# Crypto Insights | Oil Price Costs Can Be Passed On, Airlines' Debt Must Endure Inflation

Wang Zhai is not surprised by the United States and Israel taking joint military action against Iran. The hardest part to estimate is how long the conflict will last. The recent surge in oil prices reflects how the situation might develop and when it might end, with uncertainty remaining. At least the Strait of Hormuz, one of the world’s key oil transportation routes, is temporarily blocked.

The cumulative increase in oil prices has been quite remarkable. A “bond friend” asked whether high oil prices would impact bonds in high-consumption industries like airlines and cruise lines. When oil prices rise sharply, most airlines pass the costs onto passengers by raising ticket prices, fuel surcharges, or adjusting routes.

Wang Zhai has always told “bond friends” not to panic over negative news but to calmly analyze companies’ pricing power, which might even present an opportunity to buy at a lower price. After all, airlines and cruise companies have weathered the pandemic storms, so there’s no reason they can’t survive rising oil prices. Moreover, oil prices haven’t yet reached historical highs. Ha!

(Excerpt)

Wang Zhai Talks Bonds, The Deer and the Ding Record

Please read today’s China Times for the original.