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Economists Say World Far Better Equipped for Oil Shocks than in the 1970s
A diversified energy mix, stronger efficiency standards and strategic oil reserves have reduced vulnerability, economists said, even as prices surge again.
- Oil prices are surging as conflicts in the Middle East escalate, with Iran effectively blocking the Strait of Hormuz and removing roughly 15% of daily global oil production from circulation.
- This energy shock recalls the 1973 embargo, when President Richard Nixon urged Americans to conserve fuel and asked Congress to lower maximum speed limits to 55 miles an hour.
- To calm markets, the Paris-based International Energy Agency's 32 member countries agreed last month to release 400 million barrels of oil, including 172 million barrels from the U.S. Strategic Petroleum Reserve.
- Amy Myers Jaffe of New York University's Center for Global Affairs notes that countries are better prepared than five decades ago, possessing strategies to handle such energy shocks.
- Despite these advances, University of Chicago Energy Policy Institute expert Sam Ori cautions that the U.S. remains vulnerable to price volatility, noting that "oil is still king" and stimulus policies could reignite inflation.
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IMF Chief Says Oil Shock Tests a World With Little Fiscal Buffer
The International Monetary Fund said that the conflict in the Middle East is a major supply shock that will test the resilience of a world with limited scope for fiscal support, even as US and Iran have negotiated a two-week ceasefire.
·United States
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Coverage Details
Total News Sources59
Leaning Left17Leaning Right5Center25Last UpdatedBias Distribution53% Center
Bias Distribution
- 53% of the sources are Center
53% Center
L 36%
C 53%
11%
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