New Report Blames Oil Price Volatility for Lack of Stable Economic Growth
A new report from Oxford University has stated that crude oil price volatility is undermining stable economic growth around the world and that governments must do more to reduce their dependence on fossil fuels and protect themselves from increasing prices.
Sir David King, one of the co-authors of the report, a former Oxford don, and chief scientific adviser to the British government, said that a boom in production of shale oil and gas could well help to delay any high price increases and avoid violent fluctuations for the time being, but that it does not offer a long-term solution to the world’s energy needs. Fracking is “terrible news for the environment” but “excellent news for the economy,” and will help “buy us time for decarbonisation endeavours.”
The study written by King, Oliver Inderwaldi, and Zoheir Ebrahim, explained that the volatility of prices of crude oil over the past four decades has acted as “a fundamental barrier to stability and economic growth.”
The report, titled Macroeconomic impacts of oil price volatility: mitigation and resilience, said that “policy must focus on re-aligning the use of the oil derivative market away from speculation and towards its initial purpose: hedging. Improving derivatives market regulatory systems and working towards international derivatives regulatory standards will be vital in achieving this goal but efforts to curb speculation so far have been lacklustre.”