Title: Impact of low oil prices on the EU economy
Authors: VRONTISI ZOIKITOUS ALBAN GABRIELSAVEYN BertVANDYCK TOON
Publisher: Publications Office of the European Union
Publication Year: 2015
JRC N°: JRC98188
ISBN: 978-92-79-52769-2
ISSN: 1831-9424
Other Identifiers: EUR 27537
OP LF-NA-27537-EN-N
URI: http://publications.jrc.ec.europa.eu/repository/handle/JRC98188
DOI: 10.2791/222885
Type: EUR - Scientific and Technical Research Reports
Abstract: The report describes the importance of oil for the EU economy and analyses the potential economic effects that current low oil prices since mid-2014 may have in the EU28 economy. Further it assesses how the current oil price decrease may evolve up to 2020 and the consequences for global oil consumption. The analysis shows that a decrease of the oil price from US$100 to US$50 may lead to a GDP gain of about 0.7%, both on a global level and in the EU28, driven by private consumption and investment. The global gains are not evenly distributed. Net oil importing countries gain, whereas oil exporting countries lose. The analysis mainly focuses on the EU28 and it shows that the more oil-intensive countries and sectors gain more than the rest of the economy. A 50% decrease of the oil price may generate up to 3 million additional jobs (1.3% of the total labour force). Interestingly, oil-intensive sectors do not necessarily improve their competitiveness vis-à-vis their competitors in other regions, as non-EU producers may be less energy efficient and therefore benefit more from low oil prices.
JRC Directorate:Growth and Innovation

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