It is often said that money makes the world go round. Nowhere is this more ingrained than in the battles for oil, power and arms. The news of Saudi Arabia and its key allies severing connections with Qatar following the ongoing rift between the Gulf Cooperation Council (GCC) members shocked the world. Here are three theories about this issue.
Inflation is unlikely to flare up again as long as commodity prices remain depressed. Inflation helps countries, companies and households that have high debts to pay them off because it reduces the value of the debt, so without it the world is slowly walking into a debtors’ nightmare.
Oil prices are going to continue to be driven by fundamentals rather than investment in the coming months, analysts at Societe Generale forecast in a recent market report.
Their base case scenario is that a diplomatic solution to the Syrian crisis succeeds and that production in Libya remains constrained by the strikes and protests by militias that have pretty much stopped much of the country’s oil output.