Fed is hard to react to oil supply shock.
1/ Fed is designed to manage demand. It cannot produce more oil or open shipping lanes. Historically, the Fed “looks through” supply shocks unless they start to bleed into the broader economy (secondary effects / expectation for inflation rises).
2/ Energy shocks often spike and subside relatively quickly. However, Fed policies take months or even years to fully permeate the economy. Fed would be slowing down the economy exactly when it might be trying to recover from the high energy costs.
“By the time the effects of a tightening in monetary policy take effect, the oil price shock is probably long gone, and you’re weighing on the economy at a time when it’s not appropriate.”