The article examines how different types of oil shocks affect the US economy from 1986 to 2019. By using a large model with common stochastic volatility, the researchers analyzed the impacts of oil supply, global oil demand, and precautionary oil shocks on various economic and financial variables. They found that all oil shocks lead to long-term inflation, global oil demand shocks have negative effects on the economy despite GDP growth, and all oil shocks harm the US stock and currency markets in the long run. The effects on the bond market vary.