New trends in world merchandise trade in the post-crisis years

Abstract

The article examines the causes of a significant slowing of world merchandise trade. It shows that this phenomenon is explained not only by cyclical, but by structural long-term factors as well indicating probability of such a dynamics of international trade in the foreseeable future. The author scrutinizes the current fall in oil prices and finds a lot in common between it and the collapse of oil prices in1985-86, after which low oil prices hovered for about twenty years. Finally, the author highlights the factors that may contribute to sustained low oil prices during a long period: sluggish demand for oil; the switch-over of the control of the oil market from OPEC and Saudi Arabia to the producers of shale oil in the United States; the multiplicity of players and the widespread practice of hedging in the industry that would condemn it for a permanent overproduction crises.