Elevated oil prices: a drag on global growth over the course of the year | Eurobank
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Elevated oil prices: a drag on global growth over the course of the year

• Factors such as increasing concerns over global economic activity, tighter monetary conditions and worries concerning the European debt crisis exert downward pressures on oil prices in the short term.
• However, tight supply and demand dynamics are expected to limit downside risks, since they keep oil prices at historically relatively high levels and leave the oil market rather sensitive to potential supply disruptions from geopolitical or other kinds of risks.
• We estimate that current levels of oil prices (about 40% higher than 2010), should they persist, will shave 0.5-1.0% off global economic growth over the next 1-2 years.