Ken Wattret
speaker
312 appearances
3 recordings
1 series
first heard Jun 2026
last heard 11 Jul
Ken Wattret’s voice in public audio — every appearance, attributed to the second.
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recordings per month · last 12 monthsRecordings per month over the last 12 months — 3 in all, peaking in Jul 2026 with 2.
Appearances
For example, if we deflate the oil price using the US Consumer Price Index, the price of Brent exceeded $200 a barrel in mid-2008, just before the intensification of the global financial crisis.
That's roughly twice the current.
Level.
And if we go further back to the late 1970s and early 1980s following the Iranian Revolution, the Brent price, again, in real terms, deflated by the US Consumer Price Index, that peaked at around $180 a barrel, which again is well above the current level.
So that's a comfort of sorts when thinking about the potentially adverse impacts on global economic growth of the current oil shock.
But we still need to be cautious first, and obviously because the current shock is ongoing and prices could rise much further if the supply disruptions continue.
And secondly, because the negative growth impact may not just be about the level of oil prices.
We may also be running into shortages if the disruptions continue and that could aggravate the negative economic effects.
I think there are some lessons that we can learn from prior shocks, but we need to look carefully at what drove the shock, how long it lasted, and the economic conditions at the time.
So, for example, if we look back at the late 2000s and early 2010s, the price of crude was well over $100 a barrel for a very long time.
Now that was due primarily to very strong demand from China.
But
Demand conditions elsewhere were very weak, primarily due to a hangover from the global financial crisis.
And as a consequence of that, core inflation rates excluding
energy and food, they generally remained rather low.
So the major central banks at the time looked through the persistently high oil price and they kept their policy rates at pretty low levels.
Now in the early twenty twenties, coming out of the pandemic and aggravated by the war in Ukraine, crude prices were again well above a hundred dollars a barrel.
But on that occasion
Although the oil shock was less persistent, core inflation rates rose markedly, and the reaction of the major central banks was ultimately very different as a consequence.
Now they initially underestimated the magnitude
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