Wall Street had its biggest drop in more than a year Monday as another leap for oil prices threatened to squeeze inflation’s grip on the global economy. The S&P 500 fell 3%, its biggest decline in 16 months, after a barrel of US oil surged to $130 overnight on the possibility the US could bar imports from Russia. Stocks around the world also fell earlier in the day, taking their cue from oil’s movements, though their losses moderated as crude receded toward $120 per barrel. The benchmark S&P 500 fell 122.78 points to 4,201.09. The Dow Jones fell 797.42 points, or 2.4%, to 32,817.38. The Nasdaq composite slid 482.48 points, or 3.6%, to 12,830.96. The tech-heavy index is now 20.1% below its record set in November. Such a decline means the index is now in what Wall Street calls a bear market. The S&P 500 is down 12.4% from the peak it set in early January. Oil prices have soared recently on worries that Russia’s invasion of Ukraine will upend already tight supplies. Russia is one of the world’s largest energy producers, and oil prices were already high before the attack because the global economy is demanding more fuel following its coronavirus-caused shutdown. Markets worldwide have swung wildly recently on worries about how high prices for oil, wheat and other commodities produced in the region will go because of Russia’s invasion, inflaming the world’s already high inflation. In the United States, prices for consumers jumped last month from their year-ago level at the fastest rate in four decades. The conflict in Ukraine also threatens the food supply in some regions, including Europe, Africa and Asia, which rely on the vast, fertile farmlands of the Black Sea region, known as the “breadbasket of the world.” The war puts extra pressure on central banks around the world, with the Federal Reserve on course to raise interest rates later this month for the first time since 2018. Higher rates slow the economy, which hopefully will help rein in high inflation. But if the Fed raises rates too high, it risks forcing the economy into a recession. Some investors have seen the war in Ukraine as potentially pushing the Fed to go easier on rate increases. Investors love low rates because they tend to boost prices for stocks and all kinds of markets. But that may not necessarily be the case this time, Goldman Sachs economists wrote in a report. With prices for oil, wheat and other commodities potentially rising even more, the threat is higher for a sustained, high inflation to settle on the economy. That could flip the Fed’s traditional playbook. Beyond sanctions brought on Russia by governments because of its invasion of Ukraine, companies are also levying their own punishments. The list of companies exiting Russia has grown to include Mastercard, Visa and American Express, as well as Netflix. The value of the Russian ruble continued to slide amid all the financial pressure, falling 12% to 0.7 cents.