Fed's Fisher: China growth a clear oil price signal
ASPEN, Colorado (Reuters) - Chinese economic growth can deliver a potentially massive boost to global energy demand with clear implications for long-term oil prices, Dallas Federal Reserve Bank President Richard Fisher said on Monday.
Fisher, speaking at a closed-to-the-press dinner hosted by the Progress and Freedom Foundation, made no reference to the U.S. economy or monetary policy in his prepared remarks.
A copy of the speech was made available to the media.
"Japan consumes 14 barrels of oil a year per capita," noted Fisher, a former deputy U.S trade representative who helped negotiate China's entry into the World Trade Organization.
"If China used the same amount per capita as parsimonious Japan, Chinese consumption would total more than 18 billion barrels a year, an amount that dwarfs our country's 7.5 billion barrels," said Fisher,
"Add that to new demand for oil stemming from India, the newest members of the European community, an increasingly prosperous Brazil and so on. For those trying to discern the long-term future of oil prices, this is considerable food for thought," he said.
Oil prices surged to a record above $140 a barrel this year before dropping sharply in recent weeks to below $113. But specialists say the long-term outlook for the market is strong owing to the factors that Fisher cited.
Referencing British Prime Minister Winston Churchill's advice that Russia was "a riddle wrapped in a mystery inside an enigma" that could only be unlocked by identifying its national interest, Fisher suggested doing the same for China.
"In contemplating China, we need to look past carefully crafted images and deepen our understanding of her national interest. Failure to do so will be perilous," he said.
(Reporting by Alister Bull, Editing by Neil Stempleman)
