By Simon Miller
The International Monetary Fund has warned that rising oil prices could kill of the global economic recovery.
As prices rise in response to tensions in the Middle East, IMF chief Christine Lagarde told the Chinese Development Forum, in Beijing on Sunday that the world was not out of the danger zone.
She commented: “The rising price of oil is a new threat that could derail the recovery. I think it is a major threat. Optimism must not lull us into a false sense of security. The global economy may be on a path to recovery, but there is not a great deal of room for manoeuvre and no room for policy mistakes.”
Brent Crude hit a high of $126 per barrel last week and global supply has dropped by 2m barrlers per day following troubles in the Middle East that include EU sanctions against Iran.
Following UK Prime Minister David Cameron's trip to the US last week, reports suggested that Britain could join the States in trying to reduce the cost of crude through the release of tactical supplies.