M&G's Leaviss: 'Inconvenient' oil prices will prove a blessing

With developed economies flirting with deflation, central banks will likely regard the oil price slump as troublesome. M&G's Jim Leaviss explains how short-term deflation could turn to long-term growth boost.

Oil's unsteady path The path of oil prices has been far from steady in recent decades. In 1973, the world's major industrial countries were faced with an oil embargo from the Middle East. Oil prices quadrupled, causing economic growth in many countries, including the US and UK, to stagnate. Then in 1979, production fell following the Iranian Revolution, again causing prices to rocket. During the 1990s was the era of the next significant spike in prices, this time in response to the Iraqi invasion of Kuwait. More recently, a combination of supply and demand factors contributed to...