CNBC host Jim Cramer said that oil prices around $40 a barrel, together with price cuts from major retailers, could push U.S. inflation sharply lower. He noted that Brent crude would need to fall roughly 56% from its recent level to reach that price.
Recent CPI data
October’s Consumer Price Index (CPI) rose 0.4%, above the 0.3% forecast, after Brent gained more than 15% during the month. The headline CPI increase kept the possibility of a Federal Reserve rate hike in play, which is a risk factor for Bitcoin and other risk assets.
Cramer’s view on oil and inflation
Cramer argued that oil prices affect food, recreation, and motor‑vehicle insurance costs. He referenced a chart from Valero, a U.S. oil refiner, suggesting a $40 crude price scenario, which also assumes that retailers such as Walmart and Costco would pressure suppliers to lower prices.
Current oil market
Brent crude fell to about $92 per barrel, after a reported U.S.–Iran Hormuz deal and a pause in potential strikes. The price had risen more than 15% in October and was up about 60% for the year as of late September.
Implications for the Fed
Headline CPI rose 0.4% while core CPI, which excludes food and energy, increased 0.3%. Fed Governor Christopher Waller said the core reading could lead him to consider a half‑point hike in December, and Dallas Fed President Lorie Logan called for at least two more quarter‑point hikes.
Market reaction
Bitcoin fell following the CPI release, triggering roughly $200 million in crypto‑related liquidations. The Federal Reserve’s next meeting is scheduled for Dec. 8‑9, one day before the November CPI data is released, meaning any oil‑price relief would arrive after the Fed’s decision.
