That is the question. And the answer is very likely both. The global commodities rout – which began with coal, has worked its way through iron ore and grains, is now hammering oil, and appears likely to take down industrial metals next, most notably copper – is shredding expenses for global consumers.
Where central banks have singularly failed to stimulate households with their rounds and rounds of money printing, succeeding in inflating commodity prices instead, oil can succeed in handing cash direct to consumers to spend. There’s no saying they’ll spend it given the debt revulsion that dominates much of the Western world still but they’ll have it at least and that’s a start.
The keenest beneficiaries will be the oil net importers including the US, China, Japan, Germany, India, South Korea, France and Italy. Consumers of these nations will see the double benefit of lower energy bills and better external balances, supporting currency, asset and purchasing power gains. It is not a small list of countries and households!