[east1234]

I partially agree, but China and India are less likely to handle the increase in cost than we are. It will slice their demand, as well as other 3rd world countries. Prices will come down then, but not way down, and not for the long term.

[Tallguy]

...China and India are less likely to handle the increase in cost than we are.

I thing I have to disagree. Those economies that you mention are manufacturing economies where energy prices are just another input. Remember Japan in the mid-70's to mid-80's? They did quite well during the last period of high-inflation & energy price spikes. Their advantage over our economy in manufacturing is relative. IOW's they will have an advantage over us regardless the price of oil.

I think China & India will pay the price to maintain their level of economic growth. Now, they may paper-over other structural problems in the process like Japan did. Collapse after a long 10-year run.