The president of the European Central Bank, Jean-Claude Trichet, on Monday called on oil producers and consumers to learn from past mistakes if Western economies were to avoid a repeat of the high inflation and unemployment that followed the first global oil shock in 1973.
That year is widely acknowledged as an economic watershed, a time when an OPEC oil embargo led to a spiral of higher prices, recession in Western economies and a wrenching contraction in the early 1980s that finally put an end to a decade of sharp inflation.
No one, whether Western consumers or oil suppliers, should want to repeat that history, Trichet said. “There is a joint interest in behaving as properly as possible,” he said.
Trichet spoke at the Forum for New Diplomacy, a series of periodic discussions organized by the International Herald Tribune and the Paris-based Académie Diplomatique Internationale, on the occasion of the 10th anniversary of the ECB.
He did not specify what suppliers might do, but some countries, including the United States, have urged oil exporters to pump more crude to bring down prices.
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ECB chief warns against dangers of repeating 1973 oil shock
The president of the European Central Bank, Jean-Claude Trichet, on Monday called on oil producers and consumers to learn from past mistakes if Western economies were to avoid a repeat of the high inflation and unemployment that followed the first global oil shock in 1973.
That year is widely acknowledged as an economic watershed, a time when an OPEC oil embargo led to a spiral of higher prices, recession in Western economies and a wrenching contraction in the early 1980s that finally put an end to a decade of sharp inflation.
No one, whether Western consumers or oil suppliers, should want to repeat that history, Trichet said. “There is a joint interest in behaving as properly as possible,” he said.
Trichet spoke at the Forum for New Diplomacy, a series of periodic discussions organized by the International Herald Tribune and the Paris-based Académie Diplomatique Internationale, on the occasion of the 10th anniversary of the ECB.
He did not specify what suppliers might do, but some countries, including the United States, have urged oil exporters to pump more crude to bring down prices.
Read it all.