George Magnus, a senior economic adviser at UBS, argues that the world is heading for a shock over the high price of oil (FT, 16 August):
"...what if oil prices were to remain high over the medium-term? The impact one year ahead, for example, of a permanent change (from $45 this time last year) to today's levels above $60, with all things constant, would be to cause GDP to fall by 1-2 per cent in South Korea, Taiwan, Turkey and South Africa and by up to 1 per cent in China, most of Europe, Japan and the US. The effect on already stressed current account positions would be to push the
The overall net transfers from oil consumers to oil producers by 2007 are estimated at about $1,500bn - or nearly 3.5 per cent of world GDP. This would amount to a recycling problem of increasing complexity, from both an economic and a political point of view."
Let's say 3% of $1,500 billion for Wahabist or Salafist teaching - $45bn; and 0.5% for violent jihad - $7.5bn.