Oil price fall ‘good news’ for world economy: IMF

Published December 3, 2014
— Reuters/File
— Reuters/File

WASHINGTON: The plunge in oil prices since June may hurt some crude exporters but is overall a good thing for the world economy, International Monetary Fund (IMF) Managing Director Christine Lagarde said on Monday.

“There will be winners and losers, but on a net basis it’s good news for the global economy,” she said in Washington.

Oil prices have fallen sharply since late June, losing around 30 per cent as supplies increase and global demand for oil grows more slowly.

While some exporters are hurting from the price fall, overall it will add significantly to global growth as consumers and businesses pay less for energy.

“It’s likely to be an additional 0.8pc (of growth) for most advanced economies, because all of them are importers of oil, whether you look at US, Japan, certainly Europe... and China,” she said.

Crude oil exporters “are taking a hit, for some of them it’s a calculated hit,” Lagarde said, in a reference to the Gulf producers like Saudi Arabia, which have been reticent to cut production to firm up prices.

In October, the IMF cut its forecast for global growth this year to 3.3pc and to 3.8pc in 2015, citing stagnation in Europe and Japan and the slowdown in emerging economies.

Lagarde was speaking at a conference of corporate chief executives sponsored by the Wall Street Journal.

Published in Dawn December 3rd , 2014

Follow Dawn Business on Twitter, LinkedIn, Instagram and Facebook for insights on business, finance and tech from Pakistan and across the world.

Opinion

Editorial

Throttling connectivity
Updated 15 Aug, 2024

Throttling connectivity

Now the authorities seem to have decided that WhatsApp has replaced X as the new staging ground for dissent and are tightening the noose.
Targeting TTP
15 Aug, 2024

Targeting TTP

Is slapping on a new label on a hard-core terrorist outfit the right strategy, especially when the label is also imbued with religious meaning?
Transgender justice
15 Aug, 2024

Transgender justice

Our policymakers still see this community as a slur, making political commitment to justice for transgender people a distant dream.
Rebuilding a dream
Updated 14 Aug, 2024

Rebuilding a dream

"True" independence — and not in the sense of a political slogan — can only be achieved when Pakistan’s children are assured of a better tomorrow.
A general’s arrest
14 Aug, 2024

A general’s arrest

A PAKISTAN Army general who had once seemed all-powerful has been arrested by his own institution for a list of...
No exceptions
14 Aug, 2024

No exceptions

CAREER civil services officer Rashid Mahmood Langrial, who recently became the ninth person to be appointed head of...