Energy Impact on Global Economy Is Understated

The energy shock to economic growth will be felt worldwide through the increasing global imbalance between high investment and low consumer spending, according to an analysis by The Conference Board, the global research and business membership organization.

    The steady rise of global commodity prices since 2002 has been led by
spiraling oil prices. There have been a number of additional factors
motivating these increases: exceptionally low interest and inflation rates, a
surge in emerging market demand led by heavy investment in China, the
acceleration of global manufacturing activity in 2004, and a shortfall in
natural resource investment for almost 20 years.

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