The right side of the oil boom

Living in the Gulf and writing about business affairs can leave you with certain assumptions about economics and finance. Few in this part of the world would doubt that rising oil prices are a good thing – the stratospheric price increases we have recently witnessed, and which show no sign of abating in the long term, are generally regarded as a good thing.

They add to the wealth of the states producing the precious stuff and fund the ambitious infrastructure development, which directly affects our daily lives. For expatriates, the rising oil price pays our salaries, and as long as petrol is subsidised and cheap, there can be no complaints.

But it is interesting to occasionally see the other side of this coin, and after a week in London I can tell you it looks very, very different from the perspective of the oil importers.

Britain seems to be trapped in a bubble of pessimism about the economic future, most of it energy related. In the few days I was there, there were protests by long-distance hauliers hit by the increase in diesel prices to the extent that many claimed they were on the verge of bankruptcy; worries on the part of consumers and homeowners that they faced the real prospect of not being able to meet their monthly financial commitments, with energy costs a major factor in that negative equation; and a general sense of insecurity inspired by the perception that Britain seems to have lost control of its economic destiny.

On hearing that I lived and worked in the UAE, many people I talked to, from all walks of life, had only one question: "how do I get there?" I am sure there is going to be a big influx in the number of expatriate workers from Britain seeking refuge in the booming economies of the Gulf.

One little vignette serves to illustrate the black mood of Brown's Britain: I read The Great Crash by the American super-economist JK Galbraith many years ago, but recent events in the US made me want to reread his classic tale of economic disaster.

I asked in all the big bookshops on London's Piccadilly, but the reply was the same everywhere: "sold out". One helpful assistant told me that they had sold hundreds in recent weeks, and had hundreds more on order, before using his shop computer to track down what must have been the last copy in London. By the time I got to that shop, however, it has just been sold. (I eventually got a copy at the airport, where they were selling fast).

The British obviously think they are in for a rough time. It feels good to be back on the right side of the oil boom.

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