October 25, 2007
BRUNEI : Oil
High Oil Prices Have Downside For Locals
Spiralling oil prices benefit the overall Brunei economy due to its hefty crude oil exports, but it could mean that consumers would have to pay more for goods, especially manufactured and imported items, an economist said yesterday.
Bruneians may not directly feel the sting of increased oil prices, but this can potentially accelerate the hike in prices of consumer goods in the country.
"(Fuel) prices are fixed here, consumers aren't affected except (that) other goods might be more expensive," said Dr Roger Lawrey, associate professor at the Faculty of Business, Economics and Policy Studies, Universiti Brunei Darussalam.
The outlook for Brunei Darussalam's economy is rosy as the uptake in oil prices "means the GDP (Gross Domestic Product) would go up", he explained.
"In Brunei, it's just going to be good news," the UBD lecturer said.
It may be a different picture when it comes to the manufactured goods sector.
"There's always an energy component in anything manufactured," Lawrey said. Goods such as cars and food are largely imported; hence, raised prices from the exporting country could translate to consumers having to pay more in the importing country like Brunei.
Oil prices fell yesterday as US light crude went down to US$85.87 a barrel, down almost US$2.00 from the previous day.
Courtesy Brunei Direct