A Funny Thing Happened To Oil Prices When Nixon Killed The Gold Standard

Israeli PM Golda Meir meets U.S. President Richard Nixon in Washington, March 1, 1973

A Funny Thing Happened To Oil Prices When Nixon Killed The Gold Standard (ZeroHedge, Dec 20, 2014):

For the past 150 years, crude oil prices have varied between around $10 per barrel and around $120 per barrel. For many decades, oil prices were relatively “stable” but a funny thing happened in the early 70s and everything changed – whether coincidental or causative the linkages between the oil crisis and Nixon’s Gold-Standard-busting of Bretton Woods are clear in the chart below. Goldman expects continued high oil price volatility with risks skewed to the downside as the market searches for a new equilibrium… and a period of macroeconomic adjustment to structurally lower oil prices. Is oil adjusting to a new ‘gold-standard-esque’ normal?

Leave a Comment