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BusinessinAfrica Events half of this year and at best growing at a paltry 0.5% in 2008, while the eurozone and Japan are both expected to grow by just 1.4%. In all, global growth could slow markedly, from 4.9% last year to 3.7% in 2008. The London based Capital Economics commented: “Given the clear deterioration in the outlook for demand, it is hard to escape the conclusion that oil prices are rising well above levels that can be explained by the usual economic fundamentals.” Strangely the oil market s are hitting new heights in a world of credit crunch and genuine fears of recession. On 9 May 2008, the US benchmark West Texas Intermediate reached $126/barrel, f

How high can prices go? A report researched and written by international economic analyst Moin Siddiqi The inexorable surge in crude oil prices from below $70/ barrel last August defies the conventional wisdom that says prices will drop when global economic activity slows and energy demand decelerates. According to the International Monetary Fund (IMF), “The world economy has entered new and precarious territory.” The energy-guzzling nations of the Organisation for Economic Cooperation and Development (OECD) – and especially the US – are suffering growth slowdown or mild recession. The latest World Economic Outlook report projects the US economy (largest oil consumer) dipping into a recession in the first

SpECIAL REpORT OIL & GAS

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