P&G’s oil bill just got expensive

When soap gets squeezed by oil

P&G is warning that higher oil prices could hit profit by roughly $1 billion. Translation: the company’s giant, predictable consumer-products engine is now dealing with a messier fuel bill, and that tends to show up in margins before it shows up anywhere else.

Why you should care

P&G lives and dies by boring things done well — detergent, diapers, shampoo, the whole “buy it, use it, repeat forever” business. But boring only works when costs stay manageable. If crude keeps climbing, those packaging, transport, and raw-material costs start nibbling at the profit pie.

The investor angle

This isn’t a demand panic or a brand-collapse story. It’s a margin story, which is sneakier. If P&G can’t fully pass those costs on to shoppers, earnings can get squeezed even if sales hold up. And if it does pass them on, you get the classic consumer-staples tradeoff: protect margins now, risk a little volume later.

Big picture: P&G is still the kind of stock people buy when they want steady, not spicy. But steady gets less soothing when oil decides to crash the household-budget party.