Rising oil prices are a double-edged sword for the world economy. With the price of crude up 14 percent this year and now trading at the highest since 2014, exporters of the fuel get to enjoy a windfall while consuming nations get hurt.
Much ultimately depends on the reason why prices are pushing higher. An oil shock on the back of constrained supply is a negative though higher prices due to robust demand may just reflect solid global growth.
Either way, there are winners and losers, especially among emerging economies. Countries who rely on imported energy will be squeezed as costs go up, balances of payments become strained and inflation accelerates. For exporters, government coffers will get a fillip. Read More