Ever since the early 1970s, every single time oil prices have spiked sharply (rising by 80pc or more), regular as clockwork the US has entered recession. Given America's massive influence on worldwide economic sentiment, the past five global recessions have all come in the wake of sharp jumps in the price of crude.
Only 8 months ago, oil was trading close to $65 a barrel. Last Thursday, Brent crude momentarily skimmed $120, up 17pc in a week, before stabilising at $112. If oil climbs above $120 again, and stays there, it would be 80pc above where it was in June 2010. We'd then have a bona fide oil-price spike, the sixth since the early 1970s, which suggests a US recession would follow.
No wonder US stocks are now under pressure. The S&P500, having enjoyed three straight weeks of gains, fell 2pc on Tuesday alone, contributing to the sharpest weekly drop in three months.
For more: History tells us that a surge in fuel costs makes a US recession likely - Telegraph
No wonder US stocks are now under pressure. The S&P500, having enjoyed three straight weeks of gains, fell 2pc on Tuesday alone, contributing to the sharpest weekly drop in three months.
For more: History tells us that a surge in fuel costs makes a US recession likely - Telegraph
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