Macroeconomist Arnoud Boot believes that rising oil prices can give us the boost we need. “We need to use moments like this to disconnect from the group of countries that have commodities like oil.”
Many drivers have undoubtedly cursed after OPEC+ countries’ announcement to pump less oil, which will also raise the price of gasoline. But from a broader perspective, BNR macroeconomist Arnoud Boot calls the decision to cut oil production by five percent “a blessing.”
“We are faced with the task of fully adapting our economy,” Boot says. Higher prices can give us a push in the right direction.
Boot also notes that “both stock markets and citizens are reacting fairly neutrally” to the OPEC+ announcement. According to the economist, the upheaval is nothing compared to what we experienced immediately after the Russian invasion of Ukraine. “And even there you saw that we handled energy uncertainty reasonably well.”
The knife is no longer on the throat
That’s why Boot concludes that right now, ‘when the knife is no longer at our throat’, we should move further away from oil and OPEC. “Because if you look at it from afar, it’s obviously strange that we depend on a bunch of countries that can influence market prices on their own and at will.”
“If you look at it from a distance, it’s obviously strange that we depend on a bunch of countries that can influence market prices on their own”
Uncertainty is never good
“We have to use this rest to adjust and not wait for the moment when the knife is at our throat again,” says Boot. He compares it to a back injury. “When I have back pain, I always think: I should have done my back exercises earlier, at a time when I didn’t have pain.”
“Many companies were undoubtedly happy that oil has gotten a little cheaper recently,” admits Boot. “But on the other hand, that incredible uncertainty around the prices of oil and other commodities is never good for any company.”
Source: BNR
Andrew Dwight is an author and economy journalist who writes for 24 News Globe. He has a deep understanding of financial markets and a passion for analyzing economic trends and news. With a talent for breaking down complex economic concepts into easily understandable terms, Andrew has become a respected voice in the field of economics journalism.
