What impact will rising oil prices have on the global economy, and why?

Question

What impact will rising oil prices have on the global economy, and why?

Answer 1

Since oil is (still) a major source of energy, a massive rise in oil prices will act as a "supply shock."  This means that since most consumers and businesses use oil in some way or another, it will push their operating costs up and lead to higher prices for many goods.  With more money spent on gasoline, etc. consumers will have less to buy other stuff.  

So we should expect prices (inflation rates) to increase and output (economic growth) to decrease.  This is called "stagflation" and it happened in the 1970s under similar circumstances.