The price of crude oil could soon reach $ 50: what does this mean for the Indian economy?

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By Enda Curran and Michelle Jamrisko

Just a few months ago, major oil trading houses had predicted the return of $ 100 worth of crude oil. Now, with oil prices at half this level, here's a snapshot of what the recession means for the global economy.

Energy importers such as India and South Africa will benefit. oil producers such as Russia and Saudi Arabia will hurt. Central banks under pressure to raise interest rates will benefit from a stay; those seeking to restore prices, like the Bank of Japan, are facing another adverse wind.

In the end, it all depends on how the world's demand for oil will come when the strong dollar and world trade hurt, and the reaction of the biggest producers.

Capture "title =" Capture "/> <figcaption/></figure> <p> Saudi Arabia lies between Russia on one side, its ally in the management of production to support the price, and the United States, where President Donald Trump sends Twitter All eyes are turned to the meeting of the Group of 20 this week to see if a consensus on production emerges between the Saudis and Russians and if this can be done continue until the meeting of OPEC next week. </p> <p> Here is a Bloomberg Economics chart showing net oil imports (or exports) as a percentage of GDP – a cheaper oil helps people at the top of the chart and hurts those at the bottom of the list. </p> <p><figure clbad= c1 "title =" c1 "/> <figcaption/></figure> <p> <strong> What Does This Mean for Global Growth? </strong><br /> <br /> Approaching Winter in the northern hemisphere, falling oil prices will dampen households Oil-importing countries with current account deficits, such as South Africa, could also benefit. the world's largest importer of oil and is already fighting a wider slowdown in its economy, in a trade war with the United States and national challenges.<br /> <br /><strong><br /> What does this mean for inflation? </strong><br /> <br /> Falling oil prices mean less pressure on inflation and less pressure on central banks to raise interest rates. An example: Bloomberg Economics says the energy crisis is changing the deal for India and could mean that the Reserve Bank of India takes a neutral outlook.<br /> <br /><strong><br /> How will emerging markets deal with falling prices? </strong><br /> <br /> Every $ 10 a barrel drop in oil prices raises revenues by about 0.5 to 0.7 percent of the gross domestic product of major emerging-market petroleum importers, say badysts at Capital Economics. The same rebate will result in a 3 to 5 per cent GDP loss in most Gulf economies and a 1.5 to 2 per cent slump in GDP in the United Arab Emirates, Russia and Nigeria on an annualized basis. according to badysts.<br /> <br /><strong><br /> What does it mean for the world's largest economy? </strong><br /> <br /> Trump described the fall in the price of oil as the equivalent of a reduction in taxes. Nevertheless, the decline in US dependence on imported oil due to the emergence of shale production will negatively impact the economic benefits to the industry.<br /> </p> <figure clbad= Mowat-Creative "title =" Mowat-Creative "/> <figcaption/></figure> <p> </p> </p></div> <p> <script></p> <p>if (geolocation && geolocation! = 5) { ! function (f, b, e, v, n, t, s) {if (f.fbq) return; n = f.fbq = function () {n.callMethod? n.callMethod.apply (n, arguments): n.queue.push (arguments)}; if (! f._fbq) f._fbq = n; n.push = n; n.loaded =! 0; n.version = 2.0 & # 39 ;; n.queue = []; t = b.createElement (e); t.async =! 0; t.src = v; s = b.getElementsByTagName (e) [0]; s.parentNode.insertBefore (t, s)} (window, document, & quot; script & # 39; & # 39; https: //connect.facebook.net/en_US/fbevents.js&#39;); fbq (& # 39 ;, & # 39; 338698809636220 & # 39;); fbq ("track", "Pageview"); }</p> <p></script></pre> </pre> [ad_2] <br /><a href=Source link

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