US GDP Growth Slows as Tariffs and Oil Price Hikes Create Supply Shock

The United States' gross domestic product (GDP) growth slowed in the second quarter of 2026, according to recent data. The primary causes are newly imposed tariffs and a sharp increase in oil prices, which together have created a supply shock in the economy.

A supply shock means production costs rise while the availability of goods and services diminishes, putting upward pressure on prices and dampening economic activity. Tariffs have made imported goods more expensive, while higher oil prices have raised transportation and manufacturing costs.

Economists suggest that these factors could continue to weigh on growth in upcoming quarters unless measures are taken to ease supply-side constraints.

The exact magnitude of the slowdown has not been disclosed, but the trend indicates a deceleration compared to previous periods.