Why Price Reference Agencies’ Own Valuations Are Rising

Even in a global economy that is gradually decarbonizing, the price of oil has a strong claim to be among the most closely watched numbers in the world. Few other metrics – give or take US jobs data and the federal funds rate – invite so much scrutiny from economists and policymakers.

Brent and West Texas Intermediate, the two leading oil price benchmarks, simultaneously reflect current economic reality while prefiguring coming developments. Rising prices accelerate capital flows into the major oil-exporting nations and drive consumer goods inflation; falling prices do the reverse, signifying an effective tax cut for the majority of net-importer nations.