GEOPOLITICAL AND ECONOMIC CONSEQUENCES OF LOW OIL PRICES

Lower oil prices will have enormous economic and political consequences that will be felt globally in a variety of ways. For oil consumers, lower prices are akin to a tax cut. This will allow them to do a combination of the following: increase savings, pay down debt and increase consumption. In most countries, consumers will gravitate towards spending more. The biggest beneficiaries will be the countries with no significant oil resources of their own, such as the nations of Eastern Europe, and some Asian economies, including India, South Korea and Japan.