![]() To put some rough numbers around this, US average net imports of oil and the like has averaged 5.2m barrels per day in 2014, thus the fall in the oil price by $43 since late June is saving the US economy about $224m a day on its net oil transactions and costing its oil trade partners the same amount. At the global level it means less spent on oil imports for oil importing nations and less income from oil exports for oil exporting nations. Money oil consumers would have exchanged with oil producers for the stuff, can instead be put towards other purchases or savings. Stripping it down to its most fundamental level, a fall in the price of oil predistributes real income from oil producers to oil consumers. ![]() The fall in the price of oil – down more than 40% since June – is a textbook macroeconomic “shock”. The reality is that the true impact of the great oil crash of 2014 will not be revealed for at least several months, however for those who can't afford to wait, or simply lack the patience, here is perhaps the most comprehensive view of the pros and cons of what has now been dubbed a " textbook macroeconomic shock" by Deutsche Bank.įrom Deutsche Bank's 2015 Credit Outlook titled "Plate Spinning" Not a day passes without pundits on either side of the debate, eager to make their case that the acute, nearly 50% plunge in the price of crude, swear up and down their preferred economic ideology of choice that said plunge is for the economy.
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