Global Implications of Lower Oil Prices

By Aasim M. Husain, Rabah Arezki, Peter Breuer, V. Haksar, Thomas Helbling, Paulo A Medas, Martin Sommer

July 14, 2015

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Aasim M. Husain, Rabah Arezki, Peter Breuer, V. Haksar, Thomas Helbling, Paulo A Medas, and Martin Sommer. Global Implications of Lower Oil Prices, (USA: International Monetary Fund, 2015) accessed November 23, 2024

Disclaimer: This Staff Discussion Note represents the views of the authors and does not necessarily represent IMF views or IMF policy. The views expressed herein should be attributed to the authors and not to the IMF, its Executive Board, or its management. Staff Discussion Notes are published to elicit comments and to further debate.

Summary

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.

Subject: Commodities, Energy prices, Energy subsidies, Expenditure, Fuel prices, Oil, Oil prices, Prices

Keywords: Economic activity, Energy prices, Energy subsidies, Exchange rate regime, External vulnerabilities, Fiscal vulnerabilities, Fuel prices, Fuel taxes and subsidies, Global, Monetary policy, Oil, Oil exporter, Oil price, Oil prices, Price decline, Price drop, Price pass-through, SDN, Windfall gain

Publication Details

Pages:

41
Volume:

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DOI:

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Issue:

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Series:

Staff Discussion Notes No. 2015/015
Stock No:

SDNEA201515
ISBN:

9781513532417
ISSN:

2617-6750

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