January 19, 2007
GOOD NEWS: "Mild winter weather has something to do with it. So does heavy selling by financial funds. But a largely overlooked factor in the recent plunge in oil prices may portend an end to the multiyear rise in crude: For the first time in years, the developed world is burning less of it. Fresh data from the International Energy Agency show oil consumption in the 30 member countries of the Organization for Economic Cooperation and Development fell 0.6% in 2006. Though the decline appears small, it marks the first annual drop in more than 20 years among the OECD countries. . . . The fall in oil use by the industrialized world is a sign that the reactions to higher oil prices by businesses and consumers from the U.S. to Germany to Japan may be adding up to a cycle-turning downdraft in demand. The resulting shift in global cash flows could mean a big boost for oil consumers' economies at the expense of producers and exporters."