Moreover, when compared with the 1970s and 1980s, the oil intensity of production in the euro area and elsewhere has fallen significantly. Finally, it should be kept in mind that, in contrast to previous periods of oil price turmoil, this year’s rise in oil prices is not only due to supply-side factors, but is also driven by the strong global expansion.
All these factors put the downside risks to economic activity coming from oil prices into perspective. BIS Review 48/2004  1  However, recent oil price developments have had a visible direct impact on price developments in the euro area. Eurostat’s flash estimate for annual HICP inflation in August was 2.3%, unchanged from July.