Potential Oil Price Shock and Market Volatility
Oil’s Diminished Impact:
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- Despite the ongoing conflict in West Asia, Kenneth Kletzer, a professor of economics, believes that a potential oil price shock would have a less severe impact on the global economy compared to the past.
- Increased oil production from the US and Russia, along with Iran’s limited exports due to sanctions, have reduced the world’s reliance on oil supplies.
Market Uncertainty:
- Any global uncertainty, such as the West Asian conflict, can lead to market instability.
- The escalation of tensions between Israel and Iran has caused a surge in global crude prices and a decline in stock markets worldwide, including India.
India’s Developed Nation Goal: A Challenging Path
Ambitious Target:
- Kletzer acknowledges India’s impressive growth and poverty reduction but considers the goal of becoming a developed nation by 2047 to be ambitious.
- Achieving this target would require a sustained annual growth rate of 9-10%, which is difficult to maintain.
Realistic Aspirations:
- Kletzer suggests that becoming a “powerhouse of the emerging markets” is a more realistic goal for India.
- Income inequality remains a significant obstacle to achieving higher levels of welfare in India.
Upcoming US Election: A Global Concern
Potential Implications:
- Kletzer believes that the outcome of the upcoming US presidential election could have significant global implications.
- One candidate’s potential for greater uncertainty and rash actions could impact the global economy and peace.