BASEL, June 27: The Bank for International Settlements warned on Monday that further increases in the price of oil could do far more harm to the global economy than expected. Following increases during spring 2005, oil may remain anchored at a much higher price “for a long period of time”, the BIS predicted in its annual report.

“The increase in long-term oil futures prices is consistent with the view that there has been a major upward shift in the equilibrium price of oil,” the BIS report said.

“Further rises — if they materialise — may have more severe consequences than currently anticipated.

“Recent signs of inflationary pressures in the United States underline these risks,” the BIS, the central bank of central bankers, added.—AFP