Continued instability in the Middle East and Northern Africa, most notably in Libya is keeping everyone from oil merchants, traders, politicians through big business leaders up at night. And with good reason instability to major oil producing nations causes the cost of the commodity to rise, and in a post-recession pre-looming-recession environment, many of the world’s major economies look less like their teetering on recovery and more like they just want a few aspirin and a lie down.
Morgan Stanley analysts recently said “sharp increases in oil prices pose the biggest threat to growth because consumers suffer a sudden hit to purchasing power. They note a 85 percent to 90 percent increase in the price of oil over a year was followed by U.S. recessions in 1975, 1980, 1990, 2000 and 2008.” As oil looks like it might climb above $150 a barrel, and Jim Rogers predicting it could hit $200 a barrel, the global economy may well be headed for slippery times. (sorry, couldn’t resist the pun)
On to graphics and charts, below are some fantastic graphics from The Economist about the effects of petrol and oil prices on some of the world’s major economies.