By Rebecca Bundhun
NY economist sees greater impact of low oil prices on oil exporting countries.
The global credit crisis is expected to persist for the entirety of this year and only stage a very weak recovery in 2010, a leading economist warned on Tuesday.Lower oil prices will have greater ramifications for oil exporting countries, he added.
"The financial crisis going to get worse before it gets better," said Nouriel Roubini, Professor of Economics and International Business at New York University, speaking at The Economist's 'The World in 2009' forum in Dubai.
"In severe recession, oil, energy and commodity prices will fall further even from current levels. Thus, oil exporting countries around the world and in the Middle East will suffer from this very sharp fall in oil and energy prices."
Given Roubini's prediction that the global recession will persist throughout 2009, he see oil prices at around $30 to $40 per barrel this year. By contrast, many more optimistic economists have suggested that oil prices will climb in the second half of 2009.Oil prices have plunged some $100 from a peak of $147 last July.
I refer to my earlier comments :-) The average, inflation adjusted, price since 1946 is somewhere between $35-$40. The mean price for 08 was about $99, the last time we had this was about $95 in 1980.
You don't have to be much of an expert to predict a less than favourable price for commodities when there is reduced demand caused through recession. If the working people have jobs - they spend money on consumer items - If people have no work they don't. Get people back to work - money starts to flow "cause people want to buy things - you don't need to be an expert to see this - The problem is the wealthiest 4% of the world people don't want to risk there wealth - Banks want to lick there wounds and get back to fat wads of wealth in their coffers and be like usury Shylock's again. in the mean time expecting Governments to bail them out and get industry going