| Oil is a critical source of energy. In the past, a major oil price shock meant devastation for economic growth. "Our obsession with oil prices comes with good reason," writes Morgan Stanley economist Ellen Zentner. "Abrupt and sharp increases in oil prices have played a key role in precipitating recessions in 1973-75, 1980-81, 1990-91, 2001 and 2008-09."
Recent turmoil in Iraq has sent oil prices much higher. But economists aren't ready to freak out just yet. "Over time, however, those shocks to the relative price of oil have spurred innovations that have led to a more efficient use of energy inputs," continued Zentner...............................................Full Article: Source
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