Getting To Love $100 A Barrel
The Economist looks on the bright side of oil price increases:
Adjusted for inflation, the $100 barrel would not exceed the record set in 1980. Also, big economies today are generally better insulated from oil-price fluctuations. Developed countries use half as much oil per real dollar of GDP as in the mid-1970s, thanks to improved energy efficiency. This year the price of oil has increased by about 70% since January without stunting economic growth in America.
Not only could the world withstand higher prices, some argue that further increases would be beneficial. A growing number of economists suggest that pricier oil is healthy, particularly for the environment. But the rise must be gradual and predictable so that economies can adjust. Large and sudden increases are the ones that tend to create recessions.
Meanwhile, some Germans are freaking out.