Economic growth is continuing at or above trend levels in the United States, most of Asia, and most of Latin America, in spite of high oil prices. The growth achieved by world economy indicates that the impact of any macroeconomic shock depends on the strength of the economy at the time.
Oil prices would have to reach $90 per barrel to be at the same inflation-adjusted level as prevalent in 1981. But financial and direct business investments by oil-rich countries are helping to keep cost of capital and interest rates low around the world.
Prudent energy policies, efficient energy usage, alternate energy sources, all are helping control the energy cost induced inflation.
11-Feb-06 
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