Faultlines Emerge at OPEC Meeting

 

One of the biggest economic surprises of the year has been a precipitous drop in global oil prices. After spending most of the summer above $100, crude has plummeted to the low $70s, and today’s OPEC meeting could send it down even further, as West Texas Intermediate is currently flirting with the $60s.

So swift and steep of a drop will inevitably ripple through the global economy. For one, lower energy costs pull prices down, which is why the alarm bells of inflation risk from quantitative easing have now been replaced with deflation risks from a downward consumer spending spiral – a ‘Japan syndrome’ for the world.

 

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