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| Oil price is risk to economic recovery, says IEA | Oil price is risk to economic recovery, says IEA |
| (1 day later) | |
| The current high price of oil will threaten economic recovery in 2011, according to the International Energy Agency (IEA). | The current high price of oil will threaten economic recovery in 2011, according to the International Energy Agency (IEA). |
| It said oil import costs for countries in the Organisation for Economic Co-operation and Development had risen 30% in the past year to $790bn (£508bn). | It said oil import costs for countries in the Organisation for Economic Co-operation and Development had risen 30% in the past year to $790bn (£508bn). |
| The agency says this is equal to a loss of income of 0.5% of OECD gross domestic product (GDP). | The agency says this is equal to a loss of income of 0.5% of OECD gross domestic product (GDP). |
| href="http://www.bbc.co.uk/news/business-12122510" >The IEA's chief economist said oil was a key import of any developed country. | |
| There are also concerns about the rising costs of other commodities. | There are also concerns about the rising costs of other commodities. |
| The UN's Food and Agricultural Organisation (FAO) said the high oil price had pushed the price of food to a new record. | The UN's Food and Agricultural Organisation (FAO) said the high oil price had pushed the price of food to a new record. |
| Global food prices rose to a fresh high in December, according to its Food Price Index. The previous record reached in 2008 sparked riots in several countries. | Global food prices rose to a fresh high in December, according to its Food Price Index. The previous record reached in 2008 sparked riots in several countries. |
| Higher coal | Higher coal |
| Coal prices, too, are rising around the world after floods in Queensland north east Australia stopped most of the country's coal production. | Coal prices, too, are rising around the world after floods in Queensland north east Australia stopped most of the country's coal production. |
| Analysts warned that this would push coal prices higher, just as the world was beginning to need more raw materials to fuel the growing economic recovery. | Analysts warned that this would push coal prices higher, just as the world was beginning to need more raw materials to fuel the growing economic recovery. |
| In an interview with the BBC World Service, the IEA's Fatih Birol warned about the current high price of oil: "There is definitely a risk of major negative implications for the global economy." | In an interview with the BBC World Service, the IEA's Fatih Birol warned about the current high price of oil: "There is definitely a risk of major negative implications for the global economy." |
| He explained that the oil price was central to both national and personal budgets. | He explained that the oil price was central to both national and personal budgets. |
| "If the oil price goes much higher, it affects everything from the trade balance to household spending." | "If the oil price goes much higher, it affects everything from the trade balance to household spending." |
| He added that that meant pressure on household budgets and higher inflation. | He added that that meant pressure on household budgets and higher inflation. |
| Quotas unchanged | Quotas unchanged |
| The IEA was established in the 1970s as the West's energy watchdog to counter the growing influence of the Organization of the Petroleum Exporting Countries (Opec). | The IEA was established in the 1970s as the West's energy watchdog to counter the growing influence of the Organization of the Petroleum Exporting Countries (Opec). |
| The price of US light oil rose to a 27-month high earlier this week, but has since fallen back to $88.98 a barrel, with Brent Crude at $93.15. | The price of US light oil rose to a 27-month high earlier this week, but has since fallen back to $88.98 a barrel, with Brent Crude at $93.15. |
| Opec members have been unconcerned by higher recent oil prices and have not shown an inclination to change export quotas. | Opec members have been unconcerned by higher recent oil prices and have not shown an inclination to change export quotas. |
| While higher oil prices bring in more money to oil exporting countries, making life too difficult for its customers can backfire. | While higher oil prices bring in more money to oil exporting countries, making life too difficult for its customers can backfire. |
| Mr Birol told the Financial Times newspaper: "Oil exporters need clients with healthy economies but these high prices will sooner or later make the economies sick, which would mean the need for importing oil will be less." | Mr Birol told the Financial Times newspaper: "Oil exporters need clients with healthy economies but these high prices will sooner or later make the economies sick, which would mean the need for importing oil will be less." |