The global economy could be in a "damned if you do, damned if you don't" situation with energy prices. Oil has been climbing yet again and for the moment, supplies appear to be OK. The problem ahead is that if the global economy is indeed recovering (a debatable point though trending in that direction) then the current supply levels will be inadequate. That's where we start to have a problem with steep prices, again.
US light crude futures pushed above $79 a barrel, supported by the view that a recovering world economy would raise demand for crude. Oil prices have more than doubled from the low point they hit in the spring, but are still around half the all-time high of nearly $150 a barrel they reached in early summer last year.
Analysts have been surprised at the recent resilience of oil prices given the impact on energy demand of the global recession. In spite of this year's volatility in the oil price, the underlying trend for a decade has been for it to rise steadily.
