We’ve had plenty of economic shocks since coronavirus struck.
Jobs figures, GDP stats and companies going bust.
But if there’s one measure to show the state we all find ourselves in then look no further than the Saudi Aramco results which came out yesterday.
The company’s income dropped by 73% over April, May and June this year as the world’s oil consumption ground to a halt.
Boohoo, you might say. Well, it’s important.
Analysts and economists are desperate for indicators that show economic activity and sentiment. Stock markets offer little insight, they’ve been manipulated so much by quantitative easing over the past ten years that a daily 100 point gain or fall means little these days.
While tracking Uber trips is for the trainspotters.
The only real measure of human economic activity right now is oil.
The black stuff is used in cars, planes, trains - anything that involves travel. Generally, when oil consumption is booming the world is booming.
The business person who decides to go to Dhaka to see if jeans can be made in the Bangladesh capital or the pharmacist who flies to the Middle East to see if it's possible to set up a new drugs business.
Real business decisions and risks can only be taken by seeing the product, the factory or the other person first hand.
There is also a financial boost for the West. Thanks to Henry Kissinger oil is traded the world over in dollars which is then fed back into US banks and the global economy mostly via sovereign wealth funds.
Sovereign wealth funds are beasts. Take the Norway Government Pension Fund, known as the Oil Fund, which was established in 1990 to invest the surplus revenues of the Norwegian petroleum sector. It has over $1 trillion in assets, including 1.4% of global stocks and shares, as well as large stakes in private equity funds.
Granted, backing oil consumption has never been more unfashionable.
And no one seems to dislike oil more than the oil industry itself.
Ten minutes with BP chief executive Bernard Looney and anyone would think the company’s 111 year old history had been one long pact with the devil.
But the reality is only 10% of the world’s energy is from renewable sources, while electric cars make up 2% of sales. There’s much to be done still.
So while it’s comfortable at home, playing Zoom and pretending to be ‘productive’, the only solution to all this is to get back out there. Get back in the car, take the train and book a business class airplane ticket to secure the next big deal.
It’ll make Saudi Aramco and sovereign wealth funds richer, but the alternative is a grim little world where no one ever leaves the front door.