This analysis estimates the impact of temporary and permanent increases in oil prices of various magnitudes on the Czech economy, inflation, interest rates and the koruna exchange rate. In general, our estimate suggests that a temporary 10% increase in oil prices would have only a limited impact on GDP growth and inflation. However, a permanent increase of the same magnitude would lead to visible inflationary pressures, higher interest rates and increased government bond yields, accompanied by a more significant weakening of the koruna. Nevertheless, the actual response may currently be milder than the results presented, given the Czech economy’s gradually declining energy intensity. The volatility of the koruna exchange rate is also less pronounced than in the past, while depreciation is an important factor in transmitting the oil shock to final prices.