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Interactive Chart On The Oil Price To Global GDP Correlation

Tyler Durden's picture





 

After we presented a micro-themed, static primer on the impact of the price of oil on the US consumer earlier, here is a macro picture perspective from Reuters, which correlates the change of oil prices to the corresponding change in world GDP (indicatively every $10 change in in crude results in an estimated range of 0.5-1.0% inverse change in global GDP).

 


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Fri, 02/25/2011 - 13:16 | Link to Comment Mr Lennon Hendrix
Mr Lennon Hendrix's picture

$191 here we come!

After that, we can pay pensions out in Exxon stock.  Problem solved!

Fri, 02/25/2011 - 14:41 | Link to Comment TeMpTeK
TeMpTeK's picture

Larry Edelson says Dow 20k +, US dollar collapse... And new one world currency all in one vid. http://www.youtube.com/watch?v=MBJx6PUEBPs

Fri, 02/25/2011 - 13:14 | Link to Comment pendragon
pendragon's picture

surely this is log and not linear?

Fri, 02/25/2011 - 13:14 | Link to Comment Oh regional Indian
Oh regional Indian's picture

Non-interactive picture of everythign you really need to understand about the Oil crisis.

http://aadivaahan.wordpress.com/2011/02/14/oil-crisis-in-a-thousand-words/

ORI

Fri, 02/25/2011 - 13:20 | Link to Comment Mr Lennon Hendrix
Mr Lennon Hendrix's picture

1,000,000 protesters in Baghdad?

Fri, 02/25/2011 - 13:23 | Link to Comment SDRII
SDRII's picture

Not to worry. They have a constitution.

Fri, 02/25/2011 - 13:29 | Link to Comment Mr Lennon Hendrix
Mr Lennon Hendrix's picture

The one Baker wrote?  Are they still using that?

Fri, 02/25/2011 - 13:26 | Link to Comment SDRII
SDRII's picture

02-25 11:35: Protesters take control of Libya's Brega oil terminal

.....disguised as SEALS
Fri, 02/25/2011 - 13:37 | Link to Comment SpeakerFTD
SpeakerFTD's picture

They need a third slider for 10,000s dead.

Fri, 02/25/2011 - 13:37 | Link to Comment Bruno the Bear
Bruno the Bear's picture

Off topic, but what causes today's gold/silver futures to diverge from the spot prices?  Gold/Silver futures are heading down but the spot right now, at least for silver, is up a little under a buck.

 

Is that backwardation?  Or something different? And how do you BTFD when they isn't any FD TB in spot prices?

Fri, 02/25/2011 - 13:44 | Link to Comment Oh regional Indian
Oh regional Indian's picture

The floor is your friend bruno. It is also the dip.

ORI

Fri, 02/25/2011 - 13:56 | Link to Comment fuu
fuu's picture

Sounds as if people are not bidding up futures as no one believes they will be delivered on is what I have gathered from the conversation around here the last few weeks.

Fri, 02/25/2011 - 13:57 | Link to Comment props2009
Fri, 02/25/2011 - 14:03 | Link to Comment falak pema
falak pema's picture

Crude gets rude and Gdp gets nuder as crude goes berserk.  So I think this chart is the relation of man to woman : the more rabid man's desire (crude price) the more passive becomes female desire (Gdp =...honey i'm spending, i'm spending and i'm loving it). Ha! Ha! I love this chart. My crude manhood feels at last rewarded. At its lawful price by the market of sighing females wanting to spend my dollars. But at MY price. Whatta killa!

Fri, 02/25/2011 - 16:34 | Link to Comment hardcleareye
hardcleareye's picture

FP, How old are you? 'Cause you obviously "don't know shit about women"...... (your analogy is one of an "inexperienced young boy")....

Fri, 02/25/2011 - 16:49 | Link to Comment falak pema
falak pema's picture

I try and stay young...its an art...only known to the illuminati!

Fri, 02/25/2011 - 14:55 | Link to Comment Windemup
Windemup's picture

This appears a bit too optimistic. From my "crude" calculations: (ha!) Since 1960, Each barrel of Oil enabled two times it's cost in GDP. This approximation holds for each decade since the 1960s. This means, over the relevant range of experience, if we produce one less barrel of oil, that the impact to the GDP will be twice the cost of that barrel. This is when Barrels were priced from between 12 to 45 dollars per barrel. I would estimate now that the impact is still close to two to one. A two percent decline in oil means a 4 percent decline in developed nations GDP.

Fri, 02/25/2011 - 15:18 | Link to Comment bullionaire1
bullionaire1's picture

I think the assumption that every $10 change in crude changes GDP between .5 & 1.0% is off, especially since it was probably derived from the days when US consumers still had home equity lines to access to buy those gas guzzling SUVs so that they could fill the back of it with cheap Chinese made consumer goods and furnish their second homes...

I suspect the price elasticity among consumers has increased, which along with supply concerns and related sovereign stockpiling of strategic oil reserves (at any $US fiat price), will create a relatively low tipping point where GDP will simply be crushed and drive everyone into the realization that we are actually not coming out of a recession, but entering merely the 2nd stage of a multi-stage depression...

 

Fri, 02/25/2011 - 15:20 | Link to Comment Windemup
Windemup's picture

My sentiments exactly.

Fri, 02/25/2011 - 15:36 | Link to Comment dark pools of soros
dark pools of soros's picture

right - but like during the dot com boom, everyone in the bubble doesn't see anything outside of it..  so until it pops everything is great.   Problem now, is this isn't just a geeky tech sector

Fri, 02/25/2011 - 16:33 | Link to Comment Vampyroteuthis ...
Vampyroteuthis infernalis's picture

This interactive table bothers me for the simple fact the IMF expects 4+% of global GDP. It does not even take into consideration other cyclical downside factors like Europe blowing up and etc.

Fri, 02/25/2011 - 16:40 | Link to Comment dehdhed
dehdhed's picture

hmmm ... i think i'm gonna go with my belief that's it's increased gdp that drives oil higher and not higher oil that drives gdp lower.   makes way better sense to me.

last time oil went zooming higher like this, the economy was booming and if not for the  financial mess i think the correlation would have remained intact.  i'm sure there's a tipping point but if that is given as the reason for the economic collapse, then i guess the bankers will definitely stay out of jail.

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