On Friday, 20 June 2014, West Texas Intermediate (WTI) crude oil traded in Cushing, Okla., at US $107.95 a barrel; by the end of the year it was selling for $53.45, almost half the summer peak. For the first time, people wondered whether the price of oil might actually be too low.Average prices of WTI rose roughly 52-fold between 1970 and 2014, in current dollars—an enormous jump. How could the economies of oil-importing countries have kept on growing? The answer is simple: That 52-fold multiple is based on a doubly misleading metric. Though prices did soar in the 1970s, their fluctuations have been relatively restrained since then.
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