Global Implications of Lower Oil Prices

Author: Mr. Aasim M. Husain
Publisher: International Monetary Fund
ISBN: 151357227X
Format: PDF
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The sharp drop in oil prices is one of the most important global economic developments over the past year. The SDN finds that (i) supply factors have played a somewhat larger role than demand factors in driving the oil price drop, (ii) a substantial part of the price decline is expected to persist into the medium term, although there is large uncertainty, (iii) lower oil prices will support global growth, (iv) the sharp oil price drop could still trigger financial strains, and (v) policy responses should depend on the terms-of-trade impact, fiscal and external vulnerabilities, and domestic cyclical position.

Oil Prices and the Global Economy

Author: Mr.Rabah Arezki
Publisher: International Monetary Fund
ISBN: 147557780X
Format: PDF, ePub, Docs
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This paper presents a simple macroeconomic model of the oil market. The model incorporates features of oil supply such as depletion, endogenous oil exploration and extraction, as well as features of oil demand such as the secular increase in demand from emerging-market economies, usage efficiency, and endogenous demand responses. The model provides, inter alia, a useful analytical framework to explore the effects of: a change in world GDP growth; a change in the efficiency of oil usage; and a change in the supply of oil. Notwithstanding that shale oil production today is more responsive to prices than conventional oil, our analysis suggests that an era of prolonged low oil prices is likely to be followed by a period where oil prices overshoot their long-term upward trend.

Emerging Markets and the Global Economy

Author: Mohammed El Hedi Arouri
Publisher: Academic Press
ISBN: 0124115632
Format: PDF, Docs
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Emerging Markets and the Global Economy investigates analytical techniques suited to emerging market economies, which are typically prone to policy shocks. Despite the large body of emerging market finance literature, their underlying dynamics and interactions with other economies remain challenging and mysterious because standard financial models measure them imprecisely. Describing the linkages between emerging and developed markets, this collection systematically explores several crucial issues in asset valuation and risk management. Contributors present new theoretical constructions and empirical methods for handling cross-country volatility and sudden regime shifts. Usually attractive for investors because of the superior growth they can deliver, emerging markets can have a low correlation with developed markets. This collection advances your knowledge about their inherent characteristics. Foreword by Ali M. Kutan Concentrates on post-crisis roles of emerging markets in the global economy Reports on key theoretical and technical developments in emerging financial markets Forecasts future developments in linkages among developed and emerging economies

Crude Volatility

Author: Robert McNally
Publisher: Columbia University Press
ISBN: 0231543689
Format: PDF, Mobi
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Oil is the lifeblood of modern civilization, ranking alongside food as one of our most critical commodities. It drives geopolitical, economic, and financial affairs, as well as environmental debates and policymaking. As the place of oil in our global economy has evolved, so too has the way we buy and sell it, with rudimentary transactions at the wellhead developing into a sophisticated and complex global market. Yet while today’s oil market bears little resemblance to the one born in the valleys and creeks of western Pennsylvania more than 150 years ago, one core feature remains: a natural tendency toward boom and bust price cycles that can devastate economies, trigger or prolong recessions, and undermine growth and investment. Tracing a history marked with conflict, intrigue, and extreme uncertainty, Robert McNally shows how—even from the very first years of the market—wild volatility in oil prices led to intensive efforts to stabilize price fluctuations and manage supply. First Rockefeller’s Standard Oil, then U.S. state regulators along with major international oil companies, and finally OPEC each enjoyed varying degrees of success in the pursuit of oil price stability. But the spectacular boom of 2008 and bust of 2015 have revealed a structural shift back to extreme oil price swings, the likes of which haven’t been seen for nearly a century. Crafting an engrossing journey from the gushing New England oil fields to the fraught and fractious Middle East, Crude Volatility provides a crucial perspective that discards distractions and tired myths, shows lessons learned from prior mistakes, and provides the historical foundation we need to face, understand, and surmount the challenges ahead.

Global Shocks and the New Global and Regional Financial Architecture

Author: Naoyuki Yoshino
Publisher: Asian Development Bank
ISBN: 9784899740698
Format: PDF, Mobi
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Asian economies continue to be subject to new shocks: US monetary policy tightening, the adoption of negative-interest-rate policies by central banks all over the world, the slowdown of the People’s Republic of China, and the sharp drop in oil and other commodity prices. All these highlight the vulnerability of the region to volatile trade and capital flows even as the global and Asian regional financial architecture evolves. This volume analyzes the vulnerabilities of Asian economies to external economic and financial shocks and assesses the performance of Asian regional institutions in financial surveillance and cooperation. It also evaluates ongoing reforms of the global financial architecture, including the International Monetary Fund (IMF), the Financial Stability Board, and the "Troika” (European Commission, European Central Bank, and the IMF) in managing the European sovereign debt and banking crisis. Based on these, the book develops valuable recommendations to strengthen the Asian regional financial architecture and improve cooperation with global multilateral institutions.

Slowdown in the People s Republic of China

Author: Justin Yifu Lin
Publisher: Asian Development Bank
ISBN: 9784899740773
Format: PDF, ePub, Mobi
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The economy of the People's Republic of China (PRC) has surged almost 10% annually since economic reforms began in 1978, ensuring the PRC's position as an engine of global growth. But by 2016 growth slowed to less than 7%. Is it a structural or cyclical slowdown? If structural, the implications for growth, trade, and investment in other Asian economies will be significant. This book (i) explains the long-term slowdown in advanced Asian economies and what it means for the PRC; (ii) assesses the structural factors shaping the PRC economy and how they will influence its growth over the next decade; (iii) shows how growth, trade, investment, and employment in emerging Asian economies could be impacted; and (iv) evaluates policies that could offset some of the negative factors.

Geopolitics of Oil

Author: Katherine T. Harris
Publisher: Nova Science Pub Incorporated
ISBN:
Format: PDF, ePub, Mobi
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The price and availability of oil and natural gas affects every American. That's why it is important that the Energy Committee's first hearing of the 110th Congress focused on the global oil situation and its implications for U.S. economic and national security interests. As a nation, we now depend on oil imports to meet sixty percent of our oil needs. Even modest disruptions in the world supply can result in price spikes at the pump, as we have seen in recent years. First, there is little surplus production capacity relative to global demand. Much of the current production is controlled by national oil companies that are often making political rather than economic decisions, and are not making the investments needed to maintain and expand production capacity. This book examines the geopolitical factors surrounding the acquisition of oil supplies.

Oil and the World Economy

Author: Mr. Michael Kumhof
Publisher: International Monetary Fund
ISBN: 1475539975
Format: PDF, Docs
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This paper, using a six-region DSGE model of the world economy, assesses the GDP and current account implications of permanent oil supply shocks hitting the world economy at an unspecified future date. For modest-sized shocks and conventional production technologies the effects are modest. But for larger shocks, for elasticities of substitution that decline as oil usage is reduced to a minimum, and for production functions in which oil acts as a critical enabler of technologies, GDP growth could drop significantly. Also, oil prices could become so high that smooth adjustment, as assumed in the model, may become very difficult.