Why the wild descent of oil is cause for concern

Categories: Analysis
Published on: February 8, 2016

The Tyee / Andrew Nikiforuk / 08 February 2016

OilSplatThe status-quo pundits say don’t worry. The world is awash in oil due to the brute force of fracking and Alberta’s faltering bitumen boom.

Markets are just experiencing another wacky correction in supply and demand, and business as usual will continue. Relax, add the pundits — lower energy prices tend to revive economies by putting more money in the hands of consumers, and all will be well.

But the global economy is now confounding academic theorists. Falling gasoline prices haven’t propped up the economy, or stimulated growth for that matter. In fact, global finance appears to be driving into another recession while debt grows, innovation disappears, capital investment recedes and wages stagnate.

So there must be another story.

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