The global expansion has also resulted in high prices for many Norwegian export goods. The increase in oil prices over the past 4-5 years has been very important. High oil prices over a longer period have  BIS Review 28/2007  3  boosted oil investments and there are prospects that the high investment level will be sustained in the coming years. Oil prices peaked around USD 75 per barrel in summer 2006. Later in autumn, prices fell. Current futures prices indicate that market participants believe prices will remain above USD 60 per barrel in the coming years. A fall in prices in a number of commodity markets at the beginning of 2007 raised the question of whether the pronounced price rise of recent years was being reversed. The experience of previous commodity price cycles indicates that rising prices gradually lead to increased supply and reduced demand. This in turn leads to a fall in prices. Following a long period of expansion, international financial markets were marked by unrest around the end of February. It is still too early to say whether the turbulence signals a weakening of global growth prospects. Increased integration of China, India and other emerging economies into world trade, in conjunction with lower tariffs and reduced trade barriers, has led to a decline in prices for imported finished goods. This effect has been strengthened by a significant increase in the share of imports from low-cost countries.
In my remarks today, I would like to expand on three points. First, I want to show how a very severe double dip crisis required the ECB to deploy unconventional instruments to ensure price stability. And our measures are proving effective: incoming data confirm that the cyclical recovery of the euro area economy is becoming increasingly solid and that downside risks have further diminished. Second, I will discuss the possible side effects of these measures. I will consider the different dimensions in which our monetary policy affects people’s finances and welfare, which are sometimes overlooked in the current debate. Finally, I will outline why the ECB cannot be the only actor contributing to the recovery. Other economic, financial and fiscal policies are essential to ensure a sustained recovery. Recovering from the crisis: the role of monetary policy Let me start by recalling where we came from. The Great Recession, as it is called, resulted in a protracted period of low inflation and low growth. Specifically, the euro area faced two interlinked and successive crises – a financial crisis in 2008 and a sovereign debt crisis that started to emerge in 2011 and derailed the rebound. The recovery that began in mid-2013 lost steam in the summer of 2014 as the external environment became more uncertain. At the beginning of 2014, credit growth was contracting at an annual pace of more than 3%, while overall economic growth was stalling.