Weekend Edition: IMF Warns on Rising Oil Prices

The International Monetary Fund warned last Friday that rising oil prices are becoming a threat to the global economy. This rise has been??fuelled??by tensions between western nations and Iran who is facing punitive measures against its crude exports.??The situation in Iran is a risk as it might get hit by Israel in a sudden strike who cannot afford to let the Islamic republic claim nuclear weapons. Supplies sure will tighten if the straits of Hormuz are closed as a result of military action.

20% of World Oil Transits through the Strait of Hormuz

Putting the Iranian situation aside, we’ve seen what higher oil prices can result in, it is a scenario we lived through last year. As oil prices rise above a certain threshold, the market sells off stocks as it prices in a recession and reduced oil demand as a result.?? With Brent at $126 a barrel and WTI at $110, will stocks start the selloff in March as a consequence or will oil prices return back to the $90-$100 sweet spot just in time?

News Roundup

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Soaring oil price ignores fundamentals

Energy billions passing Canada by

Blog Roundup

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Closing your DRIPs and SPPs, transferring your shares to your brokerage (My Own Advisor)

How the Federal Minimum Wage Crushed the Economy of American Samoa (FG)

Carnival Roundup

Yakezie Carnival at Financial Success for Young Adults
Canadian Finance Carnival at Canadian Finance Blog
Carnival of Wealth at Control Your Cash

Have a Great Weekend!