Effects of The 2000s Energy Crisis - Inflation and Recession

Inflation and Recession

Further information: Oil crisis and Recession of 2008

The perceived increase in oil price differs internationally according to currency market fluctuations and purchasing power of currencies. For example, excluding changes in relative purchasing power of various currencies, from 1 January 2002 to 1 January 2008:

• In US$, oil price rose from $20.37 to nearly $100, about 4.91 times more expensive;
• In the same period, the Taiwanese dollar gained value over the U.S. dollar to make oil in Taiwan 4.53 times more expensive;
• In the same period, the Japanese Yen gained value over the U.S. dollar to make oil in Japan 4.10 times more expensive;
• In the same period, the Euro gained value over the U.S. dollar to make oil in the Eurozone 2.94 times more expensive.

On average, oil price has increased approximately 400% for these areas. As a result of the dramatic price increase there have been global protests.

Rising transport costs may start to reverse globalization, because distance will cost more and more money. As oil prices keep rising, transport costs could cancel out lower wage advantages, such as in East Asia.