A supply shock occurs when an unexpected event disrupts the production or availability of goods and services in the market. This can lead to sudden increases in prices and shortages of products. Common causes of supply shocks include natural disasters, geopolitical tensions, or significant changes in regulations. When a supply shock happens, it can affect various sectors of the economy. For example, a hurricane might damage oil refineries, leading to higher fuel prices. Similarly, a pandemic can disrupt global supply chains, causing delays and shortages in everyday items like electronics or food products.