In the oil-importing countries, where unaccommodating monetary policies are geared to preventing secondary inflationary effects, real wages and producer prices need to remain suitably flexible if an increase in unemployment is to be avoided and the loss of output contained.
On the other hand, the rise in the price of oil has caused a change in relative prices that should bring about a reduction in oil consumption and the use of alternative sources of energy. National governments should not discourage such a process. One important question is whether the present low volatility will reinforce or undermine financial stability.