The drop in oil and natural gas prices this year will limit the global economic downturn, especially in Europe where fears of recession and galloping inflation have subsided.
Oil prices are currently trading in a tight range around the low $80s per barrel, down from over $100, and at one point $120 per barrel, in the spring of last year. Natural gas prices in Europe are at an 18-month low thanks to energy savings, demand destruction, well-above-average inventories, and milder weather for most of this winter. Europe’s economy has held up better in the past months than expected in the autumn, also due to the lower burden of energy prices on industrial production and consumer confidence.
In the United States, the economic picture is more nuanced, but consumers have felt relief at the pump in recent months, compared to the record highs of over $5 per gallon of regular gasoline at the…
