive by truck. To act as if energy prices and healthcare costs have nothing to do with each other would be about as plausible as a hospital without electricity.
Clothing. Around 60 percent of all textile fibers worldwide are synthetic – polyester, nylon, acrylic, meaning petroleum. And even where natural fibers are processed, energy, transport, chemicals, dyeing, and global supply chains remain significant cost factors. Even the wash cycle at home consumes electricity and hot water. Clothing is not an oil-price-free zone.
Digital services. The idea that streaming, cloud, or software are decoupled from the oil price is particularly charming – and particularly wrong. Hardware is produced and transported globally. Data centers consume massive amounts of electricity. And when costs explode elsewhere for companies or households, budgets for digital services, advertising, subscriptions, and new orders simply decrease. The oil price does not always directly impact the individual price there. But it plays a role through costs and demand.
Education. School buildings are heated. School buses run on diesel. Teaching materials are manufactured, printed, packaged, and delivered. Even purely digital further education depends on end devices, networks, and data centers. Less visible, but by no means independent.
4 | Layer four: The shortest list in the world
And where does the oil price really play no role?
If one is honest: almost nowhere.
Perhaps with a street musician who walks to his usual spot and plays on an inherited guitar. No supply chain, no workshop, no fleet of vehicles. But the independence ends quickly. Because if people have less money in their wallets because energy, transport, and housing have become more expensive, he also faces a smaller audience with tighter pockets. His product is oil-price-free. His customers are not.
This is the punchline that regularly gets lost in the political debate: Fuel prices are not a topic for drivers only. They are an economic topic. Every company that produces, transports, heats, cools, or purchases is affected. Every consumer who uses products or services that had to be produced, transported, or operated is affected. So – with all due respect – everyone.
5 | Why this is important
The realization that energy prices run through the entire economy sounds banal. However, it has concrete consequences.
For the inflation debate. When energy becomes more expensive, the effect does not arrive simultaneously, but with a time delay in different sectors. What becomes more expensive today in transport and procurement will be on invoices tomorrow, on price tags later, and eventually in investment decisions. Anyone who says inflation is under control while energy prices are rising is confusing a delay with an all-clear.
For the regulatory debate. Anyone who regulates the fuel price in isolation is looking at a symptom in a single place – while the cause continues to flow through all other channels. A rule at the gas pump helps the commuter at 11:30 AM. It does not help the baker whose flour price has risen.
For anyone who thinks this does not concern them. In an economy based on the division of labor, everyone is a customer, client, or contractor for someone else. If one small wheel falters, it doesn't stop with that one wheel. It just takes a while for the rest to notice.
Key takeaway: The question "Where is the oil price not included?" has a very short answer: almost nowhere. In an economy based on the division of labor, energy is the invisible component of almost every good and almost every service. Anyone talking about energy prices is talking about everything.
This post is part of the series Economics for Adults – economic relationships explained without the ivory tower.
Petra Nieweg is an attorney and graduate economist (Dipl.-Volkswirtin) in Steinhagen. She advises companies and private individuals at the intersection of law and economics.
Do you have questions about the economic consequences of rising energy costs for your company? Write to me.
