How Well Have Poor Countries Fared Under Higher Oil Prices?
Source: IMF Survey The simple answer, according to the International Monetary Fund, is not too badly, at least as measured by the number of countries lining up for additional aid. But the report was prepared using 2005 numbers. As the authors note, “…. with world oil prices continuing to rise substantially above the average price for 2005, a number of low income oil importers could face more serious pressures. In particular, they may have little scope to further compress the volume of petroleum imports without dampening growth. At the same time, if countries do not adjust, and higher imports of petroleum products lead to a loss of reserves, their financing needs could increase. For example, assuming an average oil price of $66.50 a barrel in 2006 and no further reduction in oil import volumes (as well as a reversal in capital flows to low-income oil importers, consistent with projections in the IMFs World Economic Outlook, April 2006), average reserves would be expected to fall by an
