Oil Prices and Growth

Ray Barrell and Simon Kirby

National Institute Economic Review, 2008, vol. 204, 39-42

Abstract: Over the past fifteen months oil prices have steadily risen from around $60 a barrel to over $100, as we can see from Figure 1. The projections in our forecast are based on information from futures markets and on projections by the US Energy Information Administration, and as prices have risen there has been increasing evidence that they are considered to be overshooting a sustainable position, as can be seen from our projections for oil prices. Oil prices are expected to fall back to $90 a barrel by the end of 2009. Hence the current oil price shock can be seen as a combination of a temporary increase and a permanent increase in oil prices. The impact of increases in oil prices on growth depends in part on the reasons for the increase, with the effects of supply reduction induced increases in prices being more negative than demand induced increases in prices. A supply reduction involves a loss of revenue for producers as compared to a fixed volume demand induced rise in oil prices, and hence a supply reduction would result in lower levels of imports by oil producers.

Date: 2008
References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.cambridge.org/core/product/identifier/ ... type/journal_article link to article abstract page (text/html)

Related works:
Journal Article: Oil Prices and Growth (2008)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:cup:nierev:v:204:y:2008:i::p:39-42_9

Access Statistics for this article

More articles in National Institute Economic Review from National Institute of Economic and Social Research Cambridge University Press, UPH, Shaftesbury Road, Cambridge CB2 8BS UK. Contact information at EDIRC.
Bibliographic data for series maintained by Kirk Stebbing ().