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Brent crude oil falls below $100 a barrel

Lowest level since July 2012.

Brent crude spot prices have fallen  to as low as $98 per barrel, the lowest level since July 2012, after traders reacted to the IMF revising their global economic growth forecast to 3.3 per cent from 3.5 per cent.  In the same global economic outlook, the IMF forecasts oil prices to average $102.60 in 2013, above today’s close.  Oil production gains in North America from unconventional resources coupled with oil demand destruction in OECD countries from fuel efficiency gains will continue to weigh on crude prices going forward, but there is also strong price support. 

Economic difficulties in OECD countries, particularly in Europe, are resolving themselves slowly and any further deterioration in Western economies would likely spur new policies bolstering growth and sparking demand.  There risks of a major supply disruption in the Middle East or Africa where geopolitical risks remain high.  Syria remains in conflict and an Iran with nuclear intentions continues to defy, with other hotspots in the region on the perpetual edge maintaining a fear premium in prices.  Apart from these potential supply shocks, with a global production share of over 40 per cent, the OPEC still heavily influences prices.  The cartel has a target price of $100 per barrel strategically set to continue fueling member-country economies and governments.  Deviation from their target is likely to be met with oil production cuts to support their desired price, they meet in Vienna May 31st.

Matthew Jurecky is Head of Energy Research and Consulting at GlobalData

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Is anyone prepared to solve the NHS funding crisis?

As long as the political taboo on raising taxes endures, the service will be in financial peril. 

It has long been clear that the NHS is in financial ill-health. But today's figures, conveniently delayed until after the Conservative conference, are still stunningly bad. The service ran a deficit of £930m between April and June (greater than the £820m recorded for the whole of the 2014/15 financial year) and is on course for a shortfall of at least £2bn this year - its worst position for a generation. 

Though often described as having been shielded from austerity, owing to its ring-fenced budget, the NHS is enduring the toughest spending settlement in its history. Since 1950, health spending has grown at an average annual rate of 4 per cent, but over the last parliament it rose by just 0.5 per cent. An ageing population, rising treatment costs and the social care crisis all mean that the NHS has to run merely to stand still. The Tories have pledged to provide £10bn more for the service but this still leaves £20bn of efficiency savings required. 

Speculation is now turning to whether George Osborne will provide an emergency injection of funds in the Autumn Statement on 25 November. But the long-term question is whether anyone is prepared to offer a sustainable solution to the crisis. Health experts argue that only a rise in general taxation (income tax, VAT, national insurance), patient charges or a hypothecated "health tax" will secure the future of a universal, high-quality service. But the political taboo against increasing taxes on all but the richest means no politician has ventured into this territory. Shadow health secretary Heidi Alexander has today called for the government to "find money urgently to get through the coming winter months". But the bigger question is whether, under Jeremy Corbyn, Labour is prepared to go beyond sticking-plaster solutions. 

George Eaton is political editor of the New Statesman.