Since the war in the Middle East began, one narrative on Wall Street has suggested that elevated oil prices could indicate we’re headed toward higher inflation.But over the last few days, a new narrative seems to be taking hold: lower oil prices are going to lead to more consumption. And that heightened consumption could also mean higher inflation.Earlier in the war, when a barrel of oil cost $25 more than it does today, markets worried about inflation caused by a tight supply of oil.But now, according to Nathan Thooft with Manulife Investment Management, “we’re moving what appears to be toward a concern towards the demand side.”He said falling oil prices solve the supply-side inflation problem, but they also cause more demand.“So people start thinking about inflation, driven by the fact that the economy might actually improve, because we’re no longer having to worry about higher energy prices,” Thooft said. “The consumer has those dollars, then, to spend on other things.”And that can lead to inflation, too.Thooft said that’s a concern for stock markets because, in that case, the Federal Reserve might raise interest rates. And that raises costs for businesses.Guy LeBas with Janney Montgomery Scott said bond markets have been expecting higher interest rates.That’s been pushing up bond yields and the value of the dollar.“Much of that follows from Kevin Warsh’s Federal Reserve press conference last week, in which he struck a tone that was hinting at higher interest rates,” LeBas said.Of course, things might not end up playing out this way.According to David Kelly with J.P. Morgan Asset Management, consumers might not have extra money to spend.“The key thing to recognize here is wage growth is still very low,” Kelly said. “In fact, the May number on wage growth was the second-lowest we’ve seen in five years, on a year-over-year basis.”Kelly said population growth is another factor. It’s slowed down, thanks in part to the Trump Administration's crackdown on immigration.“And if you’ve got shrinking demographics, that means less demand for housing, less demand for consumer basics, and of course fewer workers,” Kelly said. “And I think all of that is acting as a constraint on overall economic growth.” And with inflation constrained along with it, Kelly said the Fed will probably keep rates steady.